The CFO Career Path (#194)
/In this podcast episode, we discuss the career path for a chief financial officer. Key points made are noted below.
Key Requirements of the Job
Being a CFO involves managing accounting, treasury, risk management, strategic planning, and investor relations, but does not require an in-depth knowledge of accounting.
Being a CFO involves a lot of face time, dealing with other managers, direct reports, bankers, investors, and the company president. It also requires long hours, so you may not want this position.
Probability of Attaining the CFO Position
Very few people make it to the CFO position, and even fewer like the job once they’ve made it there. Consequently, you might want to stop in a lower-level position that feels more comfortable.
Educational and Experience Requirements
When in school, arrange for a minor in finance, or a double major in accounting and finance.
After college, one option is to switch out of accounting and go into investment banking. Doing so increases your fund raising experience, which is a major qualification for the CFO job.
Another option is to go into auditing, pile up relevant experience, and jump from there into the CFO job. In particular, do audits for public companies, to learn about public company filings - which is very useful for a CFO. Also, try to avoid niche areas, like nonprofit clients or pension accounting, since they do not help your qualifications for the CFO job.
The other remaining option is to work your way up from within the company, which means starting in either accounting or finance. This is a bit easier from the treasury side, since the main qualification for a CFO is raising money. Consider volunteering for treasury jobs if you are working in the accounting department. Another option is to get a master’s degree in finance at night, while working during the day.
Do not transfer into the investor relations department, since it is too specialized. The only viable option is a short-term assignment into the department to gain experience, and then rotate back out.
Work for a smaller company, and especially a startup. They have very few accounting and finance people on staff, so there is less competition for the CFO job. Also, you can volunteer for all kinds of work to gain experience, like insurance, and loan packages, and budgeting.