This episode, Tom is joined by Colin Wittmer, CFO at PwC, to talk all things AI, upskilling and M&A.
In this episode, Tom is joined by Colin Wittmer, CFO of PwC. Colin's 31-year journey at PwC has seen him transition from the audit practice to a leadership role in finance, with a significant focus on deals and transaction services. Unlike the typical technology-centric CFO, Colin emphasizes the importance of human skills in AI-driven transformations. He offers insights into the evolving role of finance leaders, the impact of AI, and how to cultivate leadership within the organization.
Guest Quote:
“As a CFO, you see the whole picture… where a good CFO really excels is being able to connect the dots so everyone understands how something happening in one part of the business affects the rest.”
“If you start managing the business like you have a lot of cash, you can easily go sideways when things get tough. It’s maintaining that discipline in good times and in bad times.”
“Make the tough decisions early and stay the course. The companies that don’t come out of restructuring are the ones that defer making the hard decisions.”
Timestamps:
01:07 Colin Wittmer's Career Journey
02:27 Insights on M&A and Finance Leadership
07:34 The Role of AI in Modern Finance
08:49 AI Implementation at PwC
12:58 Balancing Human Skills and Technology
14:44 Continuous Learning and Adaptation
25:43 Advice for Aspiring CFOs
26:50 Balancing Client and Firm Management
27:54 The Importance of Leadership
28:26 Evaluating Career Decisions
29:54 Market Trends in M&A
31:52 Red Flags in Finance Functions
34:58 Future of the CFO Role
41:30 Personal Insights and Hobbies
44:41 Recommended Reads and Conclusion
Links & Resources:
Colin Wittmer
[00:00:00] Thomas: Welcome to Liquid How CFOs Outperform. I'm your host, Tom Gavaghan, and today I'm joined by special guest Colin Wittmer. Welcome Colin. On today on liquid, we've got, uh, a c, the CFO from pwc. Colin's been with the firm for 31 years, starting in Detroit in the audit practice back in 1994, spending time in Switzerland and spending most of his career on the deals and transaction services side of the house. Had one foot in client delivery and one foot in firm, , operations for decades. And now he's fully focused on running finance for one of the largest professional services firms, uh, in the world. What makes Colin interesting is that, he's not, your typical technology will save everything CFO, he's thinks deeply about the people side of transformation, how you build human skills in an age of ai, how you let people experiment. And innovate from the ground up and what actually matters when everyone has success to, uh, to AI tools. So, Colin, thank you so much for joining us.
[00:00:58] Colin: It's a pleasure to be here. Thank you for having [00:01:00] me. I appreciate it.
[00:01:01] Thomas: Let's start with that journey, uh, as it's been, I think, quite significant in terms of, uh, of the experience you've had over the past 31 years, starting that audit practice as mentioned. And, and kind of moving on from there, what would five-year-old think of you, uh, in the current role you have now as CFO of pwc?
[00:01:15] Colin: Uh, five-year ruled me would probably be pretty disappointed that I didn't become a pro wrestler or a pro skateboarder or BMX or something like that. But, uh, 25-year-old me is probably pretty happy where I landed. Back then I definitely had different ambitions, but yeah, it was a long journey, but I've been really fortunate.
Uh, to be at the firm 31 years, which as you know, Tom is pretty unusual in these day and age for people to stay at one organization for that long. But I've had, as you've noted, several different jobs and worked all over the place in the firm, different countries, different divisions, and different uh, different parts of the world.
So it's been a great journey. So I feel like it's been one enterprise, but probably about eight to 10 jobs over that 31 years.
[00:01:56] Thomas: I think that's what's important. It's not, you know, it's not just pwc, it's the [00:02:00] multiple roles and jobs and
kind of responsibilities. So it is a different world and I've, we've all gone through that. Right. And I even say
sometimes, even though you're staying in the same company, it's like being at a different company sometimes you gotta learn a lot of new things and, different aspects of how the business ultimately runs, which I guess is what elevated you or been helpful to elevate you to a CFO role
at the firm. , You spend a majority of your career in deals and transaction services, advising companies on m on m and a. Interesting topic, especially these days.
, That's a really specific lens on how companies reshape bus, their overall business to strategy, how they're kind of gonna unlock their value and such.
What would you consider your greatest advantage as a finance leader, given that part of your background there?
[00:02:41] Colin: Yeah. So I'd say it's, it's twofold. You're right. When you're working in m and a or deals, it is a cataclysmic moment for either the buyer or the seller, or joint venture, strategic alliance, whatever it is you're working on. So. To have the experience of coming into work for about 25 years, where every day you walked into one [00:03:00] of your client's most stressful moments, maybe they're one of the most opportunistic moments.
, So your just ability, it's a little bit of a soft spot, you know, soft skill, but your ability to keep your energy up over many, many, you know, long transactions and long deals, and just sort of see the forest for the trees, that is a huge advantage I think. , It's very rarely boring in m and a. There's always something happening and some sort of thing brewing in the background.
So that's one aspect of it. , The second bit would be, you know, we're pretty fortunate in m and a and in particular at pwc to have some incredible clients. So I've worked with our private equity clients, I've worked with our large corporate clients, acquisitions, divestitures, you name it, uh, IPOs. , And you can learn something from both sets of those constituents.
You know, they're a little bit different. Private equity is. Playing a bit more for we gotta get in, get in, get out, add value during our holding period and the financial discipline they bring to that process and being around that. And then their sticktoitiveness, their, their persistence, um, their discipline is [00:04:00] something I try to emulate all the time in my job is like, you know, well what my private equity clients do to this, because they really are working in a finite.
, Time timeframe in order to earn the return for their LPs. So there's, , that breed breeds a level of financial discipline that I thought is helpful. And also on contrast that with the other side of that pendulum, which might be corporates who are looking to buy a business that they're never going to sell.
