Grameen America is more than microfinance—it is a lifeline for women striving to build a better future. Their CFO, Lucas Ramirez, sits down with Jack McCullough to share how they prioritize social impact over financial gain to make actual and tangible change in community and society. He shares how Grameen America garnered impressive growth through its unique approach to microfinance and operational efficiency. Lucas also shares how he found himself in the CFO role, emphasizing the importance of work-life harmony, networking and financial depth.
Listen by clicking below. The Q&A, lightly edited and trimmed for clarity, follows.
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Listen to the podcast here
I’m happy for the guest we have on this episode. This is one of the most interesting companies that I’ve been represented on the Secrets of Rockstar CFOs, plus the CFO is a great guy. I want to welcome Lucas Ramirez. Lucas is the CFO of Grameen America. Lucas, welcome to the Secrets of Rockstar CFOs.
Thank you, Jack. I’m super excited to be here. I’m a big fan of your show, I am a regular listener, so I’m delighted to be here to share some of my journey with your audience.
Grameen America’ Mission
You’re a regular listener. I have two regular listeners and they’re anonymous. Now I’ve identified one. The next time a potential sponsor asks, I can tell them what half of our audience is like. You worked for like a fascinating and important organization. It’s one of those global companies. Why don’t you share a little bit about Grameen America, what your mission is, and other things?
It’s indeed a fascinating organization. Grameen America is the largest and fastest-growing microfinance institution in the U.S. Our mission is to help low-income entrepreneurial women build businesses to achieve financial mobility. I usually think about this in terms of why we exist. We exist to change the life trajectories of low-income minority entrepreneurs who have been marginalized from the financial system. That’s what we do.
We are here to change live trajectories. How do we do that? We do that by running this little bank to grant loans. We do this through a technical assistance organization that provides women with training in health, business, education, the community and the network for them to succeed as entrepreneurs. Grameen America was founded by Muhammad Yunus. He’s a Nobel Laureate and known as the father of microfinance.
He felt that a woman could lift themselves out of poverty through their entrepreneurial spirit if they got the right opportunity. He started giving micro-loans to poor women in Bangladesh in the early 80s. Grameen America has dispersed over $4 billion in microloans to about 190,000 entrepreneurs in the U.S. since it was founded in 2008, but we’re just scratching the surface of what we can do.
We’ve penetrated less than 1 percent of the addressable market. It’s a huge market of low-income entrepreneurial women in the U.S. who are unbanked or underbanked. Over the next decade, we have a very ambitious growth plan. We expect to grow our disbursement by 10 times to $40 billion and reach 750,000 borrowers which is about four times where we are today.
What an important mission and what a great story. I don’t exactly know a bunch of Nobel Peace Prize winners. Have you met him in person doing your job?
Yes. He’s the chairman of our board. He’s still in Bangladesh, but he comes to an in-person board meeting in New York once a year. There, I got to meet him. He is an amazing visionary and inspirational leader who has flipped some of the core finance principles upside down. He proved that through the right program and with the right incentives, low-income people are very credit-worthy, which is in contrast to traditional finance, which says low-income people are subprime, high-risk and have high default rates. Our default rate is 0.2 percent of the portfolio, which is better than any bank. It’s impressive what Professor Yunus has done and the movement he’s created around the world.
I’m not in your industry but how many investments are 99.8 percent?
I followed financial institutions throughout my career for more than 20 years. This is the best credit quality that I have seen even though we’re lending at the margin of borrowers and what you would consider the most vulnerable segments of the population. It shows that with the right program, technical assistance and the community aspect of it, they are very credit-worthy.
Lucas’ Career Journey
I want to talk more about that. First, I’d love you to share a little about your background with our audience. First of all, where did you grow up?
I grew up in Colombia, South America. As people probably know, it’s a country that’s had its fair share of challenges. I view it as something that’s forming. Having the opportunity to grow in a country like Colombia, a low-income country in the midst of a lot of violence, and then coming to the U.S. and seeing the opportunities here. It gives you the whole spectrum of things. I grew up there. I’ve spent about half of my career in Latin America and half in the U.S.
