It’s no surprise that the majority of the assignments we handle, both within executive search and interim management, are in finance.
The private equity investor is naturally focused on the numbers; the language they speak is dominated by KPIs, figures, cash, profit, budgets, forecasts, data, data and more data.
They naturally look to finance first when building a portfolio management team. It’s fundamental; no portfolio company can expect to embark on a strategy without first understanding the financial foundations of the business, and no investor wants to put time and money into a business unless they believe it will generate a significant return on exit.
Investors, then, require a technically brilliant CFO with impeccable qualifications and a wealth of experience.
But this skill set doesn’t necessarily come with personality.
The portfolio company also has a list of ‘must-haves’ for a new CFO; yes, they want the technical excellence and financial gravitas, but they also require another, very different skill set.
The CFO is the number two, a constructive challenger, someone who helps develop the commercial strategy as well as manage the finances. The CFO needs to be a natural leader able to deputise for the CEO; able to inspire and motivate and communicate the big picture. Today’s CFO is front facing and needs to be able to communicate on every level – from negotiating with banks to chatting on the shop floor.
As someone said to me recently, the CFO needs to be able to ride two horses.
The trouble is, finding someone like this isn’t always easy.
Identifying a commercial CFO
Career development programmes, training courses and such have their place in business. Much can be taught and learnt in this way.
However, to be completely successful, you have to go beyond this. The attitude, mindset and personal attributes have to be intrinsically within the character make-up of the CFO, particularly when considering the private equity arena where the stakes are so high.
Finding a CFO with a strong mix of technical, commercial and cultural skills is difficult – but not impossible. We have spent a long time working within the private equity arena. We regularly talk to mid-market private equity investors, chairmen and CEOs. We know what they are looking for.
What’s more, we know a lot of extremely successful portfolio company CFOs. If we don’t know them, we will find them, and because we talk their language, we’ll be able to engage with them.
Most importantly, we’ve painstakingly researched, identified and defined the ‘right mindset’ for private equity. We recognise a CFO with the qualities necessary to satisfy both the requirements of the investor, and of the CEO.
Someone who really can ‘ride two horses’.
Lisa Morgan, Director
News & Insight