A slow 2023 deal market has led to a high turnover of CFOs. We have seen a number of CFOs with their equity returns potentially “under water”, resulting in being much more open to leaving before the cycle is complete. Coupled with investors focusing on optimising their portfolio companies, this has created an active market and busy year for Portfolio CFO moves.

Throughout the year we have seen a number of key talent trends emerging. As the year comes to a close, Tom Guy, Bronzegate Partner shares three trends we will continue to see in 2024.  

Skills vs sector
In an active market with a tight talent pool, private equity firms have been forced to move away from looking at candidates from their specific sector. We have been placing a number of finance leaders in roles within new sectors, with the successful candidate being appointed due to their existing skills set, business model experience and their exposure to private equity rather direct sector experience. For investors looking for a CFO in 2024, we would encourage them to be open minded, regarding sector, as an experienced private equity CFO can adapt to a new environment.

Carve-out skills
This year we have seen an increase in the number of carve-outs our clients are undertaking. Whilst each business is unique in its offering and situation, I have noticed clear commonalities in what investors look for from a carve-out CFO:

  • Finance Transformation experience – A successful CFO will need to lead company-wide transformation often relating to people, process and reporting.
  • Finance Systems Improvement – There is often a need to implement a new finance system,  improve finance systems or end user utilisation.
  • Banking Relationships and Debt – Moving away from the reliance on a “group finance” structure, a CFO must quickly establish and manage effective banking relationships and manage debt.
  • Relationship Builder – The CFO can act as the conduit for this positive change.They are relied upon to build relationships across an organisation helping to define and communicate a new strategy and ensuring “buy in” from management/operational teams.

Buy and build experience 
Due to a limited number of platform deals occurring this year, we have seen PE firms focusing on bolt-on acquisitions to build value in existing assets. This buy and build growth strategy requires businesses to quickly scale up, adjust maturing functions and processes to the increased size and complexity.

As a result, investors are looking for experienced finance leaders that have the skills, experience and EQ to lead in the integration of acquisitions. Making buy and build exposure the most in-demand experience for CFOs this year, and we expect this trend to continue going into 2024.

Tom Guy, Partner, specialises in Private Equity CFO and Finance Leader appointments

Contact Tom here>>