A colleague once told me that as CFOs, we don’t really have measurable output. Salespeople have bookings, engineers launch products, marketers drive leads, manufacturing has a whole set of statistics. Our only product is integrity.
This saying is always playing in the back of my head when I’m asked to pull things in a certain direction. Can’t we show that cash will last 18 months instead of 15? Can’t we show that those months where we got rent abatements were profitable? Can we just up the size of a few deals in the pipeline so that it looks a little fatter?
It is difficult to push back against this sometimes. It is also difficult to push back against what you can show is expansion that is way too fast.
This happens all the time, and I mean all the time, in the SaaS world where companies flush with cash feel obligated to spend it as quickly as possible on a much bigger sales and marketing operation. Their investors often want this too. Sometimes growth does not materialize, for which there are usually adequate warning signs (examples – not enough leads per salesperson, salesperson tamp is taking way longer than expected). A good CFO can see this coming a mile away. But there is tremendous pressure not to “be negative”, so many say nothing. Then one day there is a reckoning, and a restructuring. For some CFOs, this is when they too find themselves looking for a new job.
I have left a client over this before, and I’m sure it will happen again. I understand the prsssures in growth build stage companies and consider myself an optimist and someone who helps management teams set stretch goals. We’re not A/P at IBM after all. But I remember always that my only product is integrity.