So they're focused on 20, 25 year horizons. So at pwc we have a little bit of both. You know, in my job we certainly have short term things, we're the private equity. Kind of mindset is really helpful. And then longer term enterprise value plays where being around our largest corporate clients and what they've done has been a huge advantage.
It's a fantastic place to start a career. I learned a ton from it. , I did, as you mentioned, I did start an audit, which was also. A fantastic place to start a career just to actually learn how companies, books, and records come together before they hire you in a deal to tear it apart and, you know, tell you everything that's wrong with it and all the risk and opportunities.
So, I really did enjoy the m and a for about 20, [00:05:00] 25 years.
[00:05:00] Thomas: Yeah, the audit layer is definitely fundamental, kind of non-negotiable, right? But the other
areas in the deal side, it gives you a good, healthy blend of that kind of, uh, time horizon and value and, and the creation of the value itself. I, I, I would ask, I guess with that experience, kind of having the opportunity to kind of be exposed to many companies over that time, time horizon. What separates uh, a good company like that looks good on paper versus one that's like general, genuinely healthy, I would say, 'cause I think that isn't always the case. The correlation might, might not be
that, oh, the financials look good, so therefore it's a good company that, that, that isn't always the case.
[00:05:36] Colin: And some companies that you know, like, wow, that's a really good business model. And the company can basically run itself, but the only people who are gonna take it to the next level is the management team. So certainly when I first started in m and a, I was hyper-focused as I should be. 'cause that was my job on the numbers, like how do they all roll up?
How is this possible? How can you bridge from X to Y and Y to Z, which is still really important, the discipline that you need [00:06:00] in order to be in that profession. Over the years, I learned a lot from my clients around assessing management teams and cultures of management teams and their ability to. In particular in the case of private equity where they come in and it's, you know, you're maybe you're no longer public now, you answer to a much smaller state stakeholder group and you're moving twice as fast as you did before.
So a lot of your ability to assess the cultural dexterity of the workforce, how willing management is to change how well they work as a team, that stuff also feels kind of soft. But I'll tell you, as I spent. Much of my career, heavily focused on the numbers. When we started doing transactions for pwc, meaning we would buy companies for ourselves, where I'm more of a principal as opposed to an advisor, I really try to put a different hat on and be like, all right, look, what am I getting here?
Getting a business, but what am I getting a top that? Am I getting a management team I can believe in? , Which is super important. And that takes years to be able to really, like it is just not something you can do right outta the box. At least I don't think [00:07:00] credibly. You have to have seen a couple of really good management teams and a couple of really bad ones before you have some perspective.
[00:07:07] Thomas: calculator, right?
It's not, it's not, it's, and that's the hard part. It's hard to quantify, uh, those things ultimately, and, and in finance, right? We're, we're groomed to quantify things, right?
There's models for everything. There's calculations for valuations and stuff. And those things are, I would say, you know, those intangibles that I wouldn't call, soft is a word, right?
But they're, they're hard to quantify,
[00:07:27] Colin: Yeah, exactly.
[00:07:28] Thomas: but.
That experience. I think this is a good kind of a segue into some of the AI conversations we've had, right? Because
experience is something that kind of breeds our own logic of, of valuing those types of things, right? That we've, we've, we've groomed over years of experience and interactions and such.
I, I, I guess to start, kind of give us a high level on pwc and kind of what you guys are doing internally on the AI side to help kind of grow and, and foster, uh, your internal teams there, with this new technology.
[00:07:55] Colin: Yep. So there's, I think most large institutions. Think this way, like [00:08:00] there's certainly no regrets move of a citizen led movement where like, look, it is clear AI is probably the most impactful technology that we've seen in our lifetime, and in particular maybe in all of our lifetimes. , And the speed at which it moves and the, there's some statistics like there's 800 million people on chat GBT every day.
So it's, it is becoming quite ubiquitous. It is pretty much everywhere. So we did the first. Move, which we had done before in other technology waves, which was get it in the hands of the practitioners, which is really good for exploration. , Quick upskilling, upskilling, you know, peer to peer learning. It's not really good for scaling.
, So you can do the citizen led bit, which I think is just like 1 0 1 out of the gate. We did that. And then as things bubble up that become something we could see to be sort of commercial grade or something, we would really wanna scale across our 75,000 people and not just help us, like write an email or do something really trivial, but , something much more substantive.
We [00:09:00] established an AI factory, which sits on top. So you have the citizen lead in the middle, you have the AI factory on top and in between you have a bunch of. , You know, subject matter experts, people who are, who are super users of AI that just, just aren't the regular citizenry, but they're slightly tooled up a little bit more.
They help connect the dots and they also help surface what we think could be commercial grade ai. Something we could either commercialize to help run our firm better commercialize to help deliver for our clients better. Or commercialize to go actually consult for our clients and implement something in their business using the AI tools.
, So that's a bit how we've rolled it out. And I, I, my guess is that's reasonably similar to, to other large institutions, is my guess.
[00:09:42] Thomas: So in the organizational level, you've built like a fabric of, of an effect, right? Of, of individuals and teams that kind of hold that together from a subject matter, uh, kind of perspective. Is that
fair to say?
[00:09:51] Colin: Yeah. So it's in all 75,000 people's hands so they can access just about any LLM that they think they need to. Now, we don't literally subscribe to every one of them, but [00:10:00] all the ones you would think we ought to have for, a business like ours, we subscribe to them. They're in the hands of all 75,000 people, and then we really do.
Rely on that middle layer of, you know, AI activator, subject matter experts to tease out from the citizenry what we think we could kick up to an AI factory and really industrialize. 'cause once you're industrializing something, like you could be deploying it thousands, hundreds of thousands of times at clients and at the firm.
So there's a whole level of. Responsibility and that our firm has to put into something like that as opposed to like a one-off here or there. , But it seems, it seems to be working. We're, you know, we're building an agent workforce, , for, like I said, all three prongs at Thatto, which is help us deliver better, help us run our firm better and help us, uh, consult for our clients.
