CFO THOUGHT LEADER

CFO Michael Cox reflects on the need to upgrade the guiding philosophy for acquisitions, considering the increased cost of debt. Speed to value becomes crucial for M&A success. The podcast also touches upon Cox's past experiences at PwC and his role as CFO of IRIS Software Group. The evaluation process for potential partners and acquisitions is discussed, along with personal habits like running and setting goals. The importance of not becoming complacent is explored through real-life business examples. The CFO also discusses plans for growth, infrastructure support, and data democratization.

When David Parsons tells us that he remains concerned about the whereabouts of his 20-something-year-old self, we realize that our talk with Zuto’s CFO is going to be different from most of those that we undertake with today’s finance leaders.According to him, “Thirty-nine-year-old Dave is looking at mid-20s Dave and asking, ‘What are you thinking?!‘”Some further probing on our part reveals that “mid-20s Dave” was roaming the English countryside on weekends as part of a wedding band, as well as a member of other assembles—including a popular Michael Jackson tribute act.   “I just went down this rabbit hole where I was working weekends as a musician and doing studio work in the evenings,” explains Parsons, who adds that his weekend music tours would often book-end 70-hour workweeks in corporate finance.“I don’t mind working the hours, if I get to do what I love doing,” continues Parsons, who began serving in a succession of FP&A roles once he was safely beyond his 20s.“I have not necessarily built my career by trying to fill niches and gaps on my c.v., which is, by the way, a good way of going about things—but it’s just not for me,” remarks Parsons, who notes that he began to find his work increasingly satisfying as he moved into a number of commercial finance roles, which eventually led him to accept a position with UK-based automobile finance and loan company Zuto.“Basically, we begin by placing a customer with a lender and a preapproval, which means that we can tell them with a very high degree of accuracy whether the lender is going to accept them,” reports Parsons, who points out that Zuto deploys a sizable team of car-buying experts who can offer customers one-on-one service for vehicle history checks, free vehicle valuation checks, and the like.Parsons recalls that at the time that the CFO role opened up at Zuto roughly 5 years ago, he was overseeing FP&A. Nonetheless, although the company was evaluating other CFO candidates, he knew that in the end he was a good fit—and not necessarily because of his familiarity with the business.Says Parsons: “It really comes down to being a cultural fit, and for me, I found that this business is doing something that I believe in.” –Jack Sweeney

When OpenAI, the creator of ChatGPT, recently announced that it would be opening its first office outside the U.S., few who were roaming the tech corridors of Silicon Valley likely were surprised that the generative AI company chose London for its new outpost.As a backdrop to the decision, British Prime Minister Rishi Sunak has been energetically pitching the UK as the intellectual and geographical “home” of AI, at the same time that UK executive recruiters have been busy compiling evidence to convince tech prospects that the UK is on the verge of becoming the next Silicon Valley.Such claims are bold moves indeed, but ones for which a resume such as that of American Michael Bannon might serve the recruiting community as “Exhibit A.”  A quick glance at Bannon’s bio reveals a familiar professional trajectory, from his 11 years as an investor with TPG Global of San Francisco to the operations side, where to date he has occupied the CFO office at three different tech firms. Other noted Bay Area laurels have included an MBA from Stanford and board seat with Meals on Wheels, San Francisco (2013 to 2017). Bannon’s resume is one that any aspiring Silicon Valley CFO might hope to someday replicate, although any peruser of it would also note that his professional journey has also been a geographic one.   “My assumption was that I would end up in the Bay Area, but one of the conversations that I had was with a London-based company—and you know how one conversation can quickly lead to two or three,” explains Bannon, who after 6 years in the UK recently opened his third CFO chapter with SaaS software developer Typeform.Still, based in London, Bannon points out that as the UK’s tech community has expanded, so too has the “weight class” of tech companies that he now prefers as a finance leader.“I love this size of company because I think that there really is an opportunity for each of us here as an individual to have an impact,” he notes, going on to give little to no mention of his geographically nomadic professional path. “I love building teams and building organizations—and so far, the companies of which I’ve been a part have grown significantly over the periods of time when I have been with them.”Says Bannon: “As an American who was based out in the Bay Area for close to 15 years, to now get to see the tech scene over here in Europe is a pretty special thing—it’s where I feel that I can be additive, given my previous experience.” –Jack Sweeney 

