Performing the role of CFO in a startup is very different to that of the CFO in large enterprise. CFO in a hyper growth startup is different again ! Alexandra Cain has written a great piece capturing the themes from my interview of Graham Burdis, CFO at v2food.
This article was first published on the CFO Magazine website here
v2Food has followed an incredible trajectory since it was founded only two years ago. Since then, the business has raised $130 million from investors and become the top plant-based meat company in Australia.
Chief Financial Officer Graham Burdis has been at the helm throughout that time, positioning the business to become a billion-dollar entity in the future.
The company has the backing of veteran Aussie businessman Jack Cowin, renowned for bringing KFC and Hungry Jack’s – the local version of Burger King, to this market. v2Food’s science comes from CSIRO.
During a recent CFO Lunchtime Live Webinar, Burdis explained the v2Food’s purpose is to help feed the world’s population, which is slated to rise to 10 billion people by 2050. “We can’t do this with the systems we have now; we need new systems,” he told the audience.
Achieving scale the greatest challenge
Burdis and the v2Food team have had to develop a keen eye for the future to be able to position the business for what is anticipated to be an enormous period of growth.
He credits a diverse range of views on the board as a strength. The venture capital investors contribute uncanny insights into the future and a go-for-it approach. While other board members with a lifetime of experience contribute a different perspective.
Nevertheless, building a start-up is an uncomfortable experience. Burdis says his stage of life helps. “It’s a thrill for me being uncomfortable later in my career.”
The team’s join commitment – genuine concern for how the global population will be fed in the future – gives everyone a common goal.
“We’re looking to solve a true issue that needs to be resolved and everyone in the business is here for that reason. I can be uncomfortable because the end game important.
“Most businesses are mature and have only limited potential for growth. In those businesses it’s possible to wait for proof of concept and make decisions on internal rates of return. But we were buying factories and software systems even before we had a product.”
From a finance perspective, this meant investing in a cloud-based enterprise resource planning (ERP) platform, Oracle NetSuite, when there was only two people in the finance team. It’s proven to be an incredible valuable investment. v2Food recently opened a wholly-owned subsidiary in China, and NetSuite allows the business to prepare tax and accounting information in Mandarin and navigate the Chinese tax system.
In terms of the vision, Burdis says the business has an underlying philosophy of always looking towards the future. “We’re always looking towards the next 12 months, we’re not so focused on the remains of the budgeted year.”
Nevertheless, having a view of the future helps the team prioritise its work. “We’re in a hot space. The VC guys know what’s going on before anyone else – they can see the future. Sustainability, and not just environmental sustainability is their top issue.”
Burdis says it’s a challenging area because unlike other aspects of accounting, there are no readily-agreed standards or measurement tools. He says CFOs and finance teams must play a role negotiating this.
When it comes to communicating with investors, v2Food is unusual in that it already has a dedicated investor relations executive, who is also responsible for liaising with the board, members of which have also invested in the business.
“Investors all have different reporting requirements. We still have to produce historical information, but we’re always looking at the future. Start-ups often talk about hockey stick revenues and investors want to know where you are on the hockey stick,” he explains
Food tech leaders
Burdis says while v2Food is first-and-foremost a technology business, it’s different to pure tech start-ups given it has factories that house specialist equipment and makes products to strict quality controls. This means its capital expenditure is quite different to firms whose products are largely digital.
As for the future, v2Food has global aspirations, with Europe the next market in its sights. NetSuite will also be able to accommodate v2Food’s entrée into this market, even with the different languages and accounting regimes that operate across the continent. It’s also aiming to enter developing markets with products that deliver protein to populations that can’t widely afford meat now.
In terms of Burdis’ advice to CFOs with aspirations to be part of a unicorn – a start-up with a billion-dollar valuation – he says more than likely you will need to be involved in multiple start-ups before the big one comes along. It’s also important to be comfortable with failure.
It’s good advice for anyone in finance wanting to take a risk and be part of an initiative with huge future potential.
This CFO Lunchtime Live WebCast was in proud partnership with
James Solomons 