[00:10:49] Thomas: I think that's really impressive. I think it's super interesting because we're talking about the organ, the PWC organization as a whole, right? Which is there to serve a very broad, very diverse user community in a way. [00:11:00] Take a lens. I would be interested to know, like if you look at this from purely the CFO of a non big four firm, like your own, right?
That's just a manufacturing company or something like that. Do you think that's gonna like that, that kind of organization aspect? Do you think that will be something we see kind of evolve within the office of the CFO where effectively you have a
human fabric of like architects, like, let's call it, whose job is to kind of control the AI kind of technology to our compliance, to our policy, to our way of operating finances?
That's, is that something that you could kind of see kind of growing within the office of the CFO potentially down the road?
[00:11:38] Colin: Yeah. And I do, and it, it, it's interesting, the first part of that question where you said. know, what would it be like for somebody completely, you know, not in a big four setting or not in big professional services, or maybe even a smaller professional services, like you said, even a manufacturing entity.
It, it could become, and, and this is just a, an idea, which I [00:12:00] don't think is all that novel to be honest with you. Like it could become the great technical equalizer, like your ability like. I'm fortunate enough to have 75,000 people in pwc who have a wealth of experience that I can, you know, tap our systems, I can tap people down the hall, different offices, all that kind of stuff.
To the extent that gets codified and put into an LLM, it could become a great equalizer, which, which creates opportunities for everybody, I think, and potentially threats for people like me
[00:12:30] Thomas: Risk. There's a risk. There's a,
[00:12:32] Colin: It's, it's both sides of the equation, so we're. We're very cognizant of the fact that, that as these, uh, LLMs develop and as AI develops, that the technical proficiency between us and potentially anybody else is not, could, couldn't be that great, to be honest with you.
It could be solved with lms. So what does that leave? It leads the human skills, which is where we're focused, which is. Look, if everybody's got the same technical [00:13:00] chops, what is it that differentiates you in a pitch? Could it be your empathy? Could it be your persuasion? Could it be just your, you know, ethical behavior?
, Just your prioritization, uh, some of the human skills, I think where people are like, all right, look, we believe everybody's got the tech, which was never a given before, but I do believe it could head that way. And it's like, what is it that you have? For me, do you have experience, industry experience, what?
Whatever it is, it's the edge for us will definitely be human. We will equip, equip everybody with technology. , And it's easy to train people on technology. The human skills can be a little bit harder, right? That's not, not every, I think we've identified 40 really differentiating human skills that we need to focus on at pwc.
Not everybody's good at all, 40 be, but there's something to work on there. So we're very focused on making sure we don't forget. Tech as an enabler, what the differentiation will be the humans.
[00:13:56] Thomas: The humans and it's the experience. So
I do think there is like this kind of like [00:14:00] level setting that maybe AI introduces, but what actually amplifies it though is, is the experience. And I think organizations like pwc, they have in, like you just said, right? You have so many diverse and so much experience and so much documentation, right? I always tell your team, right, if I ever need to refresh myself on a SCA 15, I find the PWC handbook for it. So that
knowledge goes into the language model, right? So you guys are ultimately the memory, you know, you your memory fabric ultimately, which I think actually amplifies the, the, the what, the, what your, what your firm brings.
And I've worked closely with your, with your team, , on that side in terms of some of the stuff they're doing. It's, it is quite impressive. , And I, I think pretty, pretty, uh, pretty cool actually. , How do you keep your organization kind of continuously educated on this very, very, very quickly evolving thing that is occurring?
How do you keep them, make sure they're informed. Make sure they're educated, but also I would say make sure they're not distracted
[00:14:52] Colin: Yeah, you're, you're right, you're right about that. , Like you could experiment all day and night with AI and maybe. Learn a lot of [00:15:00] interesting things, but it's
[00:15:00] Thomas: You gotta close the book. You still gotta close the, you still gotta close the books, right?
[00:15:04] Colin: Yeah. It's like, okay, well that was, that was a fun walkabout, but we probably really need to get back to work.
, But for us, it definitely starts with setting the expectation. So. We are very explicit with our people. We expect them to use ai. We have very good statistics. You know, something like 95% of the firm has been trained up in ai and we have statistics that, you know, and that well into the eighties use it daily and more, more than once daily.
So we're, we're getting, Traction and it starts with an expectation with them, with our staff, you know, sort of a social contract. Look, look, we will get all these tools and they're not cheap, right? For any organization subscribing to these LLMs and the compute power that you can, that you can use when you, when you adopt AI can be quite substantial.
But we believe it's worth it, and we believe the expectation is that they need to stay nimble and acknowledge that they need to keep their learning journey going as well. We still have [00:16:00] that, that's like sort of the citizenry component. We still have that middle layer where those are the people who are really connecting the dots, who are on the cutting edge, who are finding the next LLM, who are being able to guide people in the field like, look, you need to use Gemini for this.
You need to use, you know, chat T for that. This LLM works for that. This one doesn't work for that. So I still think even if you equip the masses, you still need that. Uber layer of, I don't know, what is it, maybe 10% of the firm that is Super Tech enabled there that, and we adjust their responsibilities to be like, well, yes, of course you need to deliver for clients, but you also have a huge responsibility to make sure we're on the front end of the tech wave and we're not getting left behind and you're pulling our people along.
And we invest in them. you know, for some people that could be a couple year tour. For some people they've just jumped into it and said, this is my career. I want to be the translator between how we talk to our clients and the technologies we use. And I find this fascinating and we have [00:17:00] room for those people too.
So, , but it is, you're the acknowledgement that you're sort of never done. You're definitely never there. I mean, this thing is moving so incredibly quickly. It's, it's, you know. You just have to expect it.
[00:17:14] Thomas: , I had an interesting conversation related to that, , with a finance leader, uh, you know, and we were talking about education, which is, is important, right? And it will remain important. But when it comes to like AI knowledge and experience it,
it's moving so quick where, you know, we were talking about hiring and, and proximity and where place pockets are and things like that.