I’m a recovered investment banker. I view that journey of going from a small town in the Andean mountains of Colombia to Wall Street and working at Merrill Lynch before it was acquired by Bank of America in the financial crisis, in which I was there, one of the premier investment banks in New York. It was a formative journey for me. It taught me that with discipline, focus and hard work, you can pretty much achieve what you put your mind into. That was an amazing journey to go from a small town in Colombia to Merrill Lynch in New York.
That’s a fascinating journey. I often ask this question. I’m curious and hopefully, my audience too, but your answer is interesting to me. What was your first job?
I reflected on this initially. I was going to answer about my first real professional job, but my real first job was when I was still in college in Miami. I wanted to make a few dollars. I ended up working for a Colombian underwear manufacturer in Miami in their warehouse. They were entering the U.S. market from scratch. They hired me to join the team and work in their warehouse, doing everything from taking orders, shipping boxes and keeping the books.
I did that for about six months as I finished college. It was the first time I earned a buck on my own. It was interesting to see how a business comes together. It taught me the value of having to earn a living. Up to that point, everything was handed down to me from my parents. I learned the value of earning a living even in a non-skilled job, which I would characterize what I did as a low-skilled job.
You learn everything, the value of the dollar. It gives you a work ethic, and then as probably most of my guests have been, you’ve achieved some good career success, and hopefully been financially rewarded along the way. It gives you value and makes you appreciate it that much more when you have those low-skill jobs in your career. I’ve had people whose first job was an investment banker when they were 22. Good for them. They’re a great place to start, but I think people who worked in McDonald’s or, in your case, in a warehouse, develop an appreciation for things.
It helps me even in jobs like my job now, where we have a big front-line workforce that is in front of customers every day.
My next question was about your first, I don’t want to call it a real job, but maybe it’s your first professional job. Not focusing on that so much, but you have a very interesting path to becoming a CFO. I’m wondering if you can give us a few of the highlights.
As I said, I’m a recovered investment banker. That includes a stint in equity research at Merrill Lynch in New York and covering financial institutions. I did that for about five years. That was very formative in terms of sharpening my analytical skills and learning the fundamentals of financial modeling, valuation, value drivers and industry analysis.
As you know, in these jobs in equity research, you run valuations. You try to make calls on stocks. You talk to a lot of institutional investors at the trading desks. It’s very demanding and it requires a high level of analytical rigor because you’re putting your numbers out there. You’re putting your forecast. You’re even putting your valuation saying, what you think a stock should be worth, and having to go in front of very smart institutional investors from the top asset managers and hedge funders of the world to pitch in investment thesis.
I did that for about five years. I then moved back to Latin America to work in investment banking at one of the largest financial groups in the region. I did a lot of M&A and capital markets work, helping companies expand across Latin America via M&A and then raising the capital for that expansion via equity or debt offerings. I did that capital markets and investment banking stint for about 20 years. I decided then that I wanted to transition to a CFO role and took a year off. I went to school. I spent a year transitioning from investment banking to more managerial roles, but I guess I’ll stop there and see if you want to discuss that transition.
I’m always curious about the people who influence you during the course of your career. When you look back, are there any critical mentors or people who made a positive impact on your career growth and influenced you to be the type of leader that you are today?
One hundred percent. Even from the early days, when you’re job is very technical and you’re an individual contributor. One woman who I admire is a brilliant economist. She was my boss at Merrill Lynch, a Peruvian woman. She mentors me in terms of how to do the job well, how to analyze a company, how to value a company and how to build an investment.
In the early days of my career and then along the way, different folks, including my current boss, who is a great mentor. She’s a very accomplished former Fortune 500 CEO, who’s on the board of Apple and several other Fortune 500 companies. I consider her not just the boss but a mentor and learn a lot from her strategic thinking. Her leadership skills and the way she communicates. I think you have different mentors along the way.
In the early part of your career, they tend to be more on the technical side when you’re more of an individual contributor. You grow up the ranks more by proving that you can do things very well. As you evolve in your career, that portfolio of mentors starts to shift for more leadership people who can think about your career, your leadership style, your communication style, how to make decisions, how to be a more strategic thinker and help you add a breadth of perspective.
