CFO

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Informing decision-making

Applied Analysis

In the scale-up phase, retrospective financial reporting, however good, is not enough. When growth is fast you need high quality, relevant and timely information available to make fast decisions.

You therefore need applied analysis not just financial reporting. Of course, you need the basics of budgeting, board pack, departmental KPIs and proactive cash management but applied analysis goes further linking insight on ways to drive better outcomes to finance departmental reporting. Finance must evolve to become the value add centre of resource allocation decision making information and its ambassadors (CFO or COO) must participate in decision making not in policing outcomes.

Key expert

Steven Dunne

“Generating high quality, relevant and timely information for decision-making is crucial through the Scale-Up phase.”

Steven Dunne, Senior PartnerView Profile

Establishing the mission

Strategy

Frogs’ definition of strategy: “A competitive game-plan to achieve an important goal” Particularly during the scale-up phase, where a degree of product market fit has already been established, strategy is not about selling a vague market opportunity but rather combining a clear view of addressable market with a robust plan of action as to how this can be exploited. More importantly, identifying the unique resources and attributes your company has (and will need) to thrive in that environment.

Key expert

David Williams

“As you scale a business it grows beyond senior management’s line of sight, so strategic intent is crucial from a communications perspective.”

David Williams, Operating PartnerView Profile

Achieving organisational clarity

Organisation

Good organisation starts from the top and changes in the board are likely to be the most obvious initial differences when growth capital is taken on. Whilst we add value through our Frog representative on the board, we also encourage a wider review of what skill sets are required (for a new chairman for example) at that level and what the processes should be. The board should be a huge asset to the business and where this isn’t the case, you either have the wrong people on it or you aren’t getting the best value out of them. At the executive level, organisational clarity from the top drives business discipline and accountability through all levels, ensuring a consistent approach of rigorous follow-up on previously set targets or projects. This is not about blame but learning and improving every year.

Key expert

Steven Dunne

“Corporate organisation structure can drive discipline and accountability at all levels in a business.”

Steven Dunne, Senior PartnerView Profile

Knowing your options

Funding

A successful scale-up will have lots of funding options. A company with few funding options is not likely to succeed. Scale-up company boards must have experience of and network into funding alternatives (internal and external equity rounds, venture debt, working capital facilities, its own customers and ultimately, profits), and should understand the company specific pros and cons of each. One of the most common mistakes is pitching your story too early to investors who say they are intrigued but don’t shift to being convinced. Thoroughly test the core thesis you are asking your audience to pitch to their investment committee. And thoroughly research their key investment criteria, as a debt provider, corporate investor, scale-up investor will all have very different measures.

Key expert

Steven Dunne

“Funding requires a continual questioning of whether the current approach is fit for purpose for the journey ahead.”

Steven Dunne, Senior PartnerView Profile

Building resilient businesses

Sustainability

A core part of the Frog philosophy is helping management to build businesses that can become self-sustaining longer term. Ownership may change but the aim is to create a thriving organisation that lasts the test of time as a business entity not just an innovative concept. This builds on all the other elements of the Scale-Up Methodology, especially clarity of annual strategic plans, providing an action plan for executing new growth initiatives and delivering increased market penetration in a well-researched way. The most effective scale-up CEOs drive aggressive growth, not at all costs, but by judging their ability to attract the right level of resource to fuel the plan, thereby keeping the destiny of the business in the hands of the executive team.

Key expert

Jens Düing

“Making difficult decisions to address the changing needs of a business is critical to its survival and success.”

Jens Düing, Senior PartnerView Profile

My Scale-Up

Our methodology. Your Scale-Up

Find thought leadership, videos and toolkits dedicated to your role. Whatever your focus area in the leadership team of a software scale-up we have advice and expertise that can support you as your company grows. Search by your leadership role or focus on the sections of our Scale-Up Methodology.

Scale-up methodology

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