- Establish a solid foundation and robust infrastructure in finance and operations to facilitate growth.
- As CFO, it’s important to nurture relationships with the rest of the executive team so you can clear obstacles in their path.
- Develop leadership skills at a faster rate than your startup’s growth or risk being left behind.
Why Staying Ahead Of A Startup’s Needs Can Pave The Way For Success
Working at a hyper-growth company is often thrilling, though the thrill can come with a bit of turbulence. Eileen Treanor, a veteran finance executive, first experienced this early in her career when she joined Yahoo in 2005.
Over the next five years, Yahoo grew to 17,000 employees from 7,000, and cycled through five CEOs. She describes her role on the front lines of financial reporting as managed chaos. With most of the financial data still on spreadsheets that had to be checked manually, the joke among staffers was that the company was always working on closing the books. “It was a roller coaster,” Treanor says.
But the experience taught her a lesson that’s guided her through the rest of her career: “If you don't have a good solid foundation in the operations of the finance department or finance teams as you scale, it can have long-term consequences later on.”
After three more stints in increasingly senior finance roles at high-growth companies—Virgin America, Wikia and Lever—Treanor has become something of an expert on scaling and the leadership skills needed to keep chaos at bay. Her experience led her to Inkling, which she joined as chief financial officer in November. She’s charged with helping to steer the company through its next phase of growth.
Treanor recently spoke with Silicon Valley Bank about the leadership lessons she learned and the changing role of the CFO at a company that scales quickly.
Yahoo was clearly a hyper-growth company. But when I think of Virgin America, that’s not the image that comes to mind. How did you end up there?
I really loved the company and the brand. I randomly saw this perfect position for me there as the Director of Financial Reporting. I was at Virgin America for three-and-a-half years and apart from learning a ton, it was also an insanely exhilarating experience. While I was there the company doubled in size, even though oil prices were around their historical highs, which made it even more challenging for an airline.
Were there similarities between Yahoo and Virgin America when it came to their finance departments and how they contributed or got in the way of scaling?
I don't think at either company anyone expected or fully contemplated the pace at which we would grow. It’s hard to grapple with the operational impact of that kind of explosive growth. It was challenging for the finance function and systems to keep up, so as an interim measure we had to throw people at the problem, which over time can make it expensive and inefficient.
So then you went to a real startup where you could run the show and build things from the ground up. Tell us about that experience.
I joined Wikia, which was just under 200 employees and a small finance team. By the time I left, we had over 400 employees and seven offices. The role was probably 80% operational, 20% financial reporting. I was involved in every aspect of the business, and it's where I learned how finance can really enable the rest of the leadership teams. If you can build a relationship the right way, it can be hugely impactful on the business because you have the rest of the leaders actively seeking you out for advice.
This isn’t easy to do, building scalable operational systems takes time and is in itself a process. When I joined Wikia, we were managing and recording revenue on a Google spreadsheet. Even with everyone from the CEO down invested in change, it still took us a year to fully implement a new software system. The difference it made to the business was huge, and went way beyond finance. We had so much more visibility into our business and trends. More importantly it also made people's jobs more interesting. A lot of the data entry was unnecessary and we basically were able to level up the existing operational support team.
One of the things about high growth is that whatever you are building today will become obsolete pretty quickly. How do you manage that?
You need to make decisions based on where we're going to grow in the next 12 months. This can be a bitter pill for companies to swallow because it means making investments early. You have to build a finance team with additional capacity especially when you are growing aggressively. You can't bring in a finance person tomorrow and have them jump in. They need three to six months to scale up processes and understand the business. And I think that's the biggest challenge because obviously there are tradeoffs to these investments.
As these changes happen, and as the company doubles or triples in size, how does the role of the CFO change? What do you need to do as a leader to adapt?
I think the best example is probably my time at Lever, which makes job applicant tracking software. I joined when there were under 100 employees and I was the first finance hire, the first CFO. Initially, I was trying to build a team and the infrastructure to report accurately. Then it very quickly changed into a more strategic role, where I was partnering with the CEO and thinking more about the long term vision and overall strategy for the company.
It was the most intense work experience I've ever had. The big learning for me was how powerful the CFO-CEO dynamic is. I think that it made me realize that our roles are to basically clear the path for everyone else so that they can execute.
What are some examples of the things you did?
Within months of my joining we were fundraising, so my role very quickly went from getting the financial metrics right to strategizing around fundraising. That meant orienting the team around our fundraising goals. My big learning was that the level of detail required to execute varied depending on who you were talking to in the organization. Some groups just needed a high level metric or number to execute whereas others would require a lot more detail to get on board.
I also helped manage the sales team for six months. I was jumping into the trenches, going on sales calls, flying wherever they needed me, helping with contract negotiations. I now have a lot of empathy for sales leaders, which is unusual for a CFO! It was really great to build the team and be part of that growth.
You talked about clearing the path for other execs. Talk about what that means in terms of getting to know things beyond financials, say, in product or engineering?
With SaaS, once you've built a product that’s out in the market, you need to focus on onboarding new customers and on customer success, which is basically keeping them happy. It's important that the CFO stays close to all those functions. Because if your product isn't where it needs to be, you typically have to spend more on customer success to shore that up.
The best way to grow is to build functionality in the product rather than having to shore up the lack of functionality by overserving the customer from a customer success standpoint. So in my job as CFO it’s really important that I understand the interrelationship between these functions, and how everyone is delivering on their goals.
You mentioned the importance of the CEO-CFO partnership. What does a good working partnership look like?
It’s when you become thought partners for each other. Being a CEO can be really lonely. Sometimes it feels like it's all on their shoulders. Having a strategic CFO who is a thought partner, who isn’t afraid to be the devil's advocate and offers an alternate point of view, is critical.
I think a big part of my role is being able to offer an alternative opposite viewpoint to the CEO. When I was interviewing here at Inkling, I said I want to be in a company where the CEO and I can have a very tough conversation but still walk away from it having utmost respect for each other. And I think that's a really big part of the relationship.
Describe a tough conversation?
The tough conversations are the ones where you have opposing viewpoints about a course of action or decision that needs to be made. Empathy plays a big role. You have to understand where the other person is coming from. It’s not about ego or “winning” an argument; it’s about two people who are hugely invested in the company’s success trying to make a decision together.
How do you think you’ll apply the lessons you learned about scaling at Inkling?
Inkling is a really great Company and am delighted to be here. Our product is highly within the learning and development software space and this is evident by the caliber of our customer base. We work with multinational Fortune 500 companies, and we are going through a really exciting phase of growth. A big part of my role here is clearing the path so that we can execute on that growth. In terms of the finance function, a lot of the basics are in place. We just need to build on that foundation. And again, getting ready for scale. That's what I'm doing here.
If your younger self was starting her career again, what would you tell her?It’s not enough to grow with the company. You actually have to grow faster than the company. Otherwise you're going to be left behind. If you're not thinking at least a year ahead, nobody else is.
Experienced CFO and leader of high-growth startups
CFO at Inkling
CFO and VP of finance who enabled scaling at Lever and Wikia
Senior financial reporting roles at Yahoo and Virgin America
Berkeley MBA with auditing stints at PwC and Ernst & Young