The way that Dan Murphy sees it, the CFO position demands that leaders always be kept on high alert. This is a mindset that has led him to habitually monitor updates and alerts related to key vendors, including banking institutions. And so it was, in first quarter of 2023, that he spotted a vague tweet hinting at possible financial instability at Silicon Valley Bank.
Read MoreDespite the tweet’s uncertain implications, Murphy at once became reminded of the risks inherent in relying solely on one bank. He proposed to his company’s management a dramatic strategic move: Diversify the company’s financial reserves by transferring a substantial amount of its assets to JPMorgan as a precautionary step. His decision was based not on confirmed financial trouble at Silicon Valley Bank but instead on a principle of risk management that favors caution in the face of potential financial upheaval.
The board approved his recommendation and the funds were shifted in time, thereby safeguarding his company from the financial disruption that followed when Silicon Valley Bank’s challenges became widely known. This proactive maneuver not only protected the company from immediate financial jeopardy but also served as a poignant lesson in corporate finance: Be prepared for the unexpected by diversifying risk.
Dan Murphy’s quick response to a simple social media indicator is a testament to the vigilance required in the role of a CFO—particularly within the volatile environment of tech start-ups. The action that he took while CFO of tech company Unqork reinforced the essential finance strategy of having multiple banking relationships, a practice that Murphy feels he has always championed—and always found to have proven its worth at moments of unforeseen challenge.
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CFOTL: Tell us about Commercetools … what does this company do, and what are its offerings today?
Murphy: Commercetools is the leading composable e-commerce platform that selling to enterprise-level customers. We solve complex problems for them by allowing them to focus on how they want to engage their consumers—instead of them having to worry about how they’re going to manage this technology, run it, and get it out. We can be highly customized, or we can be set up in in a pre-opinionated structure that enables you to go live relatively quickly.
Read MoreIf you think that you require something more complex, then you can customize us as much as you want, leveraging are close to 350 different APIs. We go to where the consumer is. We can build to any platform and space, whether it’s across mobile, Web, social, or any device that you’re talking about. We solve issues related to scalability, reliability, and flexibility. In short, Commercetools has done a great job of really just focusing on the market, as we solve clients’ problems. We go up against the monolith legacy providers by providing a fully customizable solution for our end-users.
Going forward, it’s heads down and execution. We had a great 2023, and we’re gearing up for an even better 2024. We need to make sure that we have the organization structured in a way that will help us to continue to grow in the best way possible. We need to make sure that we’re acquiring the right customers through the front door. And then there’s what I call “plumbing”: making sure that the back office is ready for whatever our next step is, whether it’s an IPO or whatever. We need to make sure that we’re putting the right underpinnings in place, without squeezing the organization too high, too tight.
jb
“Get out of your comfort zone and volunteer for additional opportunities. Know your strengths and weaknesses and be honest with yourself. Spend time networking in and out of finance circles. Learn from those around you and adopt what works for you.” –Dan Murphy, CFO, Commercetools
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