That’s great. We’ve all had people like that. It sounds like this was an important one. I want to bring you to the current role because that’s a fascinating organization. You’re on a great path, an awesome career in investment banking and just completed the Sloan Fellows program. I was a traditional MBA. I recall the Fellows program as being a lot more intense than what we dealt with. What attracted you to Grameen in particular?
The obvious answer given that it is a leading social enterprise is the mission and the impact. It was a unique almost once-in-a-lifetime opportunity to combine finance with social impact. Its leadership and its board were certainly very important. I mentioned our CEO, Andrea Jung, and the opportunity to work with her and learn from her was a tremendous career journey. That was a big driver. We have an amazing board of directors of very accomplished leaders in the financial and social space. Also, the nature of the role itself because it was wearing two hats. One is running the finance organization, FP&A, accounting, treasury and IR, and making sure that finance supports the execution of the strategy of the company.
The second hat is a seat in the executive team where you wear a more cross-functional impact, and are there as an architect of executing the strategy of the of the organization. Also, the growth potential. As I mentioned, I think initially the addressable market of low-income entrepreneurial women in the U.S. is about 10 million. We have 100,000 active borrowers. We are just scratching the surface in terms of the impact that we can have and the organization is scaling very rapidly.
The opportunity to come in and work with the leadership team to help architect the next phase of growth seemed like a very exciting place to come spend the next stage of my career, being associated with the movement that Professor Muhammad Yunus created around the world, social impact and the social business, which is using business principles in an enterprise setting to have long-lasting social impact. It’s a place where you wake up every day very excited to come to work because we know that if we succeed, there will be thousands of women who are succeeding and were able to change their life trajectory. There are a number of elements that are grooming me for this role.
Impact of Mission-Focused Company on Leadership Style
I think that’s fantastic. How many times do we get to make that type of impact in people’s lives during the course of our careers? It’s great that you’re doing it. I want to explore a little bit of the impact on you because you went from banking and analytical finance, but now you’re in a company that’s mission-focused, not financial-focused. How does that change your leadership style?
I would start by saying that the answer is it doesn’t change that much because as I said, you apply a business mindset to solve a social problem. You have to run the organization like it’s a business. There’s a bit of context on what is a social business. Professor Yunus wrote an entire book about this. It is using business principles in an enterprise setting to solve a social problem at scale. The company must be profitable. It should make enough revenue to cover its expenses.
I view it more as a non-dividend company than as a non-profit company. In the case of Grameen, we’re a lender and our balance sheet consumes a lot of capital. We need those profits to help grow the balance sheet and strengthen the balance sheet. We need to show strong financial outcomes so that we can attract loan capital. We have a number of banks and impact investors that help us fund the business, and they need to see very strong financial results because they want to get their money back. They want to get repaid.
You also have to show social impact. You have to have proven social impact so you can attract the philanthropic capital that is also important to grow the organization. It uses the same principles, strategic thinking, data-driven and unit of economics. None of that goes goes away. You still apply that, but you now want to achieve financial outcomes for the purpose of not creating shareholder wealth, but for the purpose of creating long-lasting social impact.
The fundamentals don’t change and that’s why also being a 20-year investment banker and finance professional, I joined this because I could fully exercise all my knowledge and experience because none of that goes away. It’s just that the why is different. It’s not to create shareholder value but to create long-lasting social impact. You have to broaden your lens. You have to learn a bit more about how to measure social impact, what are the metrics, and how can you prove that impact.
We’ve done it in a very significant way and we can talk about that later if you like and always have a learning mentality. Sometimes you have to deploy capital and it’s not going to have an immediate financial return, but you’re going to learn something that allows you to broaden the reach of what you’re trying to do or deepen the impact that you’re trying to have on your constituency.
You have a broader stakeholder view because you have philanthropists who are like you’re shareholders. You have investors, you have the board, you have your borrowers. You have to deal with regulators. You have to try to influence the broader financial ecosystem. I would say that you have to you have to up your leadership game in this social business setting relative to commercial enterprise.
