If you’re a finance professional contemplating a move into a venture-backed company, there are key changes in work experience you need to anticipate.

Taking the Career Leap into Startups for Finance Professionals

If you’re a finance professional contemplating a move into a venture-backed company, there are key changes in work experience you need to anticipate.

The dynamic world of finance in venture-backed startups is an entirely different ball game compared to the well-established corporations.

If you’re a finance professional contemplating a move into a venture-backed company, there are key changes in work experience you need to anticipate. Below are seven pivotal considerations.

Check out our past article on hiring CFOs here

1. Budget, Resources, and Compensation

Startups often require you to accomplish more with fewer resources. Unlike in a banking setting where you might have a myriad of personnel working on an IPO or M&A deal, a startup might only afford a handful. Additionally, budgetary priorities change. Costs that seem negligible in the banking world for example will be significant for a growth-stage startup.

2. Job Scope

If you come from traditional finance backgrounds, you might be unaccustomed to hands-on operational work. However, in startups, being versatile is key. Sometimes, you might need to step into roles that the company cannot yet afford to hire for.

3. Growth

When transitioning to a startup, dedicating time to truly understand the business is crucial. Growth dynamics shift. While established corporations may view double-digit year-on-year growth as a win, venture-backed companies might aim for even larger strides, doubling or tripling revenues.

4. Hiring Ability

Your expertise may lie in specific financial areas like FP&A, Treasury, or Tax. However, it’s unlikely you’ll excel in every domain. Over time, you’ll need to broaden your knowledge. But more importantly, surround yourself with individuals who can cover areas where you might lack expertise. As the organization grows, your ability to hire the right talent becomes as crucial as your individual skills.

5. Stage of the Startup

Different startup phases may suit different professionals. While those with vast corporate experience might be more effective in established startups like Grab or Uber, others may shine during the scaling phase but struggle in seed stages due to the dearth of structure. Recognize where you fit best.

6. Decision Making Speed

The pace of decision-making dramatically escalates in startups. Gone are the long, drawn-out processes and multi-stakeholder discussions typical of MNCs. In the startup realm, decisions often need to be made almost immediately with limited consultation.

7. Experimentation

Innovation in startups is fueled by experimentation. Making decisions – even incorrect ones – can offer invaluable lessons. In startups, the fear of stagnation often outweighs the fear of failure.

Implications for Hiring CFOs and Finance Professionals in Startups

Startups need finance professionals who can seamlessly blend into their dynamic environment. When hiring, it’s essential to assess candidates’ adaptability and ability to prioritize swiftly. Prioritize hiring for roles that plug gaps in the finance function and resonate with the company’s immediate needs. Above all, seek professionals who grasp the business model, not just those who bring a skillset to the table.

In summary, for finance professionals eyeing a startup move, the transition can be both rewarding and challenging. Awareness, adaptability, and a readiness to wear many hats can make the journey smoother and more fulfilling.

Read about more in-demand roles we see in today’s markets

Sharings from our CFO calls on the On Call with Insignia podcast and Insignia Ventures Academy‘s StartCFO masterclasses

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Paulo Joquiño is a writer and content producer for tech companies, and co-author of the book Navigating ASEANnovation. He is currently Editor of Insignia Business Review, the official publication of Insignia Ventures Partners, and senior content strategist for the venture capital firm, where he started right after graduation. As a university student, he took up multiple work opportunities in content and marketing for startups in Asia. These included interning as an associate at G3 Partners, a Seoul-based marketing agency for tech startups, running tech community engagements at coworking space and business community, ASPACE Philippines, and interning at workspace marketplace FlySpaces. He graduated with a BS Management Engineering at Ateneo de Manila University in 2019.