The importance of mindset: how the tech CFO job search is changing
The competition for experienced CFOs has never been greater. After a few years of abundance, now the scarcity of capital means that tech founders are looking for experienced, strategic CFOs who can drive capital efficient growth.
CFOs wear many hats, and scaleup tech businesses are starting to look more creatively for candidates outside their ecosystem to tap into a wider talent pool.
I'm founder and CEO of Altima, a 25-person search firm based in London. We are behind the CFO hires of some of the world’s most disruptive tech companies, including Wise, Bolt, Personio, Multiverse, Spendesk, Swile and Remote; and have over 15 years experience moving CFOs within Europe and the East Coast in the investor led technology landscape.
For nearly two decades, my team and I have helped founders find game-changing CFO’s for their business, and helped CFO candidates land career defining roles.
Despite the current market uncertainty and challenges, there is an abundance of brilliant tech businesses scaling and raising capital at healthy valuations. These are true category leaders, with great fundamentals, cap tables and sustainable business models.
For me personally, as founder of Altima, to work with some of the most exciting and inspiring founders in our ecosystem is one of the greatest rewards and privileges.
In this article, I’ll share some insights for those wishing to join the tech ecosystem as a CFO. It’s a worthwhile journey and one that can bring unexpected success.
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The tech CFO job market is wide open
CFOs are in high demand. While the market for tech CFOs has always been competitive, we are currently seeing the biggest war for finance talent in the tech sector for 20 years, and more demands on finance leads than ever before.
Two or three years ago, we saw many businesses raise a huge amount of capital in early stages. A €15-30 million Series A round would be quickly followed by, say, a Series B for €80 million. For many CFOs at the time, the focus was on allocating the rush of capital we were seeing in the tech sector, and driving growth towards fast-approaching funding rounds
Today, tech startups are typically focusing on extending runway and carving out a path to profitability. With this in mind, companies are placing greater value on a cost-oriented finance leader who is also dynamic and culture-driven, ready to propel the business forward as soon as the opportunity arises.
This presents a challenge: there aren’t many CFOs out there who have that experience and mindset, and there are even fewer of those working in tech.
The classic dichotomy, where CFOs either come from an accountancy and audit background, or the financial markets and consultancy, is no longer so relevant. Great CFOs come from both backgrounds.
What tech companies are looking for is comfort with risk, willingness to make decisions with partial information, and the ability to adapt when things don’t go to plan.
Regardless of your background, highlighting the right strengths and proving that you have the new CFO mindset is key.
The tech CFO mindset in 2023
Comfort with risk
There’s a stereotype that CFOs are typically risk-averse and work hard to steer the company away from uncertainty. But for tech companies - even during a challenging economic environment - there is often no reward without risk.
It’s not so much about being a “risk-taker.” It's more about being able to appreciate risk, and be comfortable with the fact that, in order to grow, you have to invest. Inevitably, you will get some of those investments wrong.
Top CFOs must embrace failure as part and parcel of long-term success. If we’re going to fail, fail fast. They come in and help structure decision making with data and processes. They ask questions and identify serious red flags. Founders, in turn, need to be comfortable with the idea that you can mitigate risks, but not de-risk the business altogether.
Over the past three years, we saw many companies growing at 100% per annum. Now, they’re suddenly hit with a very different valuation and the possibility of a down round.
CFOs today are tasked with making changes fast, and making financial decisions that might have serious and often unpredictable consequences. You need to be able to embrace uncertainty and risk, and still have the confidence to make the calls you need to make.
A hands-on approach
The CFO role has become more varied due to the challenges created by the market. These challenges vary according to the inner workings of each start-up’s business model. But across the board, companies can no longer hire a CFO that specialises only in strategy or fundraising. Finding operational efficiencies and reaching profitability are increasingly important priorities. This puts more emphasis on having business model-specific knowledge, with startups looking for CFOs that can drop into their often unstructured teams, shift contexts quickly, and get their hands dirty.
Although a certain level of hands-on fixing has always been needed for early-stage companies, more and more later-stage start-ups are requiring this in a CFO too. We are seeing several companies that prioritised growth over process, now needing a lot of hands-on support to structure their finance function.
A long-term vision
As well as day-to-day operations, CFOs also need a strategic long-term outlook. In spite – and because – of the economic uncertainty, boards are eager to re-gain an understanding of what the next three to five years will look like.
It’s not just about having the experience necessary to map out a realistic trajectory. It’s also about having a broader mindset: one that combines ambition with the hard work that underpins sustainable growth.
Candidates motivated by long-term progress – over hyper-growth and fast exits – will find more opportunities in the coming years, and more fulfillment in their careers. Even those CFOs who stepped in during boom times two years ago, have had to adjust their short-term expectations.
Aligning with the founders
In the tech startup ecosystem, the CFO is often the first genuinely senior external hire into an organisation. That means that a CFO has to quickly adopt the founders’ vision, but with the explicit aim of evolving the company into a more stable, established orgnisation.
Again, this makes your mindset vital. When you join a startup as their first CFO, chances are that operations won’t be optimized at all. You are likely to spend the first few months identifying issues and broken processes. Hopefully, that’s exactly what the founder/CEO expects from you.
Crucially, everyone - the CEO, the search firm, and you as a candidate - all have an obligation to set expectations to avoid surprises and misalignment down the road.
During the interview process - and certainly once you start in the role - build a co-created roadmap and vision of what success would look like in 100 days, 200 days, and beyond.
Having a shared understanding of the role and what success looks like will be key to your success.
How to prepare as a CFO candidate
Clearly, there are countless moving parts to this process, and there’s no “right way” to land your ideal job.
The most important thing is to be clear on your expectations for the role and the company. In my experience, when a role doesn’t work out, misalignment is to blame.
So as you explore your options, keep these questions in mind:
How do you want to spend the majority of your time? Setting up processes, fighting fires, dealing with investors, and so on.
What growth trajectory should the company be on? Even in the middle of a downturn, some companies have growth in mind. And arguably, there’s more opportunity for impact in the businesses that could go either way.
What degree of certainty do you need about the above?
What kind of relationship do you expect with the founder? And do you need complete autonomy, or can you handle a charismatic micromanager?
With CFOs in hot demand and a shortage of supply, you should be able to find a role that ticks the majority of these boxes. So be prepared to show how your mindset and experience are just what the business needs.
And of course, both CFOs and founders can reach out to Altima for help in your search.
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