Jamie Irwin, Partner in Finatal’s CFO Practice, speaks to Jamie Arnold, Managing Director – Portfolio Talent at Mayfair Equity Partners, and Pete Rowse, experienced former CFO and chairman, about making the step up to CFO in a PE-backed business.
Following a breakfast roundtable with 20 step-up CFO candidates at The Soho Hotel in London, Jamie Irwin sat down with Jamie Arnold and Pete Rowse to explore the transition into a first CFO role.
The conversations brought together the perspective of an experienced CFO and chairman with that of an investor assessing future finance leaders. Both emphasised commercial understanding, broader experience and the ability to build confidence with the people around you. For Jamie Arnold, a key consideration when assessing a first-time CFO is reducing the number of “firsts” they will face in the role.
From taking ownership of the forecast to demonstrating your contribution in an interview, their advice offers practical steps for finance leaders preparing for greater responsibility.
Pete, what changes when a finance leader steps into the CFO seat?
Pete Rowse: As a CFO, you need an overview of the business and a much more commercial outlook. There is greater visibility, exposure and responsibility, and you need to be ready for that.
You need to understand the business and take greater ownership of sales activity and forecasting. That means knowing what is happening across the company and understanding the drivers behind its performance.
How can a first-time CFO build credibility with investors?
Pete Rowse: Building investors’ confidence is critical. You need their trust to do the job effectively, and managing expectations is a large part of that.
Own the forecast and understand revenue operations and the pipeline. Make sure there is room to manoeuvre in your assumptions. You also need to manage expectations around the delivery of information. Private equity investors will have questions and requests for data, so agree reasonable expectations and deliver information on time.
Which skills should aspiring CFOs develop now?
Pete Rowse: Commercial understanding is central, including knowledge of the sales pipeline and revenue operations. The personal skills become increasingly important too.
You need to negotiate internally and externally, feel comfortable making decisions and work effectively with people. In a growing business, the CFO often becomes a sounding board for the wider team. Advising and supporting colleagues is an important part of the job.
How did you know you were ready to make the move?
Pete Rowse: I felt that I understood what was happening across the business, including sales and operations, and could see where things could be done differently or better.
I also felt confident that I could communicate those ideas and make the case for change. Many finance directors and controllers will recognise that position. Having the confidence to explain your thinking and influence what happens next is important.
What should a new CFO prioritise in the first 100 days?
Pete Rowse: Have a plan and agree it with the CEO and investor. They will already have ideas about what they want to achieve, so make sure the commitments are deliverable. Tangible progress in those first 100 days helps establish credibility and build trust.
Reporting is another area where you can make an impact. There is usually an opportunity to improve it. Give the business clear summary information on its critical success factors, KPIs and trends. Charts and graphs can help people remember the information and focus on what matters most.
Jamie, how do you assess candidates stepping into their first CFO role?
Jamie Arnold: The pool of CFOs with private equity and exit experience is becoming smaller, which means investors need to think carefully and creatively about finding the right talent for their businesses.
With step-up candidates, we are conscious of reducing the number of “firsts”. If someone has not held full CFO accountability before, it helps if they understand the business model and the situation they are entering.
We also look for breadth across the finance function. That includes exposure to FP&A, tax and treasury, alongside their core experience.
Where can aspiring CFOs broaden their experience?
Jamie Arnold: Ask for more opportunities to speak with shareholders and gain experience in different parts of the finance function. It is also important to spend time with commercial leaders, including sales and marketing.
Understand what the numbers mean and how they can support decisions. That experience helps you become a partner to commercial leaders and the CEO, bringing a value creation mindset to the role and helping deliver the business’s plan.
How do you test commercial judgement in an interview?
Jamie Arnold: We look for examples of candidates using finance data to understand the underlying drivers of growth and improve performance.
For example, if a conversion metric is low, how have they used that information to help improve it? We want to understand how their contribution helped drive revenue, improve profitability or inform decisions about a new market or product feature.
What helps candidates make a successful transition?
Jamie Arnold: Alongside commerciality, a proactive approach to value creation is important. A CFO needs to think ahead, stress-test assumptions and help the leadership team understand potential challenges.
If a contract delivers less than expected, what does that mean for the business and its profitability? Exploring those questions helps the team anticipate issues and understand what the future might hold.
What should candidates do over the next 12 to 18 months?
Jamie Arnold: Keep pushing for more exposure. Spend more time with the private equity firm and seek experiences beyond your core remit so that you can demonstrate broader knowledge of the finance function.
When you interview, bring specific examples and metrics. Be clear about what you personally did and the impact you had. Identify people in your previous business who can validate that contribution and act as referees.
This interview has been edited for length and clarity.
Explore Finatal’s CFO recruitment practice for more information on finance leadership in PE-backed businesses.