Leaders of Modern Finance Ep. 12 – The CAO/CFO Relationship ft. Christina Liu
On this episode of the Leaders of Modern Finance podcast, host Tiffaney Fox Quintana welcomes Christina Liu, CAO at Confluent, which offers a cloud-native platform for data in motion.
Scientific Beginnings
Christina grew up in China, earning a bachelor of science degree in chemistry from Tsinghua University in Beijing. At the urging of her parents, she came to the US to further her education in science, specifically in biochemistry, at the University of Delaware.
She realized six months in that she wasn’t excited about making science her life’s work. She decided to pursue accounting and got her master’s degree in accounting from Washington State University.
Christina sees similarities between accounting and science and feels that her science background has helped her accounting and finance career. She points out that both disciplines require development of hypotheses and making decisions based on incomplete information. Her science background allows her to live with having incomplete data in accounting without stress.
Getting Started as a CPA
Christina’s first job out of college was as a CPA at a boutique firm in Portland, Oregon. She did tax returns and audits, typical CPA stuff, and she enjoyed meeting individual clients and hearing their stories. But she had bigger dreams and after a couple of years, it was time to move on. She applied for and landed a job as a consultant at KPMG in the Bay Area.
Christina stayed at KPMG for nearly ten years, working on the audit side. She worked exclusively with tech companies of various sizes and in different stages of funding, from pre-revenue startups to large, established companies. It provided great insight into how the different stages of companies operate, and she learned a lot about the whole lifecycle from startup to IPO and beyond.
Her time spent with Silicon Valley firms came during the interesting transition from perpetual software licensing to a SaaS model. During this change, investors needed a lot of education and Christina had a comprehensive understanding of how the process worked from a financial perspective. This exposure to a variety of different revenue models would help shape her career.
Rise of the CAO
Both Tiffaney and Christina have seen an elevation in recent years in the importance of chief accounting officers. Christina says that it can be traced back to the evolving role of the CFO.
CFOs have traditionally been guardians of the financial side of the business. The CFO made sure the operations were in compliance, and they would take part in annual financial planning.
Today, in many organizations, the CFO role is much more of a business leadership one. Gone are the days when the CFO looks back to the past on operations. The CFO today concentrates on the future, driving conversations and decisions based on data. It’s much more of a strategic role that relies on foresight to guide the company toward maximum growth.
The growth of the CFO role has led directly to the rise of the CAO role. Those functions the CFO used to handle didn’t go away, and the CAO now steps in to make sure the compliance side of the house is in order and provide leadership from the executive level on that side of the business.
This is especially critical during high-growth phases of a business when someone has to make sure the company stays on track from an accounting and operations perspective. Christina finds herself constantly projecting 12 to 18 months into the future to make sure her side of the house is in order and staying on the right strategic and operational track.
The CAO/CFO Relationship
Christina believes the relationship between the CAO and the CFO is a critical one. She works as a partner with the CFO, ensuring that the operational side of the business is running smoothly, including AP and payroll. She calls these functions “keeping the lights on” and she makes sure the CFO doesn’t have to worry about ending up in the dark.
Christina also works closely with the CFO to support strategic projects of the company, which are going through rapid changes. One of those changes is international expansion. She works on the necessary transformations of business models, including new product packaging and pricing for a global market.
She has to look at the whole competitive landscape and how it is impacting their business model. If there are impacts on the accounting side of the house, she needs to be ready to respond to questions from the CFO in real-time so strategic decisions can be made based on current data and information.
Striking a Balance During Growth
Christina’s career has put her in a variety of situations, from late-stage startups to companies going through an IPO and beyond. She admits that it can be tricky when a company has a 10x increase in revenue to keep everything in balance. When going through high growth, it can be difficult to know whether to make decisions for today, five years from now, or ten years down the road.
As a leader, it is hard enough to keep pace with such rapid growth in and of itself, but Christina also has the responsibility of leading her team through it with her. She thinks it is vital to be an inspirational leader to her team members and always show up in the right way in front of them.
There are some long days in high-growth phases, and she is mindful that as a leader, she has to keep her energy up for the sake of her team, despite the fact that she may be exhausted. As she says, she and her team all chose to be part of a high-growth company. They are all there for the excitement, the incredible opportunities, and the learning curve.
Sometimes it can be difficult. But that is what they signed up for.
This episode is brought to you by Stampli. The Most Powerful Way to Process & Pay Invoices. Stampli is the only AP Automation software that centers communications on top of the invoice so that accounts payable collaborates better with approvers, vendors, and anyone involved with purchases to quickly resolve issues and questions, resulting in 5x faster approvals.
Want to check out more episodes? Follow our podcast on YouTube, Apple Podcast, or Spotify!
