CFOs Share Secrets to Nailing the First 100 Days at a PE-Backed Firm

By Heather Johnson and Monica Foster, Managing Directors at Focus Search Partners

In this post, which wraps up the first phase of Focus Search Partners’ ongoing CFO Insights Series, three PE-backed CFOs discuss what it takes to outperform expectations in the first 100 days on the job.

Like all newly hired executives, incoming CFOs want to make their mark. In private-equity-backed environments where time is money and money is the CFO’s primary responsibility, this effort must begin immediately with a plan that quickly creates value and makes a lasting impression on investors.

To find out what it takes for a CFO to capitalize on their first 100 days, we went directly to the source, interviewing several PE-backed CFOs. Each of them emphasized the need for top-notch technical skills, but they also universally agreed that financial talent alone is not enough. Regardless of your CFO profile or the industry, investor, or business specifics involved, CFOs must demonstrate from day one equally important non-financial qualities to establish a successful PE-backed tenure.

Dedicated Communication with Stakeholders

As an incoming CFO, “every interaction, every transaction, every presentation is an opportunity to be successful,” according to Allen Whitehead. As CFO at Versant Diagnostics, he is emulating the best practices of a mentor CFO, his former boss, who taught him the importance of communication. He says, a new CFO who is learning the business and identifying its key drivers inevitably needs to gather information from other areas, which are often wary of such requests. Whitehead’s goal as CFO is to break that cycle of mistrust by explaining why finance is asking for data and listening to others’ concerns.

Craig Levy agrees. As a full-time interim CFO currently serving Fluence Automation, he experiences the first 100 days more frequently than most CFOs. Whether it’s dealing with a global pandemic days after taking the job (which he did) or driving some other transformation, it requires two-way communication during which the CFO builds rapport to develop valuable partnerships. From the get-go, “Partnering is a big deal because you can’t pull off an initiative on your own,” he says. “You need critical mass.”

Introductory and ongoing one-on-one meetings with company leadership and direct reports help establish these healthy relationships, says Ben Bier, the CFO of Soleo Health. He speaks with his CEO on a daily basis and has established weekly meetings for both the C-suite and the board that provide regular forums for communicating updates and raising concerns. As for his weekly staff meetings, Bier invites cross-functional partners to attend, which ensures dependencies get factored into all decisions.

Perceptiveness and Agility

Although the financial mechanics may be the same, every situation that an incoming CFO faces can differ in terms of culture, people, and talent. Within the first month, Levy develops an initial impression of it all based on his experience. He spends the second month confirming or adjusting his hypothesis. Whitehead calls this “the mindset of being prepared to go” the minute you step through your new employer’s doors, or “right out of the gate” in Bier’s words.

Without the ability to quickly grasp the actual reality, not necessarily the rosier picture presented during the CFO search, it’s difficult to distinguish immediate priorities from less critical ones.

Levy experienced an extreme example of this when a typical interim CFO assignment turned into a longer mission due to the COVID-19 pandemic. Shortly after coming onboard, stay-at-home orders ground normalcy to a halt. “We had to pivot within days,” he says, to deal with the existential priority of that particular first 100-day period: preserving cash. The PE investors and senior management, some of whom were also investors, relied heavily on Levy to navigate the unprecedented situation, which meant keeping his wits about him in the face of monumental uncertainty.

Strong, Transparent Leadership

In ordinary as well as extraordinary times, PE investors expect CFOs to add demonstrable value to their platforms, and that takes leadership to deliver. Our three interviewees share examples of how CFOs can lead from the very beginning of their tenure:

  • Create a vision for the future that everyone can rally around
  • Assess finance staff capability and give them the resources they need to succeed
  • Establish credibility with the board members, peers, and direct reports by being honest
  • Deliver good and bad news at the same speed, which proves trustworthiness
  • Find and eliminate sources of rework to free up staff time for more strategic, value-add tasks
  • Create alert systems that identify developing issues before they become dire emergencies

Levy succinctly sums up what it means to outperform expectations in the first 100 days in a PE-backed firm: “I can use a ten-key with the best of them, but it’s finding a solution where somebody previously didn’t think one existed.”

Whether you’re a PE firm searching for an interim or permanent CFO to elevate financial performance in the first 100 days in your employ, or you’re a finance professional looking to make an immediate mark in your next CFO role, Focus Search Partners is here for you. So, join us in building teams that grow companies.

 

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