Greer wrote about his experiences in the well-received book Starting From Scrap (Burford Books, 2010), which he wrote after stepping down in 2008 as chief executive for Asia of the recycling division of Smorgon Steel Group (now OneSteel), the Australia-listed conglomerate that bought Hartwell Pacific in 2003. Now a senior adviser at distressed debt and private equity firm Oaktree Capital, he spoke to CFO Innovation’s Cesar Bacani.  

 

To be honest, the CFO decision was very much investor-driven. Our investors were saying, “I’ll sleep better at night if we have a CFO. Go get me a CFO. Pay whatever you got to pay.” It really disrupted the pay scale too, and so you’ve got to keep [the CFO’s compensation] a secret. But people get to know about it, and then they think, Who’s this fancy-pants guy who doesn’t have to work as hard as we do? He leaves before us and tells us to get everything ready for him by the morning. It really was a clash of cultures.

 

I think CFO sometimes is [just] a fancy title that people really relish. One mistake we made along the way was that we kind of skipped having a financial controller and tried to jump right to CFO. The reality is, we needed a financial controller but we kept hiring CFOs, and the CFOs come and say, here’s my business card. They don’t want to get their hands dirty, they want to have a financial controller working for them.

 

I think that for a fast growing start-up, you probably want a really good nuts-and-bolts financial controller and you get the CFO the year before you go public. Unfortunately a lot of people who work in large corporations as financial controllers, when they take the risk of coming to a start-up, what they want is the CFO title. So you give it to them. Then they go, wait a minute, I’m the CFO. Where’s my financial controller?

 

I was very impressed with him because he could speak with me on a high level, but that frankly was all he could do. When he had to deal with the junior people on the lower level, they could talk circles around him.

 

My honest experience is that the CFOs that we hired from large multinationals had a difficult time in a fast growth start-up because they are so used to having so much infrastructure around them. There’s a problem with IT, call the IT guy; there’s a problem with the balance sheet, let’s bring in the balance sheet expert. Got a tax problem? Call the tax guy. If you’re in a small fast growth company, you’re that guy. You have a lot of hats on your desk, so you got to be very flexible. Same with the CEO, same with everybody else.

 

When there’s a fire, you don’t call the fireman – everyone grabs a hose. That’s the kind of mentality in an entrepreneurial environment. To me that’s exciting and interesting. You get to cross pollinate and do a lot of different things. I don’t want to be in a silo. But some people want to be in a silo. If that’s someone who wants a very structured environment, they will fail. As successful as they will be at a multinational, they will fail in an entrepreneurial start-up.