A Chief Monetary Officer (CFO) place carries loads of duty, and all of the extra so at a fast-paced tech firm. Startup CFOs are tasked with driving a rising enterprise in the direction of success and profitability as rapidly as attainable, which is definitely no simple feat.
Whether or not you’re a budding entrepreneur searching for insights into this profession path, or a mid-career skilled aiming to enhance your abilities, there’s no higher method to be taught than to seek the advice of with a seasoned professional. To that finish, we’ve introduced you some unique ideas from TravelPerk’s present COO and former CFO, Huw Slater (LinkedIn).
Huw’s spectacular profession spans almost 20 years, together with 10 years in finance positions at BT Group, 3 years as VP of Worldwide Finance and Operations at Field, and CFO positions at Typeform and Travelperk. To be taught extra about Huw and his high ideas for startup CFOs, try his interview on Soldo’s podcast, “The CFO Playbook.”
Huw’s journey towards turning into an skilled CFO began in a shocking place: the College of Manchester’s physics division. Constructing on his lifelong curiosity in math and science, he graduated together with his BSc in Astrophysics in 2003.
So how did he shift his focus from the celebrities to the C-suite? After an opportunity encounter with a British Telecom worker and a dialog about rugby, Huw joined the corporate as a brand new graduate and kicked off his profession in finance. Starting as a Monetary Analyst, he labored his approach as much as ultimately develop into a Finance Director. Subsequently, he joined cloud content material administration firm Field as they have been increasing internationally pre-IPO. He then moved to Barcelona to take a CFO position at Typeform, earlier than turning into TravelPerk’s CFO and COO.
Whereas astrophysics and finance could seem to be very completely different topics, Huw has discovered some fascinating parallels between the 2. Each require sturdy analytical abilities, and the flexibility to dissect complicated info and break them down into core concepts. Additionally they each contain curiosity and asking the suitable questions.
In physics, velocity is the measure of each velocity and course. This is applicable to enterprise as nicely: to acquire outcomes, leaders must mix velocity with focus. Startup CFOs are tasked with sustaining a robust development trajectory in a corporation with many transferring elements.
One other physics idea that ties in nicely with an govt’s tasks is entropy: dysfunction, uncertainty, or randomness. In enterprise phrases, this implies managing the numerous distractions that come up each day. Paraphrasing Steve Jobs, Huw says CFOs should “say ‘no’ to 999 good concepts, to allow them to say ‘sure’ to at least one nice one.”
How TravelPerk overcame the pandemic problem
The COVID-19 pandemic was a significant problem for corporations in almost each trade, and journey was notably affected. Thankfully, TravelPerk got here out sturdy from the pandemic, while not having to make redundancies. So how did the management crew handle this disaster?
As Huw studies it, the TravelPerk crew had scheduled a board assembly for about 10 days earlier than the primary COVID-19 lockdowns began. At that assembly, management needed to deal with the unsure actuality of the pandemic at a time when few folks knew what the longer term would seem like. They put collectively some strategic planning for various situations in two phases and determined to quickly lower advertising and marketing and freeze new hires. They then agreed to present weekly updates to board members because the state of affairs advanced, planning to make extra important cuts in two months if circumstances demanded it.
A key consideration right here was long-term pondering. For instance, whereas layoffs may need eased monetary ache within the brief time period, they may have additionally damage the long-term well being of the corporate. As a substitute, the finance crew aimed to make strategic cuts in areas that represented excessive value financial savings and low influence. Additionally they made some shocking decisions, like doubling the scale of the engineering crew as an funding in future enterprise success.
In the end, the COVID-19 pandemic created a necessity for new varieties of enterprise journey. Journey-related spend tripled in 2021, and the market is predicted to develop much more in 2022. As corporations have shifted to full-time distant or hybrid fashions, there may be now extra of a necessity for inner conferences as distributed groups get collectively in individual for offsites, crew constructing actions, and extra. On this context, the way forward for TravelPerk appears brighter than ever.
