CFO THOUGHT LEADER

When Robert Alvarez first joined the finance team of one venture-backed start-up, he was thinking that one day he might like to be a CFO. However, upon further reflection, the young finance analyst realized that he had little idea what a CFO did.

Being part of a start-up team afforded him the opportunity to have one-on-one meetings with different senior leaders, including the company’s CFO, Alvarez recalls. Of course, access to leadership has little value unless you are willing and able to undertake the responsibility of shepherding a future deliverable.

For Alvarez, the task of identifying such a deliverable was best left to its intended recipient.

“We were together going down the list of items that I was working on, and I stopped and asked the CFO, ‘So, what’s on your list?’” remembers Alvarez, who says that the CFO subsequently began listing one item after another.

Alvarez says that he asked if he could “take a stab” at tackling one of the items and told the CFO that he would have it for him by the next day.

Having identified a valuable action item and promised to deliver it promptly, Alvarez asked the CFO not to fix the item if it ultimately fell short. Instead, Alvarez says, he was eager to discover what mistakes may have been made to learn from them.

“We began with that one item, which quickly became two—and soon I was working on parts of board presentations and different materials for investor relations,” comments Alvarez, who notes that the experience was contingent on a finance leader willing to give up something.

Says Alvarez: “He gave me the gift of letting me do his job, which was critical because I’m not smart enough to just read how do things—I’ve always had to do the work.” –Jack Sweeney

Troy Ignelzi’s CFO career is rooted in an unlikely place. In fact, some might describe it as the least likely of all places, for the environs of his early vocational path were not those of a growing company but instead a place where businesses had stopped growing.

So it was in Kalamazoo, Michigan, in the late 1990s when Ignelzi—part of a local economic development team—became tasked with creating jobs in the wake of Pfizer’s decision to remove a number of business operations from the region, including a large plant.

“They moved all of the R&D jobs and everything business-related out of Kalamazoo and Portage, Michigan, and all they left was a very large manufacturing plant,” explains Ignelzi, who notes that the move by Pfizer began putting the area’s larger biotech sector at risk.

“What happened was that this big vacuum got created, so what we said was, ‘Let’s keep these other smart guys in town,’” continues Ignelzi, who adds that preserving the region’s biotech jobs became part of a bigger project known as the “Pfizer Disaster Relief Plan.”

As Ignelzi diligently worked to crack the code for job creation inside the biotech realm, he increasingly found his interests leaping well beyond the region’s economic ebb and flow.

Comments Ignelzi: “What first drew me to economic development was the idea of helping companies to create jobs and making a difference. Then this passion kind of spilled over into companies in the pharmaceutical and the biotech worlds, where firms were developing life-changing medicines.”

To date, Ignelzi says, he has helped to lead the financing of six approved drugs representing different therapeutic areas and has helped seven different companies to go public. 

Meanwhile, it’s clearly a point of pride for Ignelzi that Kalamazoo’s once empty biotech plant is today playing a part in the greater biotech community’s COVID response.

Says Ignelzi: “It’s that same manufacturing plant that is now making the pandemic therapy that we’re all hoping gets us through this right now, right down the street from where I still live, in western Michigan.” –Jack Sweeney

When Evan Fein accepted his first CFO position more than a decade ago - his focus as a finance leader was too narrow according to the CFO, who in a moment of self-reflection can’t conceal his exacerbation.

 "Ashamed is not the right word, but I'm such a better CFO now than I was then,” remarks Fein, who gives his younger self some kudos for having helped to champion the company’s business model as well as extending the organization’s lines of sight into the future.

Still, there’s little question Fein finds the notion of time travel appealing.

“What I would now tell my younger self is that the CFO role is about the ability to partner and build relationships and grow other people. That is the special sauce that I bring to my job now,” Fein comments.

Asked to better expose his former CFO mindset Fein says: “At the time, I decided if everybody stayed in their swim lanes and we each ran our trains on time, that things would come together. It’s just not that simple.” – Jack Sweeney

Michael Rosen’s finance career began inside the loan department of middle market lender Union Bank (now MUFG Union), when—after completing an 18-month training program—the 23 -year-old was provided with a stack of business cards bearing the title “Loan Officer.”

