Understandably, newly hired finance chiefs — especially those in their first such role — often don’t have much to say to the outside world about the strategies they’ll be pursuing or what success might look like in the new job.
Still, they can have important voices. Indeed, one’s path to the job and career viewpoints can be instructive and even inspirational for other aspiring CFOs.
When we spoke with Sarah Dickens Spoja in late August, it was her ninth day running finance for Tipalti. The company, which provides a subscription-based accounts payable automation platform, was included in our annual “Technology Companies to Watch” feature this past spring.
Asked about her strategic priorities going forward, she answered in only the most general terms, inviting us to reconnect in a few months for a more detailed response.
Spoja’s background, however, suggests that good things are likely to come.
After graduating from Williams College in 2004 with a double major in mathematics and economics, she went straight into a four-year gig with prestigious management consulting firm Bain & Co. There, she was heavily exposed to private equity, working on projects in the areas of buy-side diligence, customer research, and new product potential.
Next came Stanford University Graduate School of Business, where Spoja earned an MBA in 2010.
Newly minted diploma in hand, her first aim was to put her private equity experience to work. So she joined KKR Capstone, an independent firm that provides support for the deal teams and portfolio companies of PE giant KKR.
She and her colleagues spent a portion of their time “doing diligence for new investments, understanding whether they were good and in particular what types of value improvements KKR could make on them as owners.” Another chunk of time was devoted to existing portfolio firms, along a spectrum from project work to “actually having a seat in the company and taking on a role.”
Spoja calls it “probably the best job I could have had.” While she had done more traditional strategic consulting during her years at Bain, she “wanted to get more skin in the game,” which is what drove her to private equity.
“I wanted to be involved not only as an adviser but also as a shareholder,” she says. “With every project I took, I thought about how to align my interests with the management team’s interests.”
While she rose to become a director at KKR Capstone, Spoja’s next logical career step was to “go to work in a company and have a seat at the table more directly,” she says. “I talked to headhunters for a few years about chief operating officer or strategic CFO jobs. I was looking for the right combination of people, product team, and vision of where the company was going.”
She was particularly interested in opportunities at financial technology (fintech) companies, the focus of half of her work at KKR Capstone.
Notably, she had worked on the acquisition of a small fintech firm, Clover Network, by First Data, a large fintech company that KKR bought in 2007 and took public in 2015.
“After we did the deal, I worked for two years alongside the founders of [Clover] in a chief commercial officer-type role,” Spoja says. “I did everything from planning out the teams and the budgeting to doing the business development work and setting up bank partnerships.”
The small firm initially leveraged the sales, marketing, and customer-operations muscle of 25,000-employee First Data, but now has hundreds of employees of its own, she notes.
When the Tipalti opportunity came around, Spoja says, she performed due diligence on the company and its financial models “exactly as if I were a KKR executive [trying to understand] whether I wanted my money in this business — because at this stage of my career, my time is my money.”
Spoja was particularly attracted by Tipalti’s customer-retention rate, “which was higher than any I’d seen in the due diligences I’d done in the B2B fintech space,” she says.
Tipalti is a much more mature company than Clover was when First Data acquired it. “But it has a lot of the same qualities,” Spoja says, “in terms of saying, how can we continue to grow at the speed we are, satisfy our customers’ needs, open up more addressable markets for our products, and fund the growth.”
Like other businesses with subscription-based models, Tipalti benefits from recurring revenue that enables consistency in year-to-year planning.
At the same time, how much revenue from any particular client will recur in subsequent periods may be somewhat more variable for Tipalti than for some other fintech companies.
Tipalti’s clients use its platform to pay their suppliers and partners. Revenues are generated both by clients’ usage of the product and by choices their payees make, including payment type, what currencies they accept, and whether they accept early payments.
“As our clients grow, their usage of the product grows as well,” Spoja says. “However, these dimensions are outside of our control, so we must use modeling methods to forecast our revenues even if some factors that drive revenue growth are not known to us until they happen.”
Both fintech and the payments space have fast-evolving ecosystems, Spoja notes.
“Understanding the many dimensions in those ecosystems and all the various participants — banks, associations, competitive or complementary products and companies — is important, and they’re changing all the time,” she says.
“So, a strategic view of where the market is going, and thinking about how we want to position Tipalti to best serve that market, and to best partner within that market, is important as well — and maybe more so than in some other industries.”