When we spoke a couple of weeks ago, you talked about the topic of leadership and becoming a good business person generally. It is getting outside your swim lane. Maybe that’s a common phrase but I hadn’t heard that until you said it. Can you elaborate a little bit on that, what you meant, and how it applies to your current role?
I think what’s going to define the success of future CFOs is the ability to get outside your swim lane. Be more cross-functional when you look at different problems. An example of this is when I joined Grameen, I went on a listening tour. In my first three months, I said, “I’m going to do a lot of sense-making and try to understand this very well before I start making decisions.”
In that listening tour, I asked everyone the same questions. One of which was, “What is the biggest bottleneck for growth?” There was a key theme across those answers, which was the staffing of the branches. There’s high turnover due to reasons such as pay, stressful jobs, a lack of a clear career path, technology and the like. Given that one of the roles of a CFO that I think I have in this organization is to unlock the constraints for growth, and to allocate capital towards that, work together with HR, with operations and with tech.
I looked at the problem from a broader lens. What is the real cost of all this turnover that we’re having? Do we have to replace over a third of our workforce every year? We developed a plan to invest more in people, staff the branches better and pay better. We created a career path in coaching and also changed their work design, so the work is less stressful. We built technology tools to make their lives easier. This led to turnover going from 36 percent to 20 percent. Despite significant investments in people, paying better and staffing the branches better, our profits are increasing 60 percent year on year, and the organization is firing on all cylinders.
The way we achieve that is by taking a broad look at the problem. I think the most complex problems that end up in front of you as a CFO don’t come with a functional label. They don’t come with a finance label. They are systemic problems. You have to look at it from different lenses. I think that’s a good example of how finance can come and contribute actively with capital allocation, analytics and thought leadership to help solve a problem. At first glance, it looks like a human resource problem, but these problems are more interrelated. You have to take a systemic view of them. I think that’s essential to become an effective CFO and not just look at things from the number standpoint.
Relationship with the CEO
That makes a lot of sense. You touched upon your relationship with Andrea Jung. She’s a legend in American business. That’s such a critical relationship between the CEO and the CFO. I heard the CFO is referred to almost as a deputy CEO, but what is that relationship like running this organization together?
It’s a privilege to work for her and learn from her leadership skills and her strategic thinking. One of the things that drew me to this organization was her passion for the mission given her background. She could have done a million other things but she decided 10 years ago to come work for this small microfinance entity that didn’t have a proven model yet. She’s passionate about women’s empowerment.
In terms of the relationship between CEO and CFO, it’s a key relationship. I think of the CEO at times as the flag planter and the CFO as the road builder to help us get there. The CEO is very much in charge of the vision and why we do what we do. The CFO puts structure, processes and systems, and is more in charge of the how. That’s how I view this relationship. It’s putting in the people, processes, systems, rhythm of the execution and strategy so we can achieve our goals.
It’s a relationship that has to be billed on trust. You have to be able to have an open and candid conversation both about the opportunities and different challenges and have open communication. We meet weekly. I try to ask the right questions to make sure that I always know what’s on her mind, what the priorities are and what are the key organizational things where I should jump in, not only from a CFO role but from an enterprise leader standpoint. It’s also important to know when to pull the CEO into financial-related matters and be selective about that.
I strategically bring Andrea into some of the conversations with our investors because there’s no one better than her to come in to tell the story, generate excitement about the mission and build credibility. She’s the number one tool that I have when I need to go and pitch Grameen America to an impact investor. I bring her along and she usually does an amazing job convincing them to invest in our organization. You have to know when to pull them into your workflows.
Managing a Remote Company
It is interesting to hear since she’s one of the best CEOs of her generation. You touched upon the fact that your company is mostly remote. It’s not completely remote. How do you manage that from a talent management and cultural standpoint? What was that like?
It’s certainly challenging, particularly, when we’re growing the team so fast. Our headquarters are fully remote. The staff in our branches do go to the branches because they need to meet customers on a daily basis. We meet once a quarter now in New York for headquarters meetings. It is a challenge for us without a doubt. In terms of managing the team, I try to flip the org chart around and think that I work for the team, not vice versa. There’s a term for this. It’s servant leadership. Your role is to make sure that they succeed because if they succeed in their role, the finance organization succeeds, and then that helps the overall company to succeed.