“At the time, being a loan officer meant a great many things. You would be responsible for most of your clients’ needs, as well as bringing in new business for the bank,” remembers Rosen, who today credits the program’s scope with allowing him to quickly find his footing inside the bank’s apparel sector—a realm made up largely of midsize businesses ranging in size from $15 million to $100 million.

“It was a significant program that provided some broad-based training in things like financial analysis, collateral analysis, and financial accounting, as well as the legal and ethical issues that come up when running a bank,” continues Rosen, who adds that for the next 7 years he responded to the unique needs and growing pains of his midsize customers.

Next, Rosen joined CIT Group, which at the time was aggressively expanding its factoring offerings. The financial services firm was known for not only taking over its clients’ accounts receivable but also signing outsourcing agreements for the customers’ credit collections and bookkeeping functions.

“Once we were doing all of these things, it became a lot easier for us to make loans against the collateral because we were the custodian of all of the funds. We didn’t have to rely on companies collecting the money and then sending it—instead, it came right to us,” he recalls.

The experience of serving customers at CIT Group opened Rosen’s eyes to managing risk and the critical thinking that’s often required when advising businesses “where things aren’t going well.”

It was through just such a business that Rosen accidentally discovered a door of entry to corporate finance leadership.

“We kept telling the owner that the business really needed to have a CFO, and the next thing I knew, I was offered the job,” explains Rosen, who accepted the position. Looking back, Rosen says that at the time he probably did not have all of the technical accounting knowledge that a CFO might be expected to command. Even so, he knew how to stabilize the business, and that’s arguably what mattered most. –Jack Sweeney

CFOTL: Tell u

Brett and Jack discuss the marriage of fintech and human capital management, and the of the growing mandate for employee success.  Featuring the commentary and insights of workplace champions CFO Sameer Ralhan of the Chemours Company, CFO Robert Alvarez of Big Commerce, CFO Laurence Capone of Pipedrive.

When Thomas Kramer recalls his decision to leave his job with a prestigious consulting firm to start up a tech firm in the final hours of the dotcom boom, he doesn’t hesitate to underscore his decision’s questionable timing.

“This was when I realized that I would be getting out of consulting at what potentially would have been the worst possible point in time. Everyone could see that the Internet boom was closing, and smart people do what smart people do: They run in the other direction,” recalls Kramer, now some 20 years later.

Whether it’s quantum bits, IPOs, or even SPACs, the exciting developments surrounding IonQ are no match for CFO Kramer’s insightful personal advice and often biting self-reflection. 

“Travel is something that you do when you can,” explains Kramer, who tells us that during those times when his career has dispatched him to different parts of the world, he has frequently combined work and leisure trips.

At one point back in the early 2000s, when he discovered that he was not required to be in Delhi, India, for another 48 hours, the avid traveler made a pit stop in the United Arab Emirates. 

“I stopped off in Dubai and then I drove to Oman,” he reports, “because, hey, when else are you going to get to go to Oman?” ­–Jack Sweeney

CFOTL: Tell us about IonQ … what type of company is this?

Kramer: This is one that I love to get at cocktail parties because we actually shoot lasers at individual atoms and use these as building blocks to create the computer of the future. And I’m not kidding about the lasers or the atoms—this is what we do. We literally manipulate the smallest entities in the universe to create the largest-capacity supercomputers in the world.

Why is this important, because who cares about computers? You can go to Best Buy and buy another one every day. But the problem with computing is that “more slow” hasn’t been working for a while now. There are just physical limits to how many transistors you can put into a chip, and transistors are the basic building blocks of traditional computers. Transistors or bits are pretty limited in their function, though. They’ll assume the value of only zero or one, and to paraphrase Katy Perry, they’re off or they’re on.

Famously, quantum bits can be both zero and one at the same time—and also any value in between. This means that they can hold much richer information and therefore be used to compute much, much more complicated problem sets.

