Why You Should Recruit CFOs with IPO Experience
Taking your company to its initial public offering (IPO) can pose challenges to even the most experienced of CFOs, including those who have gone through the process before. CEOs look to their CFO for direction and strategy, relying on them to oversee stakeholder engagement and lay the foundation for a positive investor story.
A CFO with IPO experience will help to steady the ship and prepare the company for IPO, including by overhauling its existing systems and structures. Companies considering a potential IPO should take a step back and recruit a CFO with previous IPO experience to oversee the project, whether on a full-time or part-time basis.
A successful IPO requires a CFO to steer the ship and transform a business to maximise its value creation. Most CFOs will focus on restructuring the company’s finances and streamlining its decision-making process by investing in digital and enterprise resource planning tools. CFOs with IPO experience are typically digital natives who utilise real-time data and forecasting to implement KPIs to ensure performance management.
Taking a company public requires an enhancement of its existing processing and infrastructure to meet additional demands for financial transparency, as well as ensuring a seamless transition.
Most companies are motivated to go public to access additional capital, boost their company image, and provide an exit strategy for their current investors and existing management team. Recruiting a CFO with IPO experience enables the CEO to delegate the planning of these factors to another C-suite executive.
Taking a company to IPO is not transactional. Increased regulatory requirements and governance rules pose potential headaches for any CFO. A strong CEO-CFO partnership is crucial for navigating the company to a successful IPO.
CFOs face challenges on every front, from greater regulatory requirements to auditing standards and growing calls for greater governance. A CEO and CFO must act in unison to ensure CFO success.
FD Capital is the UK’s leading financial recruitment agency, connecting companies with CFOs with a proven track record of delivering on IPO.
At FD Capital, we recruit and headhunt IPO CFOs throughout the UK. Our tailored approach to recruitment means we work with clients to identify the skills and experience they need from their candidate to deliver a successful IPO. They’re seeing a sharp increase in companies choosing to recruit a CFO to oversee their IPO and transition planning.
Do You Need a CFO to Prepare for IPO?
The IPO market has rebounded after the drought bought on by the economic impact of the pandemic, including within the tech industry. Expanding companies are once again turning to potential IPOs as a way of gaining exposure and capital liquidity.
Taking a company to a successful IPO is not like conducting an internal audit, most CFOs consider taking a company public to be a two-year process. This timeframe provides the CFO with time to restructure the company, plan for the transition, develop investor relations, and prepare for greater regulatory scrutiny.
Most CEOs won’t have the experience necessary to take a company public on their own. Recruiting a CFO with IPO experience will bring a new set of eyes to the company’s finances with a C-suite executive who isn’t afraid to challenge the status quo. Having a CFO on board boosts a company’s credibility with investors and financial institutions.
When Should a CFO Start Working on an IPO?
Going for an IPO requires a company to overhaul its existing systems, operations, and financial reporting. Auditing is crucial for providing the CFO with an accurate picture of the company’s current financial position and valuation.
Most CFOs preparing for an IPO will want to expand their finance department to ensure it has the capabilities in place to deliver during the pre-IPO period and throughout the transition period as a public company.
CFOs who have previously delivered a successful IPO point to the timeline as being multiple years to provide a window to prepare the company infrastructure and its systems for the practicalities of going public. Most CFOs will take at least two years to develop transparency, build their team and ensure accurate forecasting and reporting.
Does a CFO Need to Have Prior IPO Experience?
Companies shouldn’t automatically discount candidates who do not have prior IPO experience as a CFO. More candidates from non-traditional backgrounds are breaking into the role every year, bringing a fresh perspective and new skill sets.
A CFO in this scenario will build their team with individuals who have prior experience working on IPOs. CEOs who have their own experience navigating IPOs may not put as much weight on needing this experience. It’s worth considering what other experience, skills, and contacts they can bring to the table.
Looking Beyond IPO to Life as a Public Company
Companies shouldn’t just consider the IPO process when recruiting their CFO. Your CFO will spearhead the organisation’s transition into a public company, including establishing the systems and infrastructure necessary to deliver enhanced reporting and transparency. An IPO should not be seen as the end goal, but rather the start of a new chapter.
The final months before the IPO will see the CFO focusing on the organisation’s first quarter as a public company on ensuring the first quarter of your company’s time as a public company goes smoothly to deliver a positive investor story. Acclimating the company to the reality of being a public organisation is the second step of a successful IPO.
Recruiting a CFO with IPO Experience
While most companies will put a premium on CFO candidates with prior IPO experience, you’ll want a candidate who can deliver throughout the company’s transition into public life. CFOs without prior IPO experience shouldn’t be automatically discounted, especially if the company has other C-suite professionals with IPO knowledge.
FD Capital is the leading London-based financial recruitment agency with a portfolio of CFO candidates with a proven track record of delivering on IPOs. Their candidates are available to work in-house and on a remote basis.
Start recruiting your IPO CFO today by contacting FD Capital at email@example.com or 020 3287 9501.
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