There's a lot that goes into the day-to-day operations of your organization's finance department. From managing cash flow and keeping up with payroll to overseeing market trends and recommending strategic decisions, it can be helpful to have a single executive oversee it all.
Enter the Vice President (VP) of Finance — an important leader on an executive team that can help your organization meet its financial goals. Let’s examine what a VP of Finance does and what to look for in a candidate for this role, so you can hire with confidence.
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Vice President of Finance Job Brief
A VP of Finance is an upper-level executive who oversees and manages the everyday finances of a business or organization. They often oversee all aspects of accounting and finance operations, including payroll, financial planning and reporting, budgeting, risk management, and more all in line with an org’s growth strategy.
Generally speaking, a VP of Finance assesses and interprets the "big picture" of an organization's financial health. This is mostly done through direct management of the company's finance team (including financial analysts, bookkeepers, and accountants).
Who Does a VP of Finance Typically Work With?
The board and similar executives may expect a VP of Finance to communicate with them regularly. VPs of Finance will provide detailed reports and present key information about the company's financial status to help executives make informed decisions.
In this highly complex line of work, VPs of Finance must be able to assess and interpret an organization's financial performance and metrics. However, they also need to be capable of translating this technical information to other higher-ups and decision-makers, such as members of the board.
Vice Presidents of Finance are typically inward-facing leaders, working to oversee and manage all aspects of an organization's finance team. However, in some companies, this role can have a public-facing component.
Who Does a VP of Finance Report To?
In terms of a company's organizational structure, the VP of Finance typically reports to the Chief Financial Officer (CFO). However, in smaller companies, the VP of Finance and CFO may be the same person, or the VP of Finance may also serve as an executive director.
Chief Financial Officer vs. VP of Finance: What's the Difference?
The titles "VP of Finance" and "CFO" are often mixed up, which is understandable. These two roles do have some similarities, as they both deal with high-level financial responsibilities in an organization. In fact, in some smaller companies, the CFO and VP of Finance may even be the same person.
In companies where this is not the case, however, there are some notable differences between these two positions. Typically, the CFO is more of a public-facing, strategic role, with responsibilities that may extend to presenting financial reports to investors and shareholders.
A VP of Finance, on the other hand, tends to be more of an inward-facing, operational role. These executives oversee a company's entire finance team and work closely with them to carry out everyday operations. While a VP of Finance may have to present or report to board members, they don’t typically have any responsibility to address the public.
When Should a Startup Hire a VP of Finance?
So, when is the ideal time to bring a VP of Finance on board? Let’s explore a few scenarios that demonstrate when this role may be crucial for a startup’s success.
- Scaling operations: When a startup experiences rapid growth, a VP of Finance can help manage financial operations, forecasting, and help secure additional funding needed to fuel expansion.
- Shifting financial strategies: If a startup is adjusting business models (which can happen a few times as part of a startup’s “growing pains”) or exploring new markets or merger/acquisition opportunities, a VP of Finance can help assess the financial viability of these shifts and structure deals.
- Preparing for an IPO: Once a startup gets ready to go public, it’s more important than ever to have sound financial reporting, compliance, and investor relations. The VP of Finance can handle these initiatives and ensure that the company meets the requirements needed to become a publicly traded company.
VP of Finance Duties and Responsibilities
The exact roles and responsibilities of a VP of Finance will vary based on many factors, including the industry, size, and structure of the company. However, most professionals working in this capacity take on the duties of overseeing and managing different aspects of an organization's finances, such as:
- Developing and executing comprehensive financial strategies aligned with the company's overall goals and growth objectives.
- Collaborating with executive leadership teams to develop strategic financial plans, including acquisitions, mergers, and capital-raising initiatives.
- Conducting detailed financial modeling and scenario analysis to assess potential investments and cost-saving initiatives.
- Overseeing the budgeting process, collaborating with department heads to create and monitor budgets that optimize resource allocation and support strategic initiatives.
- Guiding the finance team, ensuring accurate and timely (monthly and quarterly) financial reporting, forecasting, analysis, and compliance with accounting best practices.
- Leading cash flow management, optimizing working capital, liquidity, and capital allocation to support ongoing operations and future growth.
- Overseeing the preparation of timely and accurate financial reports, statements, and presentations for internal stakeholders, executive leadership, and external partners.
- Evaluating and driving cost-saving initiatives, identifying opportunities for operational efficiency and profitability enhancement.
- When necessary, performing administrative duties such as accounts payable and receivable, payroll, and tax preparation.
- Managing the finance and accounting team, overseeing growth opportunities, bridging skills gaps, and managing talent for team growth.
- Tracking revenue, expenses, and other aspects of a company's finances.
VP of Finance Skills, Education, and Qualities To Look For
While different companies prefer different skill sets, educational backgrounds, and experiences, there are a few key things to look for as you begin your search.
Skills
- Proficiency in commonly used financial software/tools, including NetSuite, Quickbooks, FreshBooks, and Xero.
- Knowledge of industry-specific tax requirements and compliance/regulations.
- Mergers and acquisitions activities, including due diligence, valuation, and integrating financial systems and processes.
- Long-term strategic planning including forecasting, budgeting, and scenario analysis.
- Risk management, including identifying, assessing, and mitigating financial risks that threaten the company’s financial stability (credit, interest, currency fluctuations, etc.).
- Strong communication, collaboration, and negotiation skills
- Proven analytical, critical-thinking, and problem-solving skills.
- Ability to adapt to last-minute changes and requests.
- Strong time-management and multi-tasking skills.
- Ability to look at the "big picture" without overlooking the smaller nuances.
- Ability to lead a team and keep team members motivated, informed, and on the same page.
- Ability to present ideas in a way that is easily accessible, even when the information is highly technical.
Education, Certifications, or Experience Requirements
Most companies looking to hire a VP of Finance want candidates with a minimum of a bachelor's degree in finance, economics, accounting, or another related field. However, it is not uncommon for companies to require a master's degree in a related field, such as a Master's in Business Administration (MBA).
Ideally, a VP of Finance candidate will also have plenty of experience working in a finance-related role, such as a senior accountant, financial analyst, financial controller, or financial reporting manager. Having even a few years of experience in this type of role can provide valuable insights that will serve a VP of Finance well.
In addition to education and experience requirements, many companies also look for VP of Finance candidates with relevant professional certifications. These certifications can include:
- Certified Public Accountant (CPA)
- Chartered Financial Analyst (CFA)
- Certified Management Accountant (CMA)
Find Your Future VP of Finance With Hunt Club
The VP of Finance plays a major role in your organization's financial management, helping your company grow and carry out initiatives to achieve its short- and long-term goals. Of course, with so much at stake, having the right recruiting process in place is critical.
That’s why Hunt Club is here to help.
Hunt Club approaches recruiting differently, leveraging a referral-based search, automated screening tools, and an expert network of connections to help you recruit top talent and find your future finance leader.