And it's not like, oh, go to where the best. Learning institutions are maybe, maybe it's just going to where the people are adopting it the most because sitting in the classroom and learning is great from a fundamental level, but by the time you're outta the classroom or you know, something now has changed and,, it's so, so rapidly, rapidly evolving that the classroom learning is, is kind of coming obsolete pretty, pretty quick.
Not, not discounting it, by the way,
I'm just saying you have to kind of keep it, create a. balance.
[00:17:58] Colin: I agree. It's all part of a, a, [00:18:00] a broader strategy where, we've even partnered with some of the, you know, the world's most prestigious education institutions to make sure that we can develop something that is like, you know, almost certificate like, um, for our people so that, you know, they know when they're progressing.
But you're right, the real. The real secret sauce of this is when you've got a bunch of people working together, solving a problem, using the technology like that, it's hard to replicate that any place else, and that happens in the field, and you just have to have a way to capture that, that goodness, which is not always easy in a big organization.
It can happen in a moment's notice, and then it just sort of like dissipates and nobody repeats it. And trying to make sure we have that layer in the middle that's gonna grab all that and make sure that we don't lose the goodness that happens on it. You know, something in the middle of, uh, an office somewhere like, wow, if we could do that, you know, all over, that'd be such an impactful, , advancement.
So
[00:18:52] Thomas: I would to totally agree
in, in relation to. You know, the human skills and upleveling and kind of differentiating, you're hiring, [00:19:00] right? And you're looking at resumes and you're kind of doing the interviews and you know, I guess five years ago it'd be easier than it's today because it was a little bit
more comparative of education experience and oh, you worked for that company and things like that. But now you have this other thing as a, well, I mean, how do you, what are the human skills that actually you think differentiate in a world where I and you, me and you are both equals when it relates to the language models. We have access to actually.
[00:19:22] Colin: Yeah, and I think I said this to you before, like I view AI as like one of the best first draft machines in the world. Like your ability to go from zero to a first draft. I, I remember
[00:19:33] Thomas: you started.
[00:19:34] Colin: when I was an analyst, I'd be like, oh my God, I don't, what does it look like? I don't even know how to put this together.
I, I don't have a vision for what draft one could look like. Like now, these, these LLMs you just, you crank it out. You're like, wow, this is pretty good. First draft. So what I always like tell my people, I'm like, look, and this, this would go into like interviewing as well. , Like anybody can get to the first draft.
It's the human skills of how do I make it better. , I'm big into persuasion, [00:20:00] like, can you pitch it? Because anybody can read it, but if you don't have the aptitude to be able to absorb it, regurgitate it in a human way that's not just a, a white paper. 'cause they're great white papers. They, you know, you can say, write me a strategy on professional services.
They'll write you a strategy and it'll be 12 papers. You could clip it with a thing and, and turn it into your professor. But, . The people who can internalize it, prioritize it, be persuasive with their clients, connect it, and this is gonna be a big one where they can connect it to real world experience, not just the ai.
I think we're gonna get a lot more of those questions. 'cause like everybody's gonna be an expert because they've got AI right next to 'em, so they're gonna be technically an expert if they can read and regurgitate it. It's, I think the next level order of effects where they're like, well. Okay, we gotta have you done it before.
What does it look like? What could the roadblocks be? How have you worked through, a failed implementation or [00:21:00] something like that. I think some of those real world experiences that maybe you could tease them out, if you're a really good prompt engineer, you probably could, but it, it just, it's so much more authentic when you have.
Somebody with some ex, you know, real experience on the other side. So like, as we assess talent, you know, I hadn't thought a lot about that, but that is gonna get, that is gonna get more challenging. 'cause I don't just, uh, I would love to have a bunch of prompt engineers who could extract things out of ai.
I'm still not sure they're the people who can get in front of. The CEO of a company and, and turn that AI white paper into a $25 million project where they hand over their supply chain, like, that's not insignificant. Nobody's doing that based on a white paper, you know?
[00:21:40] Thomas: But it gets you started. I think you
brought up a great point. I, I, I bring that up quite often. I, I don't know where to start. I have a lot going on in my brain, but boy, does it really help you kind of build an outline and get you kind of cogniti
tailored? I'm not, not ashamed to say it. ,
[00:21:52] Colin: You know, in certain instances you can really spend the time critical thinking about what does this mean to my client? You know, all that type of the stuff you, you always shortcut, or [00:22:00] at least I end up short cutting at the end because I'm still doing the research and the packaging.
And then you leave to the very end like, oh my God, I have to present this. Like, I have to go talk to people and get up and like real executives who are gonna have real questions. And like, you get jammed on that end. And I'm hoping. We can rebalance that and just be more prepared, more persuasive, be more thoughtful than spending so much time on draft one.
[00:22:22] Thomas: have to, yeah.
A a, absolutely. Because PWC is so, such a big organization, is doing different things every single day, , both internally and externally and, and we're talking about a very evolving kind of experience and technology. How are you guys keeping. Everyone informed of what's going on as well, because of this fabric that, I'm gonna call it, that layer that you have in terms of these, these individuals, how are you kind of feeding that back down? So everything, so the upskilling kind of continues to, to go up, I would say, uh, from the rest of the field, from the 75,000 plus people that you have there.
[00:22:54] Colin: It's funny, we just had an operating committee yesterday, which is, , so all the functional leaders of the firm as well as the line of [00:23:00] service leaders, and one of the things we talked about was how we're worried the way we communicate all the things we're doing in ai, that it just doesn't become noise.
Because it could very much be just become noise. Like if you're just telling people we, we have every, uh, model you can imagine. Go here, go there, do this, do that. It needs to be a bit more structured because nobody's gonna learn at all. , So we've developed like learning pathways, which are
[00:23:27] Thomas: It is good.
