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Ross Tennenbaum loved working in investment banking, so it took the right opportunity for him to make the jump into his first role as CFO at Avalara, a SAAS company building cloud-based tax compliance solutions to handle every transaction in the world.
While in investment banking, Ross learned not only about capital markets and mergers and acquisitions, but about the strategy of the companies he advised on. Ross brought that mindset to Avalara, asking all kinds of questions to drive Avalara’s business forward.
Ross is laying the groundwork at Avalara to help match the fast growth of today, as well as tomorrow. He’s doing this by investing in the right technology to help optimize finance operations, and hiring finance team members who have experience implementing automation. As he builds out the finance team in a competitive environment, he’s intentional about facilitating a fulfilling work environment with clear paths of success for the company as well as individual team members.
On this episode of The CFO Playbook, Ross Tennenbaum, CFO at Avalara, describes why he left investment banking for the lure of CFO, outlines the key components of a high performing finance team, and shares the automation priorities he’s focused on for the year ahead.
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Name: Ross Tennenbaum
What he does: Ross is the CFO at Avalara, a SAAS company building cloud-based tax compliance solutions to handle every transaction in the world. Two years into his first tenure as CFO, he’s applied what he learned from years in investment banking to understand the business, invest in technology, and build an engaged finance team.
Key Quote: “My biggest advice to people if they’re building a company is don’t under-invest in the back office technology. It’s easy to do because you put all your money in sales and marketing, but you end up paying more later.”
Where to find Ross: LinkedIn
You don’t necessarily need to make changes right out of the gate
When Ross made the jump from investment banking to his first time role as CFO at Avalara in 2020, he didn’t come in and make bold moves just to make a statement. Instead, he helped finance operations grow with the company as its international reach expanded and served the company’s needs as he deepened his own knowledge of all aspects of the business.
Understand your company (and ask the right questions)
Ross emphasizes that understanding the business is his number one priority as a CFO. Coming from banking, he learned not only about capital markets and mergers and acquisitions, but about the strategy of the companies he advised on. Ross brought that mindset to Avalara, asking all kinds of questions to drive Avalara’s business forward.
In a competitive job market, create a clear career path and team culture
While Ross says Avalara benefits from being able to tap into an international talent pool, he also underlines the importance of creating a clear career path for prospective and current employees. He stresses that team members should all feel valued, crystal clear on where the department and company is headed, and aligned on the goals that are going to get you there.
Hire finance professionals with a tech background
Avalara is a tax automation company, so the value of automation and technology is baked into the company’s purpose. When it comes to the finance operations, Ross knows they have room to improve so he is intentional about hiring finance team members who have experience in implementing automation. That way, they don’t need to be reliant on a Center of Excellence. Instead, the knowledge base is right within finance.
“I learned a ton about not only the capital markets and M&A, but really the strategy of a company. How do you think about strategy? How do you think about what your competitors are doing? How do you think about moves you should be making or not making? And it got me some really great exposure to boards and executive management teams.”
“We hired some people that come from doing automation in finance departments at other companies and said, ‘let’s go tackle this.’ So I think that that is money really, really well spent because they will start to automate routine functions and make you more optimized, make you better, make you faster and also free up your people to do other things.”
“At Avalara, our CEO and our former CFO were very thoughtful in this transition…I remember [our CEO] saying ‘I like my CFOs to be really deep in the business, really understand how operations work, work across the Isles from finance, understand how finance works from the other side and everything else.’ And so the good news was I sat right next to our former CFO. And I sat on his staff and we spent quality time together after hours and during business hours.”
“You’ve got to become really good at being resourceful and finding networks and being able to ask the right questions and learn. You jump into a CFO role and you don’t have someone above you to ask you, all right, what do I do next? You gotta go figure it out.”
“The number one thing to me is you’ve got to really understand the business, how it works, what are the drivers, what are the levers, so that you can really be in a position to help optimize it and drive it and grow it, and not just be the person that’s handling the purse strings.”
“And I remember thinking that there’s not so many times in your career where people reach out to you and ask you to do a job that you’re not necessarily qualified to do. You’re taking a leap into venture capital or operations role you haven’t yet done and it’s because it always comes back to: ‘your next job won’t be from your resume, it’ll be from your network.’”
“To me a career is about putting together many different disparate experiences, you know? And so you’re continuing to, it’s not just moving up, but it’s continuing to build the areas of knowledge set, and experiences that come together to give you a unique set of skills and experiences.”
“You understand how the businesses work, you understand how the different functions work. You understand how the functions need to work together. And I think you understand how to be more empathetic, which is a really important word in my career to how other functions and leaders, what they need to do, what their mission is, how it all works and how to work across the aisles with them and really understand the levers that you can pull to drive the business.”
“I’m pretty knowledgeable in accounting. I’ve always liked accounting. I spent time in the weeds of it. I’m not a technical accountant. I didn’t come up from that realm, not a CPA to be fair. And so there’s different ways to come up and be CFO. I didn’t come from that area. So we have a really strong Chief Accounting Officer that’s been at the company since prior to going public.”
“I think by expanding the aperture of where you’re willing to hire, I think by being willing to say, okay, there’s some senior leaders that aren’t on the ground here and that’s okay. It’s opened more opportunities.”
“I think bankers always have to go figure out really hard problems with limited information, and overnight, and that’s a really good skill. And then you go into a company and you’ve got all the information. How do you synthesize a lot of information? How do you make it compact? How do you make it simple? And how do you communicate it effectively? I think that those are all important to hire great people that can do that.’
“Empathetic culture and career paths are really important. How do we create the vacuum where you can actually pull people up and people can see, ‘Hey, things are moving. I can put my hand up. I can get a career path going. I don’t have to go look outside the company.’”