By Antonia Halliday
Private equity firms are often quick to define the ideal CFO when they acquire a portfolio company. The briefing usually centres on pedigree. A CFO from a listed business, a large corporate, or a familiar network tends to tick the boxes. It is understandable. Sponsors want someone they can trust to deliver financial control, reporting, and compliance. They want reassurance. What they often miss, however, is that the CFO their portfolio actually needs is frequently a very different profile.
The challenge lies in the gap between experience and environment. Large corporate CFOs are accustomed to abundant resources, established processes, and long decision cycles. They thrive in predictability, in depth and structure. A PE-backed business, by contrast, is characterised by ambiguity, compressed timelines, and a constant focus on value creation. The finance function may be lean, the data messy, and the expectations high. This is the environment in which the wrong CFO can slow progress, or even worse, erode momentum in the business.
I have seen this pattern repeatedly across technology businesses backed by both venture and private equity investors. The most successful CFOs are not necessarily the most decorated. They are commercially minded, operationally confident, and comfortable in situations where the answer is rarely clear-cut. They know how to prioritise, when to escalate, and how to translate financial insight into actionable decisions for both founders and sponsors. They are fluent in the language of growth, not just reporting.
This is not to underplay technical excellence. The right PE CFO must be financially strong. But technical skill alone is insufficient. A CFO joining a high-growth, PE-backed company must be able to navigate cultural complexity, manage limited resources effectively, and partner with leadership to deliver rapid, measurable impact. They must be able to challenge constructively, influence without authority, and operate as a trusted advisor to both the board and the executive team.
Too often, the briefing assumes that pedigree alone equals readiness. I have been called into numerous situations where a highly qualified CFO needs to be replaced as they have struggled to adjust to the pace and scope of a PE-backed business. I have also seen numerous situations where CFOs with a less conventional background, but the right mix of skills have been barnstorming successes. The difference is not subtle. It can determine whether a business accelerates or stalls.
For private equity sponsors, recognising this distinction is critical. CFO hires are not simply functional appointments; they are strategic hiring decisions that very often are the most impactful decisions on the success of the company. Getting the hire right requires a deep understanding of both the company and the type of CFO that can thrive in that environment. It is about identifying potential and capacity to adapt to the business as much as it is about credentials.
I’ve been helping clients to hire CFOs for 15 years now and in that time I have seen the massive transformative effect of CFO hiring – both good and bad.
In the coming weeks, I will explore this theme further. I will examine why traditional corporate experience can be a red flag, what the first 180 days reveal about fit, and how investors’ expectations of a ‘commercial CFO’ translate into reality. The goal is to provide insight for sponsors, boards, and CFOs themselves, and to encourage a more thoughtful approach to hiring
Ultimately, understanding the gap between the CFO that PE firms think they need and the one their portfolio actually requires is the first step towards smarter hiring.