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Summary of Episode 4 - The Un-accidental CFO with Venkatesh Tarakkad.
Our special guest for the show today is Venkatesh Tarakkad, the CFO of DealShare.
With qualifications like Chartered Accountancy, ICWAI, and CISA, Venkatesh is a seasoned CFO with experience of over 25 years in building and scaling businesses, bringing efficiencies, managing funding rounds and acquisitions, as well as taking companies public.
Venkatesh has deep sector expertise in Retail, FMCG, and eCommerce areas, having led Finance functions at Ecom Express, TCNS Clothing, Metro Cash & Carry, and Lots Wholesale, as well as having prior associations with Ernst & Young and Coca-Cola. He joined DealShare in March of 2022 to make it the Retailer of Choice for India's Mass Consumers.
In this episode, we unpack Venkatesh's deliberately crafted professional journey from India to Europe and back and explore his times at various companies – a mix of multinationals and start-ups. Further, we deep dive into how he thinks about the evolving role of CFOs, the impact of technology, understand the CEO <> CFO relationship dynamics, and get his advice on the first 100 days plan for CFOs joining a new company.
"The whole process has been about getting deep, putting in a lot of hard work. I have seen quite a lot of brilliant colleagues, who are significantly more productive than me. But for me, I realized I need to put in quite a lot of extra efforts... going out of the way to learn new things, so I think those are the things which help me on my journey to become a CFO."
"If I needed to move from a career growth perspective, I need to be in an organization which will allow me to do that, and the earlier I joined may be, the better."
"Then, I revised the projection because you can keep stiff targets for your team, but you can't do your cash flow projections on hope. Cash Flow projection has to be always realistic."
"Our job is to make sure that you have developed a system that gives the right information for business to take calls."
"It is the job of the CFO, even at an early stage, to communicate the importance of hygiene."
"I have certain priorities in life. It is very clear for me... Health, then Family, then third is I have a significant interest in sports, trekking, and motorcycle, and then comes everything else."
"I need to have people who can build processes and work in uncertain situations... I am more interested in seeing whether the person has the mindset to make the change."
In this insightful conversation, Venkatesh underscores the need for finance professionals to hone their skills in at least one sub-function of finance - be it Financial Planning and Analysis (FP&A) or Controllership. Additionally, he underscores the merit of gaining exposure to decision-makers, such as general managers, chief operating officers, and CEOs. His emphasis lies in the rich, invaluable experience one can acquire by participating in decision-making meetings, even as a novice in the field.
Venkatesh advocates the importance of risk-taking and audacious decision-making, sharing personal anecdotes from his time at Metro Cash & Carry (Metro). He delves into the intricate ways business problems can be solved and how he and his team leveraged automation to create effective dashboards during a challenging period at Metro.
Highlighting the significance of scale, materiality, and processes, Venkatesh walks us through the complexities of group-level reporting, where significant amounts can get obscured in the consolidation. He sheds light on the need for intuition, along with mathematical analysis, to discern trends effectively.
Looking at the evolution of the role of CFOs over the past two decades, Venkatesh observes the transformation from a focus on finance controllership and taxation to a more extensive role encompassing business partnering, strategic planning, risk management, and investor relations. As per his viewpoint, modern CFOs are expected to be more technologically savvy and product oriented. He stresses the crucial role of CFOs in constructing robust, sustainable businesses and functioning as “Conscious Keepers.” Furthermore, he believes CFOs should be an essential and reliable sounding board for CEOs or founders.
Speaking on the tech front, Venkatesh elucidates how CFOs need to integrate technology beyond traditional finance and accounting functions. He explains how the CFO's role has embraced technology to optimize business aspects from inventory management to supplier performance. Additionally, he reflects on how the COVID-19 pandemic has necessitated digital transformation, with remote work emerging as the norm. As a result, CFOs need to ensure that the right technology is in place to support remote / hybrid work and keep the business running smoothly.
A crucial theme Venkatesh touches upon is the dynamics between CEOs or founders and CFOs. While the relationship between top leadership members is vital, the CFO's role is slightly different as they have an additional responsibility to the shareholders, particularly in cases where the organization is growing and becoming publicly traded. He believes the CEO <> CFO relationship should foster a healthy exchange of ideas without prejudice. This requires establishing trust early on and sticking to one’s views with maintaining a firm stance on compliance, governance, and related matters.
As a piece of final advice, Venkatesh underscores the first 100 days for a new CFO as pivotal in setting the tone and establishing a solid foundation. He encourages meeting diverse stakeholders, understanding the business from different perspectives, and building a strong team to help achieve organizational goals. It’s important to be visible and accessible to your team and understand their strengths and weaknesses. Given the advantage of a fresh perspective, he advocates being open to expressing different views and challenging the status quo to drive change.
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