“How did they do that? How did they get there?” Companies succeed because of the people who build them - operating leaders who grow businesses to new heights and make decisions every day that can impact entire industries. Each month, our Operator Spotlight gives you the inside track from one of our incredible Operator LPs (Limited Partners) who are changing the game – building and scaling some of the world’s most successful companies. Read on for lessons learned and mistakes made, perspectives from the top, practical advice, and ideas on what’s next.
This month, we spoke with Christina Liu, Chief Accounting Officer at Confluent and Board Advisor of Tripalink. Christina brings 20+ years of finance leadership experience in building and scaling high growth companies. Christina has taken two technology companies public, Zendesk (NYSE: ZEN, in 2014) and Confluent (NASD: CFLT, in 2021). She scaled the accounting and compliance functions of Zendesk from $70M ARR to over $1B and is currently serving as the SVP, Chief Accounting Officer of Confluent where she oversees the global accounting function, including global controllership, financial operations, systems, controls, accounting policies, and financial reporting, as well as tax and procurement. Christina’s areas of expertise include accounting, tax, treasury, regulatory compliance, internal controls, IPO readiness, M&A, international expansions, business risk assessments and business model transformation.
Tell us a bit about the Chief Accounting Officer role and how it functions within the C-Suite. How has the role changed over the last decade?
The Chief Accounting Officer (CAO) role emerged in the last decade due to the growing complexities required to run a successful business. As companies face an ever-changing landscape, the finance function has become a key player in providing valuable insights and driving smart decisions. The CAO, as a dedicated executive focused on corporate governance from the finance lens, ensures robust financial integrity, compliance and operations, and empowers organizations to thrive in a dynamic landscape.
What are some of the most important dynamics between the Chief Accounting Officer and Chief Financial Officer?
Alignment is key. There are many stakeholders to the finance function, both internally and externally. The CAO and CFO must work in sync, sharing a common understanding of the company's aspirations and strategies, and the related financial implications. Trust and transparency are also crucial elements in order to have open and candid conversations about opportunities and challenges. This fosters transparency throughout the organization, ensuring the highest standards of integrity and alignment.
Have you adapted any practices in response to the current macro environment, and what are your predictions for what’s to come? Any thoughts on the IPO market?
In the current macro environment, the data-driven insights finance team can provide becomes critical to drive real-time decision making or pivot when needed. It is not only important to review high level dashboard but also important to be able to drill into certain metrics by cohorts in order to have a granular understanding to take targeted actions and drive results. Additionally, with the tightening of the corporate budget, we see more finance approvers being added to the sales process. Our ability to articulate a clear and compelling return on investment (ROI) story within our sales process becomes paramount.
What are some key strategies that early-stage founders and companies can adopt to make sure they’re setting themselves up for a potential IPO?
In today's funding landscape, where access to capital is more challenging and time-consuming, you want to be flexible in your growth plans and cash burn expectations. It's important to evaluate alternative funding strategies and consider cost-effective approaches, such as strategic partnerships, to achieve business goals. Many successful companies emerged during previous downturns, becoming catalysts for the next wave of technology and business innovations. The current environment presents an opportunity to recruit top talent, as some more established companies may no longer offer extravagant compensation packages.
An IPO marks the start of a company’s public journey, where it enters the spotlight and faces increased scrutiny from external stakeholders including investors and regulatories. You want to have a good foundation of discipline and predictability in order to achieve the business goals you set out to achieve each year, and operating infrastructure to deliver timely and accurate results.
You recently shared some insights with our founders and community at our Spring Gathering on the topic of “Justifying Product ROI and Navigating Procurement” in this environment - what were some of the key takeaways?
- Do homework on your prospects, i.e. what problems they need to solve and your value prop. Don't send generic spam emails that start with "Hi, I also went to Duke..."
- Know your champions well; level of authority, influence, budget cycle, etc.
- Know who the decision makers are in the sales process, engage them early.
- Get your stories in first, equip your champions with financial modeling to justify ROI and ask your champions to pass that onto their finance team.
- Be able to backup your ROI story, ideally with real customer use cases. Having a range helps to make your story more credible.
- Navigate the procurement cycle:
- Everything is negotiable even when you are initially told "no".
- The procurement teams are measured by (1) cycle time to sign a contract and (2) savings they can generate from the offering price,
- Be mindful who the approvers are during the cycle; legal, infosec, finance, etc.
What’s your secret super power?
I am a good listener and observer, it always comes naturally to me what others have on their mind, allowing me to build meaningful relationships. It took me many years to realize not everyone is like that, and I need to clearly state my intention, what I want to achieve and the help I need.
What’s a piece of advice you would give to yourself 10 years ago, if you had the opportunity?
I would tell my younger self to embrace that feeling of uncomfortableness, that is what learning and growing feels like.