The key here is to over-communicate in a virtual setting. It’s hard because communication is more scripted. You have a specific agenda for that meeting. We meet every week as a team to go over the table if you will, staff meetings or what everyone is working on, share ideas and give people an update on what I’m seeing in my discussions in the executive team. It’s important to keep everyone on the team abreast of the broader picture, and always tie what they’re doing to the big picture. Otherwise, when they’re on their own doing their own individual work in their house, they can get disengaged if you’re not constantly bringing them in and tying their work to the bigger picture.
In addition to the team meetings, I do one-on-ones with everyone on the team including the most junior folks. We have interns on our team and I do one-on-one even with the interns. You have to ask the right question. I try to adhere to the rule of 30 percent talking where you give them an update on what’s going on or why.
Seventy percent of the time, you should ask questions, listen and have an open conversation about how things are going, what’s working well, what’s not working well, anything that you would like to do differently and make sure that you are able to capture that information that you missed because you’re not in an office setting. It requires you to sharpen your listening skills to be able to do it in a virtual setting and ask the right questions and ask open-ended questions, such as how things are going, anything not working, anything that you would change from your workflow or anything I can help with. The concept of servant leadership is to help them succeed I think.
Another operating principle that I have is empowerment plus accountability. I set the gain commitment to that direction. Ensure you’re constantly communicating the strategic priorities of the organization, but let people fill in the blanks and give them the autonomy to design their jobs. They’re probably better at it than you are because they know the specifics a bit more. You give them empowerment, you set the direction, gain their commitment, you empower them, but also hold them accountable and establish clear goals.
That’s a great answer and it’s an ongoing challenge. More and more companies are going to go that way.
It’s very different to build a culture in a virtual setting.
One thing that I’m curious about is you have a large number of small transactions. I’m wondering what’s the tech infrastructure of Grameen America to make it all happen. I’m guessing you don’t run the company on QuickBooks.
Without a doubt, there are thousands of small transactions, 100,000 per week to be more exact. One of the reasons for our success and one of the things that has allowed us to do this, and this predates me, is the organization’s vision to invest in technology ahead of time. This used to be a very paper-based, cash-based model. We went digital cashless and there was a big digital transformation that started a few years ago.
The business school at UC Berkeley wrote a business case about digital transformation and the pivotal role of technology in scaling. We changed to a cloud-based system for our core banking operations. That was essential to be able to absorb the volume that we have right now of transactions. We now are investing heavily in a borrower app. The member can self-service much better. She can apply for the loans through the app. You have her balance and it allows us not only to improve the user experience and generate efficiencies on the back end but also to much better capture data.
Even in a high-touch model like ours, where our relationship staff meets with members every week often in tube settings. Embedding technology in everything we do is essential for scaling. You can’t scale to 100,000 customers and the 300,000 that I mentioned that we plan to have over the next few years unless you embed technology. Organization-wide, we are much further along in this journey than let’s say in the finance function itself where CFOs are using technology not just to automate repetitive tasks but for more predictive analytics.
We’re earlier in that journey initially on the very transactional side of things. We get 100,000 payments of loans every week. We now have a system that automatically matches the cash coming into what is recorded in our core banking system, to make sure that the books are accurate every day. We’re embedding technology. Everything we do has been very deliberate about being a high-touch plus high-tech model.
In finance in the future, we will use technology not just for automating repetitive tasks but more so for our, working visualization and dashboarding, automating the financial analysis and then down the road for more predictive analytics, such as being able to estimate a borrower’s propensity to default or to forecast profits for growth. It’s an evolution where you go from basic tasks and automation to more sophisticated analytics.
Measuring Impact
I want to ask you a question since you grew up professionally in banking and you’ve got an MBA. You’re probably a very quantitative analytical person in a professional life. What are some of the metrics you use to measure the impact that the organization is making, maybe financial and otherwise? You’re all about the social impact as much as anything. Are there some key metrics that you look toward to make sure that you’re performing to your goals?