[00:23:28] Colin: specifically curated.
By our, our subject matter experts in AI to say, Hey, look, if you're a tax manager in transfer pricing, like these are the things that you forget about, that we have 90 of them, these are the seven that you need to be an expert at. And without somebody doing that, like your comment before, it just, it can just be, become exploratory, which is interesting and all very, , probably stimulating mentally, but not very productive.
So we're trying to make it not be noise, [00:24:00] even though we know we're asking our people to do a lot. So we're giving them these learning pathways that are more curated for, , in particular for what they do for the firm. And then there's other pathways that they can take if they have time and interest and want to expand their skillset.
But we do have a ba basic core curriculum around ai. And we've had this before too. It isn't just around ai. We've had, you know, learning pathways around technical training. Now it's like we gotta plug the AI in there as well. It's a legit concern that you just, you can say AI so many times.
At some point it doesn't mean anything anymore,
[00:24:30] Thomas: No.
[00:24:31] Colin: and we gotta keep, gotta keep everybody focused
on it. So I think the learning pathways are structure for us to do that.
[00:24:36] Thomas: Yeah, that's a good point. And it's a huge enabler.
And I was at a conference this week, and somebody was talking, we were talking about that it, it also risks, uh, becoming a paralyzer in a way as well, right? Because there's so many things you could go and look at and evaluate and assess in different language
models that mo are tuned in different ways that you're actually not progressing.
All you're doing is just kind of bouncing things off of these different things and you're not moving the needle forward actually. So you [00:25:00] actually risk, like you're saying, you're this role, you're focused on these things. I know there's a hundred things focus only on this, please. Right. And that's
part of leadership, I guess.
[00:25:08] Colin: yeah. You can
[00:25:09] Thomas: you're actually not paralyzing yourself.
[00:25:11] Colin: Yeah, you can get the, the, the paralysis by analysis can definitely happen. 'cause you could just keep pinging and pinging and pinging and these, these will, they'll take you down rabbit holes. Like, it just will, like,
[00:25:22] Thomas: Yeah.
[00:25:23] Colin: it's, it's meant to do that. It's meant to keep exploring, exploring, uh, so you keep asking questions, it'll take you in different directions.
And at some point, yeah, you could end up on Mars and you're like, but I wasn't going to Mars. What did I do? Uh, I gotta get
[00:25:36] Thomas: No, it's a rabbit hole. Uh, yeah.
So you're not careful.
Let's talk to like kind of maybe the more junior folks, maybe in their role or in their
careers here that are perhaps listening and, and aspiring to, to A CFO.
Ultimately, what, uh, are some key pieces of advice for those individuals kind of starting their career off analyst level perhaps, that are aiming to, to be a CFO at one point?
[00:25:56] Colin: Yeah, so, and I wouldn't say, like I came to the [00:26:00] firm saying I definitely want to be the CFO of the firm, although. Somewhere around middle of my career, I actually developed that ambition. So the first thing I would say is if you're an analyst or an associate starting a firm like ours or any other firm, , you know, you don't have to have your fifth job in mind.
Like that's a bit unrealistic. And I wouldn't put pressure on yourself to say, I wanna be the CEO or CFO, , but you should have a point of view about where you want to be every three to five years. , And I always viewed like the first 10 years of my career. , And this is after I made partner 'cause I mostly have it in, in that mindset, but was really to produce, to show the firm that it was the right decision to make me partner.
I know what I'm doing, I'm delivering for our clients. That's, that's what you would expect of me in these early years, and that's what I'm doing. Look proving production, I proving, um, that your, your company, whatever it is, made the right decision to move you forward in whatever role that is.
That's always important, and that's probably like about a decade worth of work. And then at some point you want to [00:27:00] have, like you said earlier, one foot in some form of operations and then still never, you still need to stay collected to the clients. But in the middle of your career, you're sort of like.
Two thirds clients, one third firm management. And then as you get to the end, it's probably my, my days are still probably half and half. I mean, I work a lot, so half and half is a lot, but I still spend half my time on, uh, client matters and then, you know, half my time running the firm. So I would say never get too far from the commercial side of your business, because you can only be a good CFO if you understand the commercial side of your business.
And I would say the one thing that you have to do. The whole time I talked about like, you know, working on clients and advancing your commercial aptitude and then one foot in each, and then maybe more, we're more focused on leading the firm the whole time. You have to be a leader. , And that doesn't mean you have to lead a function.
That just means you have to lead people. They have to respect you, they have to wanna work for you. You have to motivate them, you have to inspire them, you have to support [00:28:00] them. If you don't do that at any, at all, at all parts of your career. It's just, it won't be that rewarding of a career. And, and I doubt you'll get to something like the CFO 'cause you'd have to, I mean, it's just a really important part of everybody's career and not to lose, let, to lose sight of that for sure.
[00:28:17] Thomas: I, I couldn't agree more. Right. Be a leader before you're asked to be
one. I think is,
[00:28:21] Colin: And before you leave your firm, and I, I'm a big, like, I almost left PWC three times. I think that's healthy. Like I'm not one to say that you should, you should come into your firm every day with blinders on. And that goes for people in my firm. but before you leave your firm to go someplace else, you should really ask yourself like, am I happy here?
Do they respect me here? And is there more I could give to this place in a different capacity? And I bet most times for those who are listening who work in large organizations, there is that opportunity. There is now, there might not be. And then, you know, be a good citizen, move on to your new firm and, and be a proponent for your old one.
And that's [00:29:00] all fine too. Like we're, nobody's, nobody's forced to do it. But that was a bit of advice, like three times I was really close and I, you know, I had mentors and other things that, that brought me back, but I also think it's a healthy thing to do from time to time.
[00:29:15] Thomas: it is a healthy thing and you don't wanna be,
have blinders on there. There is a
big world out there, but grass isn't always greener.
, I always tell my team, if you need a new opportunity, look internally first. Right? Especially if you're good at what you do, you'll get
support for that. You know, nobody's gonna not turn you down for that. and patience is what you said as well, right?