When Jeff Noto is asked to reflect back on his 35 years with Verizon, he tells us that his earliest years with the company were spent scoring quick returns on investments that Verizon had made inside its fledgling wireless business.“I always have to chuckle when I think back to how certain people thought that wireless would not be a product for very long,” comments Noto, who notes that being able to demonstrate speedy returns on investments became critical to securing future investments and for building the business case that wireless would someday soon be a viable alternative to “wire line” services.  “Now, look at things from where we sit today, when everything has been reversed and wireless now provides the main means for communication—that is, at least from the perspective of from the handset to the tower,” observes Noto, who would climb the ranks at Verizon as an FP&A executive to eventually serve in steady succession of business unit CFO roles.Asked why—after 35 years with other duties—2023 became the right time to step into a CFO role, Noto replies: “It was just a funny intersection where all things came together after the world had turned during my very long career with Verizon.”For Noto, it was time to look beyond the “handset to tower” space and all of the other familiar communications pathways.“From there, it becomes all about fiber-optics—and that’s what we do at Zayo,’ continues Noto, drawing our attention to his recent CFO appointment at the fiber-optics and network infrastructure company.Says Noto: “I don’t know that there could have been a company other than Zayo that I would have left Verizon for—this is a great opportunity.”No doubt this is a blush-worthy compliment, yet—coming from someone with 35 years at a single company—many of us are inclined to take Noto at his word. –Jack Sweeney

Among global management consulting firms, Boston Consulting Group—long recognized as one of the world’s top three “strategy houses” (along with McKinsey and Bain)—has remained an attractive early career chapter for many executives who wish to accelerate their learning by consulting to senior corporate leaders.   Such was the path taken by Sapna Kapur, who in 2007—after 4 years with Kurt Salmon and then 4 with BCG—exited management consulting in search of a corporate operations role that would allow her to apply the expertise that she had gleaned from years of serving a variety of corporate clients.At the time, Kapur could not have known that she was about to make what will more than likely be her professional life’s biggest investment of career years with a single company—nor could she have realized that upon completion of this 12-year stint, she would in short order become a CFO.Kapur’s sizable investment of career years with a single company is not unlike similar sojourns made many of the finance leaders who have shared their career journeys with us. However, what intrigues us is that she established this track record and fed her budding CFO ambitions while an employee of Google from 2007 to 2019, a span of time during which the company grew from $20 billion to $182 billion.“I joined Google when it was just starting to take a bit of a breather in order to better think about the ways in which it could grow to the next level and explore questions like, ‘Should we go for growth by 2X or by 5X?,’” recalls Kapur, who notes that the original Google operations team that she joined was made up of executives with consulting roots just like her own.“We were needed to really drive some of these types of growth explorations to better inform the leadership team at Google,” explains Kapur, who within 3 years of joining the company had begun to serve in a succession of finance roles.   Listeners will undoubtedly find Kapur’s insights into Google’s use of small teams of keen interest, as well as the collaborative nature that she regularly transmits—an attribute that she seems to take for granted.  While time limitations may not have allowed us to track the roots of Kapur’s “collaborative skillset,” we suspect that professional peers might tell us that not unlike Lady Gaga, she was “Born This Way.” –Jack Sweeney

This episode our cohosts Brett Knowles and Jack Sweeney explore the insights and commentary from three finance leaders: CFO Michael Bannon of Typeform, CFO Chuck Fisher of Turo, and CFO Jeff Noto of Zayo. The episode discusses the importance of identifying unique and key metrics for businesses, moving beyond common knowledge. Meanwhile, the cohosts discuss some of the fast moving developments when it comes A.I technologies and the planning process.  Planning Ace Michael Bannon emphasized the need for sharing information across the organization, ensuring alignment and effective decision-making. Planning Ace Chuck Fisher highlighted the metrics related to profitability, cohort performance, and customer retention in the peer-to-peer car sharing marketplace, Turo. Planning Ace Jeff Noto details his focus on finding actionable metrics that drive efficiency and better decision-making, as well as prioritizing profitable growth and identifying valuable data for operational improvement.

