What is a Private Equity CFO?


The ideal private equity CFO is both strategic and operational, serving as a thought partner across various functional and divisional aspects of the business while implementing the systems and processes to help the company reach an exit.  A strategic CFO is growth-oriented and looks at the business “through the windshield,” rather than the rearview mirror.

 

Enterprise Experience

More often than not, private equity firms fill portfolio company CFO roles with executives who have enterprise level CFO experience.  They will have had full ownership of finance across all functions (audit, tax, treasury, FP&A) and will have interfaced with a board of directors on strategic matters.

Conversely, a divisional CFO may have relied on a shared-services infrastructure to manage other finance areas.  Additionally, a divisional CFO may have managed the business to only a certain level of profitability, focusing on, say, gross profit rather than operating income or cash flow.

 

That said, there are situation in which a divisional CFO can offer just as compelling a skill set as an enterprise CFO.  For instance, divisional CFOs from certain large corporations operate their businesses with a level of accountability similar to that of an independent company.

 

More and more private equity firms are moving off Quickbooks for better reporting and audit trials.  Whom better than Microsoft to enable technology, especially satisfying current audits.

 

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