You, you know, you, you called out like 10 years. That's gonna take you 10 years there, right? 10 years. Actually isn't that much time when
I, I think you would agree, when you look
back in 31 years to 10 years is not a lot of time. It might, you might be, you know, starting out your career and you go, oh my God, 10 years is such a long time.
It's going to go by
so fast.
[00:29:47] Colin: it does. It absolutely does.
[00:29:48] Thomas: incredible. . Let's talk about the m and a aspect. Going back to that a little bit, I,
first of all, I mean, what's your view on the market the, these days? I mean, I think 21. 2021, right. It was pretty, it was [00:30:00] insane. , Then it died down,
, Obviously, and then, and then I kind of back, I think right in, in a number of different ways.
Um, not like IPO SPAC level like it was back then, but I think
m and a is pretty active these days. Yeah.
[00:30:10] Colin: Yeah. M and a is, is active. We're seeing, um, good results coming out of our deals platform. , We're starting to see the front end of that platform pickup, which is the diligence piece of it, which is good. You're right, I mean. I doubt we'll ever see a recovery like we saw coming out of COVID. I mean, that was like, I was running our deals business at that time and I happened to be there.
At the biggest drop of that business and at the biggest incline of that business, which was a wild time to run a business. Lemme tell you, I was like, I had no idea if I was coming or going. Like, you know, we have too many people. I don't have enough people. It was wild. So I, I don't think it'll ever be like that just because that was such, such uniqueness around zero interest rate environment and people wanting to get back to living life after COVID and all that.
But it definitely is coming back. It started with the really large transactions and you can't, can hardly pick up the paper today and not [00:31:00] see a, a large, you know, mega billion dollar transaction being, being executed, and I think it is. Slowly moving into the private equity flywheel. And when that gets going pe to PE gets going, that's when the market, um, really shows its its best amount of volume.
And that is just starting right now. I mean, they're all sitting on a substantial amount of portfolio companies that they've held longer than they expected. , Valuations are healthy enough now where maybe they're not gonna get exactly the return that they had hoped. Um, but they're certainly better off to have waited.
They just need to transact. And all that's starting to pick up now.
[00:31:33] Thomas: Yeah. Valuations are still strong overall though,
but I guess when you're looking at, you know, put yourself back in your, your deals days, right. I guess.
And, and, and m and a. What, what are the things that stick out to you from a finance function that are, are red flags, uh, as you're kind of looking at an organization and an m and a level?
All
[00:31:50] Colin: Yeah. A a finance function that is overly focused on just reporting the news. Is never a good symptom. Like [00:32:00] I, I mean, if that were my job, that would be super easy. If I just had to tell the, the board and CEO and the partners of pwc like, read the network news, that'd be very easy and we have it. But the whole point of a, like a world class finance function is you're the glue between all the other functions.
So if the people function wants to do something, or even workplace services or real estate, or you name it, the one common thing all those things have in common is money. Which is the finance team. So we are the ones that literally, like if you're, if you're in an organization and you know those other functions are doing something without consulting with the finance team, you probably don't have a really strong finance team because you should be a real valuable asset to them.
, With your finance chops, your analysis chops, your understanding of the way, um, the finances come together. So I think one of the red flags is if it's just I report the news, , and not a real partner to all the functions in the business, all the commercial lines [00:33:00] in the business, uh, you know that that's a real shame when it, when it is just reporting, quite frankly.
[00:33:07] Thomas: We're doing a lot of these, uh, and have an opportunity and, and privilege to talk to a lot of people like you. But that's the one thing that every, that every single person has talked about, which is like bringing life to the data, bringing life to the numbers as a CFO. I'm not there just to tell you our growth, our margins, our ebitda, and so on, right?
Like it's telling why and the, the, the proof behind it and, and being close to your business partners that drive those numbers. Ultimately, um, is the. A very, very common theme that I've heard from all the great
CFOs that we've, we've talked to here. So I guess that that rings true. Uh,
[00:33:36] Colin: Yeah. What what's nice is like if we get a call, so the fp and a team. Is, is part of my finance team. And you know what it calls from, from business leaders who are like, say, Hey, can you do me a favor and like go do a deep dive on this business and just see if you see something I don't or I just don't understand what's going on.
Like, that's pretty rewarding for us 'cause that they, you know, we're a business partner, they value our insights. Like, I'm [00:34:00] sure that man or woman who runs that business knows it commercially better than any one of us. But we still have something to offer,
[00:34:05] Thomas: An objective I,
[00:34:06] Colin: and finance wise. So like those are, and they're, they're great projects.
It's, it's a good hallmark of a finance group where you got that kind of relationship with your lines of business and or other functions.
[00:34:17] Thomas: I think I said it on a prior podcast, uh, that we did, but yeah, our, our internally in our company, our CFO asks why all the time, , And it is just to learn, right? Like, and he, he's very cognizant of it, but
he wants to understand and learn and, what's going on behind those numbers, which is admirable for sure.
Rather than just, like you said, reporting the news. I said, it was awesome. It meant easy.
Because it is, you know, that would be, you know, if you can make, get paid a lot of money and keep your job and all you have to do is report spreadsheets, like,
I guess that's okay. Uh, but,
you know, wouldn't be as fun. I would,
I would say,
[00:34:47] Colin: that's true.
[00:34:47] Thomas: , Let's, it kind of goes back to maybe one of the things we were talking about a little bit in terms of like the future, uh, of things.
What, What,
do you predict, uh, in terms of what's coming next for the CFO role and the overall finance function, let's [00:35:00] say 10 years?
[00:35:01] Colin: Yeah, so the most overused word, definitely transformation, but I'm experiencing it myself. The early waves of transformation where you could make use of automation and you could offshore a bit and make use of lower cost countries and all that. We, we all experienced that and, and did all of that, which was the right thing for the business.