At present, TravelPerk is sustaining its core focus whereas creating extra partnerships with corporations like Soldo (a spend administration platform with pay as you go firm playing cards). This manner, we are able to present prospects with a 360° enterprise journey supply, whereas staying true to what we do greatest. Utilizing our SaaS software program, finance groups can streamline their enterprise journey applications, gaining management and visibility over budgets whereas enterprise vacationers keep their autonomy. It’s a win-win state of affairs for everybody.
Why startup CFOs must grasp clear communication
At TravelPerk, we’re all about in-person connection and communication. That’s why it’s not shocking that Huw mentions efficient communication as one of many keys to succeeding as a CFO.
A part of this entails strategic transparency. There’s no query that transparency is essential in enterprise, and other people recognize it — a Paychex survey confirmed that 83.3% of staff with very clear employers have been happy with their jobs. Nonetheless, this want for transparency doesn’t essentially apply to each single problem: the survey additionally confirmed that staff have been principally involved with points that straight affected them.
In line with Huw, “excessive transparency” can rapidly flip right into a collection of undesirable distractions. Whereas groups completely must find out about key points, overloading them with irrelevant info will merely waste their time. Really efficient communication is about delivering the suitable info, to the suitable folks, on the proper time. Whereas this idea isn’t difficult, it does require dedication and work.
However, in relation to goal-setting and targets, it’s higher to err on the facet of “overcommunication”. Huw recommends a radically open and trustworthy strategy to sharing progress and context. This manner, groups can stay aligned and perceive why targets have been set the way in which they’re.
On a private degree, CFOs want to recollect to present themselves the house they have to be efficient communicators. Huw likes to put aside 45 minutes of “alone time” after he comes dwelling to chill out and rebuild his power. Nonetheless, he additionally finds that being round folks could be energizing — in the course of the lockdown, this grew to become particularly clear.
Setting targets and KPIs at a fast-paced tech startup
Whereas highly-ambitious targets are interesting to traders, these targets additionally have to be life like and achievable for the crew. The objective is not only to get folks to the following goal, however to allow them to work sustainably with out burning out.
At TravelPerk, the manager crew meets recurrently to brainstorm targets, then fingers them off to the prolonged management crew for suggestions earlier than finalizing. Whereas it’s inevitable that targets will probably be missed generally, it’s essential to maintain this in test — sometimes lacking a goal by 10% may work out, however lacking one by 50% can be very demoralizing.
Huw believes that targets should at all times be truthful. For instance, he recollects a state of affairs in a earlier job the place staff at decrease ranges of the corporate hierarchy got extra bold targets than their seniors. They might often miss targets, inflicting them to really feel disillusioned, whereas the administration crew would obtain bonuses. To keep away from one of these end result, Huw advocates for setting life like targets throughout the group, whereas being clear with each staff and the board of administrators.
To steadiness achievability with ambition, TravelPerk’s management crew allocates round 10% of assets to “moonshot targets” (extremely bold, progressive targets) and 70% to “incremental targets” (core, routine duties of the enterprise).
Turning into a profitable CFO within the tech world
If there may be one key objective startup CFOs have, it’s this: transfer sooner with fewer assets. After all, this can be a critical problem. To fulfill their goals, at the moment’s CFOs often select to spend money on software solutions like TravelPerk and liberate their staff’ time for higher-value duties.
You’re a pacesetter first, and a CFO second.
Huw Slater, COO at TravelPerk
What his assertion means is that, though CFOs are liable for accounting features, monetary planning and evaluation, metrics, and money circulation administration, a CFO’s high priorities ought to be communication and higher-level enterprise technique. Profitable CFOs ought to over-index on management by specializing in each crew targets and firm targets. The finance operate ought to assist the corporate’s general technique from a cooperative, reasonably than confrontational, standpoint.
Huw’s ultimate phrases of recommendation for finance leaders are:
Run in the direction of the flames… discover the toughest drawback that exists within the firm. Simply go and assist someone, get it performed. That’s the way you develop.
Huw Slater, COO at TravelPerk