Anecdotes and customer conversations no longer tell the entirety of your business story. You need help!
It’s finally time to hire your first finance person. (Don’t know when that is? Start here.)
Your first finance hire is not an accountant. Everything back-office should be outsourced.
They’re also not the gray-haired, seen-it-all CFO. That’s overkill.
Your first finance hire is solving the multivariate equation of your business. They’re organizing your business around frameworks, and parsing apart every step with analysis.
Therefore, your first finance hire is an analyst at heart.
For your first hire, you need someone who is willing to get their hands dirty with data. They’re willing to get dangerous and learn how to get into a SQL data warehouse. They might even be willing to learn some scripting languages (i.e. python) to automate their analysis and not be a drain on engineering.
And yet you also don’t want too junior of an analyst. You want someone who can develop their own opinions and approach every analysis with an extreme level of ownership - as if they’re the CEO.
From my experience, here’s a rough outline of where to find folks that make for great first finance hires.
- Look for someone who started their career in banking, management consulting, or large company finance roles. This is a foundation for folks who can build a model, communicate effectively, learn quickly, work hard, and understand a business.
- Next, look for folks who transitioned into mid-size startup finance teams. They’re seeing the awkward, teenage phase of company building - when the systems are still being developed, the business is still rapidly experimenting, and they’ve gotten a feel for the types of frameworks important for early stage companies. Most importantly, they’re able to look around the corner at least one step.
- Practically, make a list of companies that you admire and have comparable business models (e.g. SaaS, eCommerce, Marketplace). As a rough rule of thumb, think of folks working at companies in the $40-$100M ARR/Revenue range. Then look for folks with titles like Senior Finance Analyst, Finance Manager, Senior Finance Manager. Those are prime grounds from which to pluck your first finance hire. Many of them are eager to build from scratch!
Finally, as you start to build your pipeline, remember that interviewing analysts successfully is a direct function of how analytical you are during that interview. In fact, here's the most important question I use to screen for great analysts.
After you’ve made the hire, here are a few lessons I’ve learned to help your finance scale as a leader.Image credit: https://www.oldbookillustrations.com/illustrations/walk-gemmi-pass/