Now there's yet another wave coming of an agentic workforce and how all that's gonna work. So, I mean, I don't know how fast it's gonna move. It feels like it's moving fast, but certainly over the next decade we're gonna be grappling with. How do we manage gentech workforces and, you know, what is the right balance between that and people, um, is something that is gonna be high on the priority list, probably like we talked about a little bit, the next breed of finance professional.
, What's that gonna look like? Even curriculum wise, you know, what is the best, you know, how do you need substantially more tech background [00:36:00] in a decade now to be a finance professional? Than you do now. Don't know. Like those are things, like you said, a bunch of questions I have like, what it could look like over the next
[00:36:10] Thomas: Mm-hmm.
[00:36:11] Colin: , And I think everybody is challenged for growth. you know, , As a finance group, we gotta pay a part in that. Like, yes, we're here to run the finances of the firm, but we need to help the firm grow.
[00:36:21] Thomas: Absolutely.
[00:36:22] Colin: and and it isn't just grow profitability by being more efficient. We need to have points of view about how we actually grow the top line.
, And everybody's gonna be focused on that because there is, you know, huge swaths of work that will be probably obliterated by ai, but that means there's other opportunities for us to do things. So I think keeping in one mind or one eye on a growth mindset's gonna be incredibly important, in particular over the next decade.
[00:36:46] Thomas: , I would totally agree. I think it, it'll be really interesting to see how the, uh, the balance is shifts in terms of the overall organizations, uh, over the next 10 years in terms of that kind of legacy experience and then the new blood [00:37:00] of kind of maybe. A little more tech experience. I mean, I, I think somebody was saying, I think it's like University of Arizona or Arizona State, like they mandate that you have to, you know, you take a, you take your, you, you take your degree in something, but you also have to study ai.
I wonder if that's gonna become a norm. And I do think, you know, fundamentally. Especially in like roles like finance or something that has a little bit more of an engineering or science or mathematical, you're gonna have to have that,
but you still need to understand why. And that's my biggest concern.
I would say that people, that we make sure that people understand that I can ask a language model to help me value something, but I need to understand how valuations actually work right at
a mathematical formula level. Like I just think that has to remain. Maybe I'm a little bit too pure of that, but I definitely think that needs
[00:37:42] Colin: I just, uh, I just had dinner with a, a couple of, uh, guys who run a private equity fund. Very successful, probably five to $8 billion under management. We were, he was asking me about AI and we were just having dinner, and he said something very similar to you. He is like, I never want [00:38:00] anybody in my firm to lose their mastery.
You've been around private equity before, so you know, like when they say mastery, it's like, I don't care if you used
[00:38:08] Thomas: I don't care what you
[00:38:09] Colin: to do that. You better know every single thing about that and have an answer for every single question and know where you're going. So he is like, so they can use it.
I just demand mastery of the, of the topic, which is a little bit of like what you were just saying, Tom, where it's like you, how prepared are you?
[00:38:25] Thomas: Mm-hmm.
[00:38:26] Colin: How much have you really studied the, the stuff? You have a great first draft, but do you have mastery over that topic?
[00:38:33] Thomas: I think that's gonna, the wheat from the chaff in away is gonna kind of be
exposed, I would say, uh, over that timeline. I, I would be curious as well on that, like, when you think about the roles and the evolution of your career journey. Right. I, I guess I'll, I'll start with my point of view on this.
This concern about AI is gonna take jobs
and, and so on, right? I, I don't, I don't agree to that. I do think it shifts the, the, the responsibilities of jobs. And what I mean by that is. 10 years ago, you come out of university and you [00:39:00] start, I'm gonna come and work for you as an analyst, an entry-level analyst on your team.
For example. My goal and my role is typically what, what to probably go assess, dig out, drum up, produce reports, and give that off to my managers, right? For their, their. They're the strategic thinkers. Right? What I think is that AI kind of brings that strategic thinking line up because you're going to be using, and we're already seeing it.
AI is going to be the an is going to do a lot of the analytical work
perhaps for you to go and get you the information, but I like you keep saying, the level of strategic thinking I think just shifts up, into the organization higher, and maybe closer to the office of the CFO.
That's my prediction. Would love to your kind of point of view on that.
[00:39:38] Colin: Yeah, I, I don't disagree with that. , I think there is opportunities though, for, like an entry level person, where maybe before, like you would spend, I remember grinding through data rooms. Back when, you know, years ago, I'm even so far back, they used to be in lawyers' offices with big white binders and all that kind of stuff.
So it was really brutal. And so much of your job as an [00:40:00] analyst or an associate was, it was like 80% grind And like I said, the 20%, you're like, all right, I think I got it together and I got, now I've left 20% of the time for what is 100% of the value. I'm hoping we flip that paradigm where you're spending all that time on the really important thinking piece of it, and the grimble is done for you.
Although I do agree, you learn a lot from putting together spreadsheets. Like if you're a young accountant, you try to create a cash flow statement until you actually do it. You're like. You haven't done it. So there is a little bit. I do worry about that, that skills gap. I'm not saying you, you know, you have to have done that to be able to understand it, but boy, if you've done it, I know you understand it.
[00:40:44] Thomas: Yeah, it's
[00:40:44] Colin: So it'll be interesting to see how, how that balance plays out.
[00:40:48] Thomas: It does flip though that 80 20, I think it's a really good kind of,
that's exactly what I'm saying. I think that your, your, your expectation is a little different and I expect you now to spend more time thinking and,
[00:40:58] Colin: Positioning this, like what does [00:41:00] it, what does it mean? All right, we got all the data. It's fine. We see what the numbers say, but what does it mean? What should they do?
[00:41:05] Thomas: Yeah. I hope I
[00:41:07] Colin: level of stuff.