That’s also one of the differences between working in a social enterprise. It’s not just with the financial metrics, but you look at the social metrics and even the operating metrics. In any company, you have the financial metrics as a lagging indicator. First, you have to look at what’s going on in the operations, the customers, the churn, the different operating KPIs, then the social and financial metrics. On the finance side, we look at the same metrics that any bank would look at, like capital adequacy, credit quality, liquidity, non-performing loans, unit economics and return on capital.
In a social business, so you have to apply the same business principles. You have to layer on to that the social impact things. We look at the number of borrowers that we are able to impact, the number of loans that we give out, the size of the loans we measure and the impact that we have on their business income, their savings, or their credit scores because we don’t require a credit score for them to join the program. We start reporting to the bureaus and we see if our reporting of their successful repayment has improved their credit scores, and then they can have access to other more mainstream financial products.
We also measured through a randomized control trial, which is the gold standard test done by MDRC, a third-party organization where they did a three-year study of what was the impact of women being in our program versus a control group that was not in the program. We found statistically significant evidence of improvements in income, savings and credit scores, and a reduction in material hardship.
These are a number of social impact metrics that we track. They are very important to get impact investors excited about investing in us because they need to see the impact in addition to its financial strength. We’ll continue to evolve in that in that journey. We’re now going to embark on a project called the Financial Diaries. We go deep into the financial lives of a few of our borrowers, understand how they save the volatility of their income and the volatility of their expenses, and understand what the finances of a low-income household look like.
All of these are to be able to design products for impact, to show the impact that we made on the lives of women, and also to be able to influence the broader financial inclusion ecosystem and mobilize more capital from impact investors and governments towards the financial inclusion space.
Future of Financial Leadership
I want to step back a little bit from your company. The CFO role has evolved so much since I was a CFO and it continues to do so. I’m curious what your thoughts are on what the future of financial leadership is going to be like.
I think the role is becoming much more exciting. It’s becoming broader. It’s becoming much more cross-functional. There’s a study from McKinsey that shows that the number of discrete functions reporting to the CFO role has almost doubled over the past few years from three to four, six, seven, or eight. These include procurement, investor relations, data analytics and risk management.
Many more discreet organizational functions fall into the CFO roles. It’s becoming more complex. This is a phrase that I throw off in our leadership meetings. I want people to view me not as the CF-no. I’m not the traditional CFO who is there to say no to things but as the CF-go. My role is not to say no. My role is to think hard about what to say yes to and how to allocate capital toward the execution of the mission and the growth of the organization.
You’re in a seat where you can allocate capital to both exploration, which is innovation, but also exploitation, which is generating efficiencies in the current operation. I think I mentioned this at the beginning. My CFO role was wearing two hats. One is running the finance function and that trains around the time that we have the capital to run the business.
We provide the analytics, the reporting investor relations and the like, but also have a cross-functional seat at the leadership team where you’re trying to add value to cross-functional challenges such as the one that I mentioned on human resources and reducing the turnover in our field and in our field staff. It’s a role that is very much driven by technology these days. You have to embed technology in everything you do if you want to scale the organization, which is what we’re doing at Grameen America.
Work-Life Harmony
I want to get back a little bit to your personal life. A lot is going on. How do you do it with the work-life balance thing? It’s so important that you’re not just working 90 hours a week. Do you have any advice for people trying to achieve it?
It’s a constant challenge. That’s why I think of it more as work-life harmony instead of balance because it’s hard to have balance with such a demanding role. It’s important to take good care of yourself first. Manage your energy and manage your mental and physical health. You can’t show up in your job with the level of energy that you need.
The way I try to manage this is first, you need to be strict and set boundaries around your time because the CFO role in an organization that is scaling rapidly can consume 100 percent of your time. You have to be strict with your boundaries. I personally try to keep a very disciplined routine of physical and mental health in terms of exercise and meditation. It’s things that I do almost every day. I used to not do it when I travel for work because you’re in hotels and you’re running around. Now I have an app and I even exercise for 15 minutes in my hotel room if I can in the morning. That changes your energy, the way you show up in meetings and the level of energy that you bring into the conversations.
