Vareto names Nathan Harkenrider as Chief Technology Officer
June 14, 2022
David Wieseneck is the VP of Finance at Demostack, a demo experience platform. David was previously VP of Finance at letgo (acquired by OfferUp), where he built the Finance team from the ground up, and OLX, where he was the CFO’s #2 and helped grow the company from 100 to 600 employees.
There was a tweet by a CEO a few months ago that got a few laughs in the tech world.
Not a flattering stereotype of Finance right? But how do we change this perception of the finance team as a reactive cost-cutter to a strategic business partner? After working in finance for over 10+ years and building the finance org at letgo, Demostack, and more, here are three guiding principles I’ve found to work best:
When we say “no” outright to business asks, people decide to sneak around Finance instead. They figure it’s easier to ask for forgiveness rather than permission. They stop inviting Finance into meetings because they think Finance will just shut things down. So saying “no” to business stakeholders becomes detrimental to the company. I’d rather be in that meeting than not and be surprised later when something gets launched without the proper financial oversight.
What is far more effective is for Finance to say “yes, but…” and then highlight the risks for them. Rather than saying no, we let the business stakeholder take ownership of the decision. This creates mutual trust — they’re a smart business person who is perfectly capable of making the decision. Finance can help them make an informed decision by highlighting the framework to evaluate it. We can point out the downside risks and the upside opportunities, and where there are tradeoffs from a budget perspective. By establishing this trust and transparency early on, Finance can be a strategic advisor that the business stakeholder won’t hesitate to come to.
Financial models should never exist in a vacuum. It doesn’t make sense to take last year’s model and add 8% growth month-over-month because it will never work in reality. A business is interconnected. When building out a financial model, we need to understand how this piece of the P&L affects that part of the balance sheet, or how sales will affect customer success headcount. It’s the only way to build a forecast that makes sense.
To build the right financial model, Finance needs to understand the product and the business — and ultimately, the people required to fund those investments. This means knowing everyone’s role and what they’re working on in order to understand which strategic initiative is worth the investment. This means taking the time to learn about each function — those interactions build goodwill ahead of time.
The best finance teams aren’t just strategic advisors to the C-Suite, but also to the Head of Customer Success, Head of Marketing, and more. Having that curiosity from the start means that Finance isn’t playing catchup when called in to become a sounding board — otherwise, it becomes harder to make the right strategic decision.
Many finance teams get caught up trying to ensure everyone sticks to the rules. In reality, no one will read a multi-page policy document. If Finance sets strict, comprehensive rules, people will inevitably find workarounds.
Creating gatekeepers and roadblocks only leads to bureaucracy, distrust, and the perception of the “Office of the CF-No.” People generally want to do right, but they’re busy, so they look for the easiest path, which sometimes can be a workaround that hurts the business in the long run.
How can Finance guide users into making a good choice? Don’t use a carrot or a stick. Instead, Finance should illuminate that path from A to B by making that path as easy as possible. This way, the fastest, easiest path is the right choice.
What does this mean in execution? This includes:
As finance leaders, we’re constantly thinking about the levers for business growth. Tools and technology can help, but these soft skills can have an outsized impact. By changing the relationship dynamic with business partners, Finance can proactively help the business grow.
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