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Among the different experiences that Alan George credits with having prepared him for a CFO role, one office meeting looms large.
After he had spent days and nights preparing his first presentation for the president of a portfolio company, George recalls, the meeting came to an abrupt end when the executive reached across the table and shut George’s laptop.
“Come with me!” was the curt command he recalls being issued as he followed the executive out of the office. Over the next few days, George says, he toured the company’s manufacturing facility alongside the executive and went on visits to different suppliers.
“We were literally riding on delivery trucks and talking to retailers, and he took me through the entire life cycle of the product,” says George, who credits the excursions with illuminating the realities of the business and delivering a lesson that to this day informs his decision-making.
Of course, the experience that truly sets George apart from those of most of our CFO guests is one that happened at midstream in his career, when—after having spent a number of years at JP Morgan as an investment analyst and ridden inside delivery trucks as a private equity executive—he exited the business world and joined the U.S. military.
“I usually tell people that I took a five-year sabbatical,” says George, who, after completing basic and airborne training, was selected as a Green Beret and assigned to a team within U.S. special forces with which he remained engaged for three years. “I was obviously older than most people, and I think that if I had waited three more months, I would have been over the age limit,” explains George, who adds that a desire to serve in the military first took root while he was working at JP Morgan in New York in the months after 9/11. Six years later, his plans took flight. –Jack Sweeney
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Guest: Alan George
Company: Ojai Energetics
Connect: www.ojaienergetics.com
Headquarters: Ojai, CA
CFOTL: Tell us about your top of mind metrics and numbers?
George: The first thing that I look at is daily sales. I get a report that comes out in the middle of the night. I know what we did in sales the day before, and then I can drill down into it and say, OK, since I’m primarily a direct-to-consumer business, I want to see my traffic conversion and AOV. I want to see how we’re doing relative to our forecast. I want to see how any specific programs are driving those key metrics. For us, specifically, traffic is a huge driver. We have really strong conversion and AOV. Traffic-driving awareness programs have a huge impact for our business. When we’re looking at where we’re spending marginal dollars, the ROI of driving traffic to our site today is really high, so the couple of betas that we’ve done to drive traffic have been really, really meaningful for us.
The other thing that I look at is repeat purchase rate. I think that this is an indicator of the health of your product portfolio and the quality of the products that you’re delivering. I tell everybody that it’s easy to get that first sale. It’s really hard to get that second and almost impossible to get the third. So, how do we be the best at this? By getting our consumers to buy into what we’re doing and continue to purchase. These are the major things that we look at today.
When I came in, I revamped the forecasting model. The team had done a good job with the limited resources that they had in putting together a forecast to try to stay ahead of growth and be able to manage inventory and cash properly. When I came in, I tweaked the process. The biggest thing was instituting a weekly direct cash flow model. As an early-stage company, cash is the most important thing for us. We’re in the middle of a fund-raising round, so being able to manage my cash flow on a weekly basis until we get that round closed is critically important. This is something that I do and look at every day—tweaking the forecast based on what I’m seeing and being able to make sure that I have visibility into what the cash flow will be for the next 13 to 26 weeks.
