I recently co-presented a webinar about financial storytelling to HR and Ops leaders, hosted by StartupExperts. 26+ people attended, and 8 people filled out the rating survey! We got a a 39/40 (all but one person gave us 5/5). I'm adapting a portion of the slide deck into written format for today's newsletter (and may bring the rest in the future). Enjoy!
Deep Dive on Financial Storytelling
Leaders are in the influence game. You may be influencing your team on a new org. design. Or your peers to support an initiative. But very often you’re trying to influence your own leaders to approve resources or a strategy you’ve mapped out.
How do you go into the room with the C-suite and get a yes?
Today let’s focus on a financial discussion. How do we get the CFO to say yes?
The framing I want you to have is that you’re not a supplicant begging for resources. You’re a business peer making effective business decisions.
Your reputation matters as much as the math
Every budget or financial approval meeting has two evaluations running in parallel.
The first is the one you’re aware of: is this idea sound? Are the numbers right? Does it tie to the strategy? Is the payback reasonable?
The second one is hidden, and can often be more important: how confident is the CFO that you can deliver on what you’re proposing? If they give you a budget and it doesn’t produce outcomes, how exposed are they?
That second evaluation explains situations when a lesser idea gets funded. It’s not that the CFO disliked the idea. It’s that they didn’t trust that you could deliver the outcome you claimed. A “worse” solution from a trusted operator often beats a bigger outcome coming from someone they have low confidence in.
The CFO’s reputation is on the line with yours. They’re not just betting on the idea in a vacuum. They’re betting on you being able to execute on it and delivering the stated benefits, within the stated time. And if they’re not sure about you, they may take the smaller, surer thing.
People often miss this second evaluation track because they think it’s all about the ideas and the numbers. If the math maths, what is there to even talk about?
The math isn't just math, and it's not just an idea. Your reputation on execution is part of the evaluation as well.
How to perform in the room
If the second evaluation is about you, the obvious question is: how do you put your best foot forward?
Keep these three things in mind:
- Understand the problem deeply
- Show tradeoffs
- Be honest
Depth.
There are no shortcuts, and there’s nowhere to hide. Do you understand this idea and your business, or do you not?
The CFO and other senior leaders are going to probe. It helps them understand the problem so they can make an effective decision, and it helps them understand your level of knowledge on the subject.
The CFO can probably find a gap in your thinking because you can’t have explored, tested, and analyzed everything - but what matters is how deep they probed to find the gap.
If you get a deer in the headlights look because you don’t know something, was the question “Why does this cost $500K?” or “What's the weakest day of demand for coffee beans in farmer's markets in Texas when the local football team last the Friday before?” You better know the former. It’s probably okay to get back to them on the latter.
Tradeoff fluency.
Nothing is perfect. Every real idea has costs, risks, tradeoffs, and dependencies. If your proposal doesn’t bring them up, you sound like you don’t see them. If you don’t see them, you can’t manage them.
Do you know what happens in different scenarios? What if you go harder in one area versus another? What if you fund more of these roles versus those? What if you launched this month versus that month?
You should know some of the key tradeoffs to convey to the CFO that you’ve considered a variety of options, understand the implications, and feel like your proposal represents the optimal path.
Honesty about what you don’t know.
Sometimes the CFO asks something you can’t answer. The instinct is to fill the air with words and hope you sound smart. Don’t.
“I’ll get back to you in 24 hours” is a valid answer. Bluffing is a credibility-destroyer, and it'll be obvious to the senior leaders in the room.
A friend of mine tells the story of his first big board meeting. The board asked him about NRR and GRR, net and gross recurring revenue, classic health metrics for a SaaS business. He didn’t have the numbers in front of him. He tried to answer anyway. He says it took the better part of a decade to fully rebuild that credibility. That seems unfair, but it’s real. Trust matters, so protect it by being honest.
Yes, this has tension with what I said about how you need to have depth. Yes, your goal is to understand the problem much as you can, but if you don’t, be honest about it.
Synthesis and maturity with metrics
In the nuts and bolts of preparing for the CFO meeting, there are three things you should do: synthesize, convey the causal pathway, and avoid false precision.
I’ve written before about synthesis versus summary - the difference between handing your audience a pile of facts and handing them the implications. Here, that means showing outcomes, not activities.
Nobody cares that you’re “going to implement a new applicant tracking system and retrain the team.” The CFO will be wondering; what happens because you did that?
Instead you want to say something like “time-to-hire drops from 47 days to 28, which unlocks $800K of revenue currently locked behind open roles.” Activity language signals you’re operating in your functional silo. Outcome language signals you’re operating in the business.
The CFO wants to understand how top level financial metrics are affected by your work. You might care about employee sentiment, but why should they?
I like to use something I call the causal pathway; like how one domino falling causes another to fall, causing another to fall, etc. There’s a chain of cause and effect from something that matters to you to something that matters to them.
You need to build and show that causal pathway for them. Employee sentiment isn’t the point. But employee sentiment causes attrition, which lowers team velocity, which lowers revenue per FTE.
The basic understanding of how things move relative to each other is the starting point (e.g. this goes up and that goes down), but higher maturity requires putting some numbers on that. With experience and experimentation, you want to be able to say “A 10 point drop in employee sentiment tends to drive a 5 point increase in attrition three months from now.” That’s how you go from vibes to math.
Lastly, make sure you’re presenting ranges instead of point estimates. I’ve had people come to me with seven decimal points of precision because an analyst ran some math and gave it to them. The future is uncertain, so don’t pretend like it’s not by being over-precise in your predictions.
Give scenarios, like base, upside, downside. Or a confidence interval. “We’re 90% confident the result will be an increase of between 15% and 35%” is what an operator sounds like.
Bringing it all together
The CFO is evaluating the math…and you. People who consistently get to yes have done the work on both sides.
On the math side, they’ve done the synthesis. They lead with outcomes, not activities. They’ve drawn the causal pathway from their work to the metrics the CFO actually cares about. They present uncertainty honestly, in ranges and scenarios rather than false precision.
On the "you" side, they have the depth. They know their business well enough to handle the probe. They name the tradeoffs themselves before the CFO does. They say “I’ll get back to you” when they don't know the answer.
That’s what a peer looks like in the room. It's how you become someone the CFO trusts to make a business decision and deliver results.
Call to Action
If you’re not getting approval for something you want to do, use today’s newsletter as a diagnostic.
Is it the idea itself, or your reputation as someone who could deliver it? How well do you understand depth, tradeoff fluency, and honesty? How clear are you on the causal pathway?
Finance isn’t a gatekeeping function. It’s a tool. Peers who learn to wield it stop having budget conversations that feel like trials and start having ones that feel like decisions made together.
Kevin