[00:41:08] Thomas: I do hope that still, again, going back to it, that people keep the mastery of things. You're talking to somebody who,
for fun does, you know, calculus problems on, on, on paper, still some every day just to kind of keep my mind fresh. So, , but yeah, I hope that, you know, we still keep some of those core things
and understanding of how, how these things work ultimately. . This is great Colin. , It would love to know a little bit more about you, uh, in terms of kind of
what you do when you're not in the office, right? I always say, you know, I always ask, you're not a CFO all the time. I always get corrected 'cause you are A CFO all the time, right? Uh, and, and that is fair. So what do you do to decompress outside of work?
[00:41:43] Colin: I watch a lot of sports and I do find it that this will find a way sports and cooking shows, and somehow I've turned these competition cooking shows into like a sport.
[00:41:53] Thomas: I love
[00:41:53] Colin: I can't explain it, but I find it very relaxing to sit there and watch Pete, Bobby Flay. I don't know why, but I do.
As much as I [00:42:00] enjoy watching the Knicks or the University of Michigan, any sport that they're in, , but literally those three things, the. The Knicks, university of Michigan and, and cooking shows. I, I don't know how I adopted that. It's very weird. My
[00:42:10] Thomas: Yeah. cause
[00:42:11] Colin: too, so it's okay.
[00:42:13] Thomas: I can resonate, man. I love, I love the cooking shows. I love Chopped. , But you're a Michigan guy. You a Lions
[00:42:17] Colin: Yeah. , I am, the only New York team I picked up was the Knicks, and that's because a couple of Michigan players went through there. And
[00:42:24] Thomas: Yeah, they did. Yeah.
[00:42:25] Colin: if you're ever in New York, they can't stop talking about the Knicks. So literally if you can't beat 'em, join 'em. So,
[00:42:29] Thomas: I know, I know, I
[00:42:30] Colin: but still a Lions fan. Yes. Yeah.
[00:42:32] Thomas: I'm a Philly guy, so we'll leave it at
that, I guess. Uh,
[00:42:35] Colin: Congratulations.
You just beat us.
[00:42:37] Thomas: That was a tough one.
, I'm a big traveler. You spend time
in Switzerland, favorite city, uh, that you, you know, your favorite city in the world also.
What's your favorite place to eat in that city? If, if you can.
[00:42:47] Colin: Yeah, so. My favorite place to eat is the Coney Island in Detroit. So I'm not showing a lot of worldliness here, but that
[00:42:54] Thomas: It's
[00:42:55] Colin: Um, but I did love living in Zurich. It was incredible. [00:43:00] And, I actually love the city of Zurich. They served up these great, I'm really making myself sound pretty pedestrian here.
I used to eat these sausages in, in the train station, these server alos they used to call them. And they were just incredible. You get that with a piece of bread and I was like. This is perfect. This is great. We get on the train and I would just go back to, , go back to the house in Hurley Burg, Switzerland, which was just outside of Zurich.
And,, was great, but I, I really did love it. Like that was a, that was a fun time in my
life. I wish I could have stayed there longer, but it, I just needed to get back for career reasons. But I really did enjoy it and I would encourage anybody who has a firm where they'll, they'll provide you an opportunity to do that, to definitely take
[00:43:39] Thomas: Do it.
I, I completely agree. And,
[00:43:42] Colin: For me, it was the proving that I could be successful doing an m and a job where I couldn't read or speak the language. Now, of course, it's Switzerland. Almost everyone speaks English, so I'm not patting myself in the back. But you, you, I couldn't read. Hundreds of pages of documents I had to be [00:44:00] successful, like talking to teammates and, and reading, reading what they would produce and making sure without being able to get into the detail, um, making sure I was, you know, covering things off.
So it was, it a huge professional leap for me. And on top of just a personal leap of being in another country and experiencing something with your family that is pretty unique and cool.
[00:44:21] Thomas: And you look at things differently, right? Because it ultimately, we all are different, , in some ways, but we're also very much the same. But you kind of see how, you know, op operations are different and how organizations work and so on. I think it's, I, I agree. If you have the opportunity, it doesn't matter where,
take it.
[00:44:35] Colin: I agree.
[00:44:36] Thomas: know, I would say. And last thing, I always
like to ask, um, books, uh, anything, anything recently that you've read or are reading that you would recommend to the audience? Here?
[00:44:44] Colin: So I fi finished reading a book of, oddly by Bo Schembechler, which was about leadership, which was great because it was you. You read a lot of technical books and I've read, you know, a lot of technical books on AI and things like that, and I find them interesting. , But I feel [00:45:00] like I'm playing catch up on a lot of that stuff, just trying to make sure I'm current.
But I read some, you know, I read this book by Boche Blacker, just like leadership lessons in life. And even though it's talking about a football team, he talks about like having a process and you know, knowing your strengths and know your we weaknesses and being disciplined and all those things that sometimes you need a reminder 'cause you can get lost in a bunch of technical.
Mumbo jumbo where you're like, I'm losing the forest for the trees here. I'm, I have to lead these people and inspire them. And, , that's a big part of the job in particular, like if you're the CFO or something like that. , So that was good. And now I'm reading a book by Andre Agassi.
[00:45:39] Thomas: Oh, is it his, \, biography?
Yeah, Yeah. It's very good. Very, very good. Um, very
[00:45:44] Colin: just started, I actually met him at, uh, Wimbledon,
[00:45:47] Thomas: Did you
[00:45:48] Colin: uh, yeah. Which was really fun. And, uh, then I went on and got his book. So it was cool.
So I'm just starting it, so
[00:45:54] Thomas: The leadership book's great. I think that's universal, right? Leadership. I think it, it sustains, I, I, uh, I can resonate with that and [00:46:00] Beau I think it's one of those characters. It doesn't matter if you're not a U of M fan.
Everybody loved, I think everybody has so much respect for Beau. So, uh, very cool.
And Colin, thank you so much for being here. , And thanks for tuning in, folks to never miss an episode, subscribe wherever you listen. I'm Tom Gavigan and this is Liquid How CFOs Outperform.