Voice of the CFO: Trying Times Put Finances Front and Center

Not so long ago, investors would tell companies to go full-bore in pursuit of customers and growth. That was especially true if the companies were tech disruptors — investors would tell them to take risks and hire fast.

Over the last six months, all that has changed. Investors are now asking not only what returns companies are going to give, but also how soon they’ll start reaping them.

“I think that really makes the job of the CFO sort of front and center in partnering with product teams, the CEO and the vision of where a particular company is going to go,” Adriel Lares, CFO at Stash, told PYMNTS. “Having done this a number of times, I think this is the time for a CFO to really do our part with respect to where that asset allocation does go through.”

Investment Rigor

Lares joined Stash a year ago, bringing experience as a CFO who has taken two companies through initial public offerings. Stash is a subscription platform designed to simplify effective investing for middle-class Americans. Its plans offer access to a suite of products including investing, banking, education and advice.

Interviewed for the PYMNTS series “A Day in the Life of a Digital-First CFO,” Lares said a lot of the mantras and ideals Stash shares with its customers — such as “you’re not trading, you’re investing” — play very much into what a CFO does daily.

For example, CFOs think about the investments they would apply to product or to engineering, to marketing or to acquisition, or to infrastructure — deciding to build it in-house or to partner outside.

“All those things, we go through the same rigor of, ‘How will this return back to Stash and ultimately back to our customer? Is it something you can count on for the long run as opposed to something a little bit more short run?’” Lares said.

Taking that sort of view is especially important now because rising inflation and interest rates mean there’s no longer the option of financing them at a very low rate.

“It puts a bit of pressure, but it’s good pressure, because it really does force you to understand what it is that your customer needs and wants, and then how can we — in this case, this entity Stash — best provide it,” Lares said.

In the case of a subscription-oriented business, the challenge to provide value to customers is never-ending. At Stash, they receive constant feedback in terms of absolute churn and engagement.

Enabling ‘Knowledge by Osmosis’

Like CFOs at many companies, Lares is also dealing with the question of a remote workforce. Stash is taking the hybrid approach. Lares said that on the one hand, remote work gives companies access to talent across the U.S. and even the world, but on the other hand the employees miss the watercooler conversations, chance encounters and “knowledge by osmosis” that happens in an office.

In a hybrid work environment, the No. 1 priority for companies is to make sure that employees are communicating often enough and clearly enough so that all parties understand what’s happening, Lares said.

“Documentation before and after the meeting so that we can be super clear about what was decided is a key thing that’s absolutely required,” Lares said.

In addition, Stash has get-togethers at a New York office. Lares said that at those meetings, he aims to meet not only with his team but also with other teams in order to get the sort of knowledge that people normally get in those chance encounters that happen in an office.

“Because of that, you get a better sense of how someone else’s department may impact your area,” Lares said. “In my case, I think about forecasting, I think about risk, and to me the greater those chance encounters, the more informed I am, so that when I make decisions, I can make them with the most information I can.”

Keeping Apprised of What’s Happening

Another issue CFOs must consider is cryptocurrency. At Stash, it’s another asset class that has its own risk profile. The company aims to make sure it has people to educate its customers about them, as well as people to adhere to compliance and regulatory requirements.

“Most importantly, they have to be keeping the pulse on what’s happening in the market,” Lares said. “I think of it similar to, let’s say I wasn’t in Stash business at all, I’d have to be keeping up with accounting regulations — it’s just part of our job to keep apprised of what’s happening.”

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