I mentioned work-like balance. You said energy and whatnot. I was instructed to ask you this question. I know you’re a runner. What’s on your playlist?
When I run in the street outside I don’t listen to anything, but when I hop on a treadmill at home or in a hotel, I listen to podcasts. One is this podcast. It’s a must. I enjoy listening to the stories and journeys of other finance leaders. Another one that I often listen to is called A Bit of Optimism and this is hosted by Simon Sinek, which is more about personal development and leadership. Sinek is the author of a great book called Start With Why.
He’s an icon.
He has a great podcast for inspiration and personal leadership. I recently started listening to audiobooks and there’s one that I finished a few weeks ago that I highly recommend. It’s called Outlive by Dr. Peter Attia. It is a very interesting and well-researched book about lifespan and health span, and what you can start doing in terms of nutrition, exercise, mental health and sleep to achieve longevity so that you have a healthy span in those final years of your life.
I want to make sure we got this for the listeners. Take note, he listens to two podcasts, mine and Simon Sinek’s. That’s probably the one and only time in history that he and I have ever been mentioned in the same sentence. I’m going to feel that a little bit. Thank you for that. I didn’t know what your answer was going to be. Jess who produces the podcast encouraged me to ask that. I was guessing it was going to be music and because she knows my taste. I listen to the same music I listened to in 1984, AC/DC and Van Halen. I was thinking maybe you and I had the same musical taste. On the work-life balance thing, you have a teenage son. What’s his name?
His name is Samuel.
Advice for the Next Generation of CFOs
That’s a big thing. I always like to conclude by asking CFOs what their advice is for the next generation of CFOs. You’re in a mission-focused organization so you can tweak it towards that or not. It’s your choice.
In general, I guess there are three things. Have financial depth. That’s table stakes, but seek a breadth of perspectives. Go outside of your swim lane. Learn about HR, operations, tech and strategy to become well-rounded. The success of the CFO role will be defined more so by the ability to go outside of your swim lane.
The second thing is to build a network. Invest in your relationships inside and outside of the organization. You will need a strong operational network inside the organization to get things done. You will need a strong developmental network outside of the organization to broaden your perspective and seek new ideas. I read a book early in my career called Never Lead Alone, and the author is Keith Ferrazzi. That changed my perspective on building a network. Sometimes people view networking as a dirty word, but it is essential to succeed as a CFO or in any business role. Build that network and invest in it even before you need it.
Lastly, become tech-savvy. Technology is transforming all into industries and the finance function. Tech and AI will not replace the CFO role, but tech-savvy CFOs will be much more effective and successful in adding value to their organizations. In terms of mission, the social enterprise world is growing significantly. It’s becoming an important type of organization in the world. The impact investing space is also growing very rapidly. The assets under management industry is now in trillions, I read recently.
If you are going to join a mission-driven organization as a CFO, the thing that you have to ensure is that you’re aligned with the mission and that it’s something that you’re passionate about. Make sure that it’s a social business that values financial rigor. Not all of them do in the same way as Grameen America does.
When I was looking at this role, I understood that financial rigor was very much valued, and it was a very important part of what we were doing. Make sure that if you’re going to join a social enterprise, it’s financially disciplined and where financial metrics and rigor are taken into consideration for making decisions.
That’s sage advice, my friends. Thank you, Lucas. With that, I’m going to give you the final word.
This has been a fantastic conversation. It has provided me with a great opportunity to step back, reflect on my career, reflect on my journey, and reflect on this role and how I should think about it going forward. I’d encourage listeners and folks to set aside time throughout the year to think strategically about their careers.
There has never been a better time to be a CFO. The role is much broader. It’s more cross-functional and requires strong interaction both internally with other functions, but also externally with stakeholders such as investors and board members. It has become a key driver for strategy execution and for measuring and managing the value of companies.
Importantly, the CFO role is a role where you can never stop learning. There are always new challenges that come your way. For people who are passionate about lifelong learning and who have intellectual curiosity, this is a fantastic role. On that note, I learned a lot from listening to other CFOs on your podcast. I look forward to continuing to listen to others and learn about their journey.