I’ll give you an example. Most UPS drivers can make about 120 deliveries per day. The potential combination of stops is expressed as a mathematical function by multiplying 120 by 119 by 118, and so on. The result far exceeds the age of Earth in nanoseconds. The practical implication of this is that if UPS or FedEx tried to calculate the optimal world for each of their more than 100,000 drivers every morning, all packages would’ve been delivered weeks ago, before the fastest supercomputer could ever give you the answer.

This is where quantum computers come in. They can handle a much larger data set simultaneously than your traditional computer can. When you go public, it’s a moment of profound commitment because now you’re really stuck, now you have to make it work. And that’s what I want to see happen here. We can go public. We will be trading. But what’s important is that we can bring out the best computers in the market for decades to come. And we as a finance function can help to make this happen.

In the wake of an economic downturn, a company’s door of opportunity swings open to a finance up-and-comer. This is a familiar early career chapter for many finance leaders, and few have revealed to us the uncertainty surrounding the moment better than Apptio CFO Kurt Shintaffer

“The CEO came to me and said, ‘Do you think that you have what it takes?’ I said, ‘Well, sure!,’ without really knowing what I was signing up for,” explains Shintaffer, who back in 2002 was a senior finance executive for Pacific Edge Software when the company’s then-CFO exited.

Until this moment, Shintaffer’s resume arguably had resembled those of thousands of other finance career builders stationed along the different rungs of finance’s corporate ladder, and like Shintaffer, may have completed a stint in public accounting. (Shintaffer spent three years with Ernst & Young).  

Still, at 28 years of age, Shintaffer was already aware that his technical knowledge was not what would make the difference in the days ahead.  

“I had to rely on all of the relationships that I had built to help me find my way. I was super-open about what I didn’t know, and I tried to learn from other people. I think that when you sort of make yourself vulnerable like this, people lean in for you,” remarks Shintaffer, while recalling the mind-set that he quickly acquired to meet the challenges ahead.

Meanwhile, his ability to be calm under pressure began to become evident as his appetite for multitasking grew, and he found his relationship with the business changing.

Says Shintaffer: “I was able to stay just far enough ahead of all of the things that were coming at me so that I could at least create this illusion of control, and I think that even to this day there are still some times when you just have to stay one step ahead.” –Jack Sweeney

Twenty years ago, when Roy Simmons first joined General Electric Company as a rookie financial analyst, it likely would have been difficult to imagine that he would someday occupy the CFO office of GE Lighting.

Of course, occupying the CFO office of “GE Lighting, a Savant company” would have required the young analyst to be endowed with not just imagination – but a crystal ball. This being said, in 2019, when a more seasoned Simmons joined the former GE business (now owned by Savant Systems, Inc.) as CFO, he had little trouble imagining a list of finance leader priorities for the coming year.

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“We’ve been together for the last 14 months and we together have a vision to bring that brighter life to the people,” explains Simmons, who spent a combined 18 years at GE, a span of time during which he served in a number of senior FP&A roles including one with GE Lighting.

“Back in the lighting days, we realized that our customers who bought lights for their businesses were also finance professionals and operating professionals who had goals, so we asked ourselves, ‘How do we sell lights better than anyone else?’ and ‘How do we actually create a meaningful opportunity to provide value to the customer?,’” recalls Simmons, as he begins to outline the thinking behind a strategic pivot from GE’s past.

Says Simmons: “Normally, a customer would say, ‘We’re just going to go buy a series of new lighting fixtures for our parking lot, and this will cost me $100,000.’ However, what if instead we went to a customer and said, ‘Rather than spend $100,000 on lights, how about a solution that means that you’re going to save $40,000 a year in energy consumption?’”

According to Simmons, the GE team narrowed its lens in order to target CFOs and other operationally minded executives with a commitment to deliver the customer savings within two and a half years.