The meeting that Chuck Fisher brings to our attention began not unlike hundreds, if not thousands, of other meetings that he has sat in on during his 25-year business career.However, it was at one particular gathering that he witnessed the thinking that would trigger one of the last decade’s greatest strategic bets.Back in 2013, Fisher had only recently joined the business development team at Charter Communications when he found himself in a meeting that included Charter’s then-CEO, Tom Rutledge.The meeting had begun, like many others, with Rutledge highlighting a number of Charter’s recent “wins”—before his message became far more nuanced. Fisher recalls Rutledge saying, “The thing that we need to understand as a company is that we can be the best operators in the business—which I think that we are—but as long as we’re subscale, we’re always going to be playing the game by someone else’s rules and we will never have a seat at the table to define the direction of the industry.”It was later in that day—or perhaps a day or two later—when the Charter M&A team began to contemplate the acquisition of Time Warner Cable, a company roughly four times its size.“It was audacious to think of Charter as the acquirer, inasmuch as every logical design as far as how industries evolve goes would have had Time Warner acquiring us,” explains Fisher, who adds that the Time Warner deal ultimately took 3 years for Charter to complete.Along the way, Fisher reports, there were plenty of headline-grabbing twists and turns, but the organization stayed focused.“We believed that we were the better operators and had a better strategy,” remarks Fisher, who turns our attention back to the early meeting with Rutledge, when the CEO made Fisher and others realize that Charter’s operations edge wouldn’t matter unless the company did something bold to “move the needle.”“Our one big question became, ‘How do we fix things?,’” continues Fisher, who observes that Rutledge’s insights brought clarity to the transformative role that a deal the size of the one involving Time Warner Cable could play in the company’s future.Says Fisher: “Those comments became the guiding principles for us as an organization.” - Jack Sweeney

When Alex Triplett is asked to explain where and how he began acquiring his operations knowledge, he tells us that his ops focus began to sharpen as more and more roles demanded greater “specificity” of him.Back in 2006, Triplett had just completed a stint as an investment banker with Citigroup when he was hired by private equity firm TA Associates as an associate inside the firm’s enterprise software and fintech realms.“Fintech forced me to get closer to the product itself because I couldn’t be credible otherwise,” recalls Triplett, who notes that very often the company founders across from whom he sat at meetings had other options when it came to sourcing investors, so the ability to demonstrate some depth when it came to product knowledge became essential.  “I got used to it being about product, product, product,” continues Triplett, who tells us that even today, his TA years bring to mind volumes of product literature and a steady stream of software demonstrations.Still, Triplett reports that the specificity that he was able to nurture when it came to actual product knowledge was of little aid to him when discussions turned to the different operational challenges that certain founders were confronting. He attributes this void to what might be deemed the familiar investor–operator gap.“They were great investors, but they didn’t always know how to give specific advice to a company that was trying to understand whether to pivot right or pivot left,” remarks Triplett, who says that it was his growing appetite for operations knowledge that ultimately led him to leave TA and join the corporate development team at financial services software company Ion.In the years that followed, Triplett was at times tasked with being general manager of various newly acquired businesses—a succession of assignments that eventually would empower him with the specificity required to emerge as an operations troubleshooter.  “It’s great to be able to analyze the shape of things from 10,000 feet and glean insights using pattern recognition,” Triplett observes, “but do you actually know how a business works?” –Jack Sweeney 

We often like to ask our CFO guests if they remember the first time that they presented to a board of directors. For many, this happened earlier than you might expect—but few of our interviewees have exposed the benefits of “early access” for us better than Rex Jackson.“I grew up in boardrooms,” comments Jackson, who recalls being invited to his first board meeting when he was about 28.Jackson had spent 3 years at a Los Angeles law firm before signing on as a corporate attorney for a local real estate management company whose board had a budding appetite for M&A.  “For any deal that they wanted to do, I became the ‘Get It Done Guy,’” explains Jackson, who notes that his moniker in the boardroom soon began to apply to more than just M&A.“When an opportunity to land on a clear track northward within an organization presents itself, you just jump all over it,” remarks Jackson, whose early career endeavors swung open the door to a succession of general counsel roles at a variety of companies.Along the way, his “get it done” mantra helped to add some noticeable addenda to his legal career track.Jackson explains: “One time, I ended up as a salesperson; another time, I had to head up marketing. I have run R&D, I have run operations, I have run corporate development.”  It perhaps should come as no surprise, then, that when an interim CFO position opened up at publicly-traded Synopsis, Jackson—then the firm’s general counsel—shot up his hand. While he would occupy this particular role for no more than a year, within 13 months of concluding this interim tour of duty he was stepping into a CFO position at yet another publicly-traded company.Just as at Synopsis, Jackson’s next chapter began with a CFO exit.“Within 6 weeks of my arrival as a new general counsel, the company shot their CFO,” reports Jackson, who subsequently was asked by the company’s board to move into the CFO role. This time, Jackson would occupy the office for roughly 3-1/2 years.“It was at this point that I became visible on recruiter radar screens,” comments Jackson, who has to date served as CFO at four other companies, including ChargePoint, where he has been CFO for the past 5 years.Says Jackson: “I’ve had good support from CEOs and board members, and if you can get this kind of access and observe the business from a high level, then finance—since it’s horizontal within the business—will serve you well.” –Jack Sweeney

