What Type of CFO
Excels within a
PE-Owned Company?
By Drew Railton
C
ompanies that turn to private
equity (PE) firms for an influx
of cash run the risk of being
unprepared for, or unaware of, the
changes these firms will want
companies to implement in exchange
for the financial capital they are
providing.
To make sure a company’s investments
are sound, many PE firms often ask
organizations to alter the way they
do business. For instance, PE firms
tend to require companies to operate
at a faster pace than that to which
they might previously have been
accustomed.
Consider the fact that while most
public companies report on a quarterly
basis – and ultimately present their
progress to the board, shareholders,
and others with a stake in their success
four times a year – PE firms meet
with management more often than
once per quarter, and also require
detailed financial information from
management on a monthly basis.
Beginning with the CFO
The chief financial officer (CFO) tends
to be a PE firm’s first point of contact in
terms of gauging the need for change,
and Les Gombik, managing partner
of Caldwell Partners’ Calgary office,
explains why. “Although the CEO is
the primary partner for the PE firm, the
CFO is a key conduit for determining
whether a company’s investment is
sound and whether the company is
growing – top line and/or bottom line
– at the pace the PE firm needs it to
grow,” he says.
Gombik also stresses that PE firms tend
to have a more short-ter H