Back in 2015, when Gary Swidler was a candidate for a CFO position at Match Group, the seasoned banking executive recalls being told by company management: “On paper, you are definitely not the most qualified person for the job.”
The gap on Swidler’s resume was due to the fact that he had never held a CFO position—a void that frustrates many first-time CFO candidates who routinely find themselves second in line to candidates whose resumes list previous CFO appointments.Read More
Perhaps frustrated CFO candidates might find some comfort in the notion that Match, a company whose online offerings excel at achieving “matches”—albeit romantic ones—chose to discard industry’s traditional CFO matching criteria.
According to Swidler, the CEO remarked: “You’ve never done this before, but I’ve known you for a long time and you have very good judgment. You’re a smart person with high integrity, so don’t prove me wrong.”
Swidler’s comments expose the roles that intuition and instincts often play when it comes to CFO hiring. They also draw our attention to the type of partner that Match management was seeking: not a blind follower or “yes man,” but someone upon whose counsel the CEO and a board could rely.
Meanwhile, as a banker, Swidler’s relationship with his future company had gone back not months but years, giving him an edge over veteran CFOs who were less familiar with Match as well as IAC, the holding company that at the time owned 100 percent of the online dating company.
However, within 2 months of Swidler’s arrival in Match’s CFO office, IAC sold 15 percent of its shares to the public, allowing Match to raise a little more than $400 million and giving the company a market cap of around $3 billion.
In the coming months and years, more IAC shares were expected to be sold to the public, which would allow Match Group to becoming increasingly unfettered from its largest investor.
Be that as it may, IAC was evidently not yet ready to part with its 85 percent and opted to hold on to its shares until June 2020, when it completed a spinoff of Match Group by selling its shares to IAC’s existing shareholders and thereby giving Match a market cap of $30 billion.
“We had such a good business, and we were doing so well—IAC enjoyed owning us and didn’t want to give us up,” says Swidler, who would likely not hesitate to tell us that when it comes to large investors, breaking up is hard to do. –Jack Sweeney
CFOTL: Tell us how you view the CFO role today and what’s changed about it over time …
Swidler: The CFO job has actually evolved quite a bit over the past 10 to 15 years. It’s gotten more complicated. There’s more to manage. In the old days, you were either someone who dealt with investors and some strategic things or you were more of an accounting type and you oversaw the books, so to speak. Now you’re much more of a “business judgment executive,” if I can use that term. You’re called upon to make business decisions.
The role is fairly complicated, and I think that different kinds of people can fit into it. Obviously, the best predictor of whether you’re going to be good at the role today is whether you were good at it yesterday at some other company. This is why people recruit similar types.Read More
I would actually argue—and I’ve thought about this some—that there are a lot of different people out there who are suited for the role. If you have good judgment and can think through issues and kind of balance out risks and rewards—which is not so easy to do—this is the best predictor of whether you’re going to be good at this role. Accounting or tax expertise in particular is not going to help you all that much. Dealing with investors and capital markets is all learnable, but judgment and how to think through issues and make decisions is the real currency of the job.
Companies in general have gotten more complicated to run. The expectations have gotten higher. Things move more quickly. You do have more information at your fingertips, but you don’t have that much time to make decisions on it. I also think that the CEO is looking for a partner. Running a company is a very challenging thing to do as a CEO, and the best thing to do is to have somebody by your side who can help you to make these decisions, because they are usually challenging ones.
Over time, the CFO role has morphed into being a little bit more of a partner to the CEO on all of the things with which they need to grapple. During the past 4 years in which I’ve been here, we’ve always had a little bit of a division of labor among the CEO and the president and me. We divide and conquer different aspects of the job, and then when things are more complicated than one of us can handle on our own, we get together and try to put our brains together and figure out what to do and how to handle it. This system has worked pretty well for us. You can’t do everything together because you wouldn’t be able to move fast enough. But if you have different skills and divide and conquer the pieces that are out there and then you come together on the hard, big things and make decisions together, this seems to be a pretty good recipe. It certainly has worked well for us.
VALUE QUOTE: “If you have good judgment and can think through issues and kind of balance out risks and rewards—which is not so easy to do—this is the best predictor of whether you’re going to be good at this role.” jb