As John Rex tells it, when he first arrived inside the finance function at Microsoft Corp. in 2007, one executive greeted him with “Hey, welcome to Microsoft—if you’re still here a year from now, let’s reconnect.”A senior finance hire with experience in manufacturing and consumer products at such companies as Novartis (3 years) and Kodak (14), Rex was to find the message behind the conditional invitation particularly prescient only 12 months later, when he “very nearly got the boot.”    Seated across from his boss, Rex was “read the riot act” for having absorbed what the boss deemed to be only “superficial knowledge” of the developer’s plus-size menu of products and services.   “I knew that he was right, and I realized that what had gotten me ‘here’ wasn’t going to be enough to take me ‘there’—and that basically I had to go back to college,” explains Rex, who adds that during the months that followed, he spent nights and weekends learning everything that he could about the nuances of the “go-to-market” model  and the licensing approaches that governed the company’s flow of revenues.  Still, Rex tells us, he understood that in order to succeed as a finance leader at Microsoft, he needed to dramatically overhaul the management approaches and operating style that had served him well for the first 20 years of career.He continues: “I was accustomed to having information flowing toward me as a key decision-maker, whereas at Microsoft, interestingly, there was a much more egalitarian type of culture. All of a sudden, I couldn’t depend on information flowing to me. Instead, I had to become a very proactive consumer of information.”To increase the flow and absorption of information, Rex spent more time every day in reaching out to others in sales and product development, while at the same time allowing himself more “alone time” for consuming new information.In fact, Rex found that “alone time” was an important tenet of the Microsoft culture that underscored its founder’s wish to have the company achieve the feel of a university, where every employee had dorm room—aka office—to which to return.  Today, Rex views the hypothetical 12-month tryout period that the Microsoft executive attached to his arrival welcome as being not malicious but simply honest, given that the retention rate of Microsoft senior hires at the time was less than 40 percent.Says Rex: “In the end, I became not just a much more effective leader but also a more credible one because I understood the business much better than I had before.” –Jack Sweeney CFOTL: As a former CFO and now ongoing C-suite leadership coach today, how do you feel that CFO leadership has changed over the years?Rex: Well, I’m going to take the liberty of extrapolating what I’m observing about leadership and applying it to CFOs because I have a very hard time in separating CFOs from other senior leaders. There are some things that they all very much have in common, but let’s look at things from the perspective of the CFO.Over time, particularly in American business, we reward people for knowing their stuff. Now, there’s nothing wrong with this. You need to know your stuff. I myself really needed to bone up and know my stuff at Microsoft. Doing so is just vital.The evolution that I see happening in the business world—and this fully applies to CFOs—is that the best leaders are developing this combination of subject matter expertise and deep curiosity. This allows them to show up with what I call “humble confidence.” They are very, very confident in their subject matter expertise, as they should be and as they need to be, because this is required of them. But they are also extraordinarily curious about the vast universe of things that they don’t know. Maybe this is the marketplace; maybe it’s opportunities. They just have insatiable curiosity. As a result, in virtually every instance they show up not as arrogant—even though they know so much—but as humbly confident and curious.So, whereas the CFO of years gone by would often show up as the know-it-all with a tell-people-what-to-do, tell-people-what-not-to-do kind of attitude, I would say that today’s CFO is hypercurious about what’s possible for their enterprise, for their market, for their customers, for their organization, and for their people. They’re bringing curiosity to every conversation. This leads them to take an approach that is much less interrogatory than it used to be.When I was growing up in the corporate world, it seemed to me that the job of senior leaders was to interrogate everybody else. Every time I went to a strategy review or quarterly performance review, it felt like a dental visit. The best leaders today have a different approach. They’re just wildly curious about everything and bring this mind-set of curiosity to every conversation. This has a multiplying effect because it encourages people to think beyond their normal boundaries—including those involved with rank and privilege and propriety.In other words, people used to think, “Oh, I can’t say this because the CFO is in the room” or “I can’t say this because it’s inappropriate for me because I’m too junior” or whatever. The effective CFO today is blowing past this to cultivate a group mind-set of “Let’s talk—let’s explore together.” I’m a huge advocate of this approach that they’re cultivating, which is called “mutual learning.” This doesn’t mean that they abdicate their responsibilities or don’t appropriately wield their authority. They have to continue to do these things, but they don’t do them in an arrogant, know-it-all kind of way. The result is that they just generate so much more out of the people whom they lead.