“Sometimes we could get it down to less than a year. Sometimes it was a bit longer, but by doing it this way, we changed the paradigm on selling,” comments Simmons, who credits the solutions approach with helping GE to land a landmark deal valued at $180 million¾a hefty price tag for what Simmons describes as “the largest lighting deal ever closed.”

Looking back on the approach Simmons says: “It really brought to life a solution for customers that has survived past those days and which has now gone on to morph into a company that’s today outside of General Electric Company in a different capacity, and it set a paradigm in an industry that had been thinking of things in a singularly focused way and changed them.” – Jack Sweeney

It was after he had worked 3 years as an investment analyst with Bear Stearns and spent more than 2 years inside the corporate strategy bullpen of The Walt Disney Company that Craig Abrahams decided to head to business school.

However, Abrahams says that unlike many of his future classmates, he had made up his mind that hedge funds, investment banks, and strategy consulting firms would not be on his preferred menu of postgraduation career opportunities.

“I wanted an opportunity to work really hard and stand out but also to go somewhere a little bit different, where I wasn’t competing with 10 versions of myself,” explains Abrahams, whose earlier experiences at Bear Stearns and Disney had left the MBA student searching for a less traditional route to career success.

Observes Abrahams: “I was looking for a place where I personally could have an impact.”

That place became Las Vegas, where upon graduation Abrahams joined Caesars Entertainment as a director of broadcasting and new media.

“This was about putting myself in a position where I would be in the right place if an opportunity came along,” comments Abrahams, who within 6 months of joining the gaming giant was tapped to help launch Caesars Interactive Entertainment.

“I remember when Gary Loveman, the CEO of Caesars at the time, said to me, ‘There’s an opportunity to work on a business plan to create a new entity,’ so that opportunity fell into my lap,” remarks Abrahams, who had served in a number of corporate development roles before advancing into the new entity’s CFO office.

It was as CFO of Caesars Interactive that Abrahams first became acquainted with a small Israeli company that had a megahit mobile game known as Slotomania.

Caesars was smitten and in 2011 acquired the Israeli firm, Playtika. Over the next 5 years, Caesars Interactive invested more than $300 million into the business, which allowed Playtika to complete a series of acquisitions that led to the sale of the company for $4.4 billion in 2016. “This was just the first step in the evolution of Playtika,” explains Abrahams, who joined the newly private firm as CFO in 2019 and subsequently spearheaded a debt raise of $2.5 billion. The company was able to pay investors a dividend before management became focused on taking the company public, a goal that would be realized early in 2021. –Jack Sweeney

Unlike many of the up-and-comers who populate the corridors of The Chemours Company, CFO Sameer Ralhan spent the balance of his career building years with the company inside its manufacturing plants.

It was there where Ralhan says that he observed everyday executives making decisions that routinely impacted the business, and it was there where his M&A activities allowed him to imagine new avenues for value creation.

Says Ralhan: “The heart of this company beats at the plants.”

Still, the many hours that Chemours’s future CFO spent there made him aware of a growing disconnect between finance and the plant’s decision-makers. 

According to Ralhan, Chemours, not unlike many U.S. manufacturers, had undergone decades of reorganizations designed to streamline and centralize its operations. However, one consequence of this was that the bond between the plants and the Chemours finance team had become weakened.

“It was really limiting the finance support at the site and undermining decision support that could really drive the right financial outcomes,” recalls Ralhan, who after stepping into the CFO role made reallocating finance resources to support plant decision-making a priority.

Ralhan reports that one of a number of Chemours businesses that have benefited from the reallocation has been the chemical company’s Advanced Performance Materials (APM) business, where the finance and the operations teams came together to build new decision-making models as well as return-on-capital models for each manufacturing site.

Observes Ralhan: “These models really provided the insights to drive the right decisions, and this is evident in the margin improvement that we're seeing today in the APM business.”

Meanwhile, the Chemours manufacturing sites, as well as their bottom lines, are expected to benefit in the coming years from different digital tools and applications that promise to build on APM's recent margin improvement success.

Comments Ralhan: “Once you achieve this, you earn the right to do more things, and that's what I'm really excited about.” -Jack Sweeney