All about being the CFO of a startup
We were sitting around a small beach table, having some cold beers and watching the waves hit hard on the big boulders a few meters away. There was supposed to have been a big banging beach party that night at Bureh Beach and that is what we had gone there for, but alas, there was silence, a chill in the air and absolutely no sign of a party.
The five of us shared a mutual friend, who was there enjoying the beers with us. I had literally just met them and as we introduced each other, we obviously talked about our work in different sectors. At the mention of my current and former roles, one of the new friends sighed and exclaimed, “Well being the CFO of a startup is basically doing bookkeeping and accounting work so that is not a strong experience…” I remained quiet, with everything in me violently objecting. He could have not been more wrong.
You see, just a few minutes before my friends came to pick up, I received a call from my now ex-boyfriend. He was explaining that he needed the time out that I had recommended he take two months earlier. Too many things were going on in his life, and he could not present his full self in our relationship. I was seething, because when I mentioned it, he had convinced me that he was ready, and I regrettably believed. So at the time of this conversation, I was not ready to engage in yet another deep conversation. I knew I was vulnerable because of my state of mind, but I have been unable to maintain complete silence on the issue.
The world of start-ups is a maze, that if you have not walked, can be easily undermined to a straight path. I have worked with 3 startups in a period of 6 years, in each holding more or less the similar role and yet each role was very different. The companies I worked with had unconventional business models inherently dedicated to delivering social impact. They are businesses set up in areas or sectors where other businesses cringe at the mere thought of it. The operating environments were riddled with logistical, political, societal and economic problems that, just having a business in these areas or sectors was a success on its own.
In my role with the different companies, I did work on finance, financial reporting and reviewing the work of the accountants (yes, there are bookkeepers and accountants in startups too, it is not the CFOs job). I also worked on breaking down the business model in a way that could be accounted for in the finance books; something new as the business models and products of the companies were still developing. More of the financial work included writing proposals for fundraising, budgets, preparing the necessary documents for an equity raise and the horrendous reports to the different partners.
Beyond my finance work, however, I also worked on understanding the vision and crystallizing it into a well-defined strategy, that I then fully represented in a financial model; I focused on building the capacity of our human resources so we can have meaningful roles and maximum utilization of the capacity that we had; I built cross-subsidizing strategies that enabled the company to sell to unlikely customers profitably.
All said and done, none of the work above was the hard work. This is the work that CFOs are expected to do I guess. In startups, however, it takes a little bit of a turn, only because it is a startup. The true work laid in navigating complexities in the businesses. Here are just the top 3:
1.The founders: It is a respectable and enduring thing to set up a business from scratch. If only life would cut them some slack and make sure that founders deal only with the challenges of being an entrepreneur only. But no. Life goes on, babies cry all night, life partners decide to throw tantrums, parents are consistently disappointed with your uneventful life, and yes every now and then your business threatens to go bankrupt. Hands down, I have a lot of respect for entrepreneurs, it is a strong hussle.
That said, there are some founders who come with egos flying on kites in extremely bad weather. They complicate everything and they probably have every reason to. The company and its founder have a close relationship, like a parent and child; a relationship that you do not see in well-established companies because the founder will have probably resolved to at most, a board seat. With the “parents” of this child being constantly involved, you will find yourself having to explain, justify or whatever else there is, stuff that would otherwise be routine. Sometimes you are cut out in conversations you should be involved in because they were just not feeling you that day, and three months later, you realize there was a critical change in strategy that is not reflected in the financial models or budgets. More work for you.
I personally believe that the rate of success or the chance of success of any startup depends on the founder’s teachability and willingness to acknowledge what they know and do not know. Just this aspect is a game changer and is now a mandatory requirement for me when I am choosing who to work with next.
2. The partners: Because at the start, founders go “begging” for support from investors, and non-financial business supporters, I have found that some investors and partners come in with an arrogant “you are nothing without me” attitude. They make unreasonable demands and throw stumbling blocks in the path of the business when it is not necessary. I had one board member who asked me to deliver a certain set of key performance indicators KPIs. She said she thought my current list of KPIs was too long (hmm.. wonder why). A few months later (literally the next board meeting) she was disappointed with the list of KPIs because it was not exhaustive enough. Fortunately, I was using a system that allowed me to add the KPIs back to the list by a few clicks.
I worked with other large corporates before I decided to move into the startup scene. I have experienced some board meetings and board pressure in these organizations, but nothing prepares you for the boards of startups. From requesting monthly board meetings to sending a slew of similar/ near duplicate requests every other week to being downright disrespectful, dealing with these boards is a full-time job. I am glad that there are still some reasonable investors and partners out there.
3. Stereotypes: This may not affect everyone the same, but if you are in any way like me, you know what I am talking about. To those who do not know, I am a black girl who works magic! I was born and raised in Zimbabwe although my accent is rather lost (I have picked up little pieces of language and accents from each country I lived in). Now, being a black girl means you deal with both racism and sexism. In one role, I was the only woman and only black person in the office. Everyone was generally respectful except for that one person who will swear he is not racist or sexist but everything from his condescending tone to his unwillingness to treat you the same as others even when there is a governing policy on the issue, says otherwise.
When you are a girl you have to work at least twice as much to just prove your worth (depending on who you are working with of course).The game changes when you are a black girl, directly from Africa! Because startups are still getting their houses in order, policies are still being developed. There is very little if any protection for people who fall in certain stereotypes like mine.
One of my employers considered themselves to have done me a favor to give me a job, I mean, they had taken me out of the poverty and misery in Africa right. I owed it to them (Perceptions of life in Africa — that is a topic for another day!) I earned my right to sit at that table, and yet he wanted to make me feel privileged to be there. I know for a fact that even though my minimum rate was stipulated by the government, he was still trying everything to pay me less.
With all this being thrown in your face, it is kind of hard to stay focused on the job and get results, but then, we still do.
At the end of the day, being the CFO, or any other role in a start is not exactly a piece cake. It is definitely not any less of a role because it is in a smaller company, it is probably more of the role. You work hard, support the development to the company, deal with the complexities of startups, and still walk away with a miserable cheque. You have to have a good reason to work here, a personal incentive, otherwise the struggle of it will not be worth it.
