Interview with Accountant Shawn Rea
Shawn Rea is a Chartered Accountant and a member of the Association of International Accountants practicing in London. He specialises in Virtual CFO services.
- Part 1: Presentation
- Part 2: Description of your career
- Part 3: Job and goals
- Part 4: Qualities/Skills
- Part 5: Personal
Part 1: Presentation
Hi, I’m Shawn, I’m 48 and I’m a Chartered Accountant by training, having trained with one of the Big 4 Accounting practices PwC in Johannesburg South Africa 22 years ago. I have previously worked as a CFO in the City banks and Financial institutions. Most recently, I am a consultant working for my own registered consultancy/accountancy firm public practice in which I provide virtual CFO services.
Part 2: Description of your career
What drove you into Finance?
I was always good with accountancy, probably because I liked to categorize all my work. My parents wanted me to be a lawyer, but I decided to transition from law at university to focus on business and accounting which suited me better.
Where did you get started?
I qualified at PwC in Johannesburg and completed my 3 years of training with them. Having earned my qualifications, I moved to London shortly thereafter.
Part 3: Job and goals
Introduce us to your profession and your company
I’m a South African Qualified Chartered Accountant and also a member of the Association of International Accountants practicing in London. I’m aiming to have additional rights to take on European clients thanks to the AIA’s global footprint and support.
I started my company, Financial Technology Consulting, in early 2019 with a vision to help people solve problems in larger organisations. Private Equity houses and PLCs were typically my clients and I have helped some big names to grow, raise funding, and solve several transformational problems.
I’m lucky as I seem to have an innate ability to spot issues and fix problems. I wanted to focus on helping scale-ups grow efficiently and so I have called my practice The Fintech CFO, as I have historically worked in Financial Services and more recently Tech start-ups in Fintech. Although any business that is scaling, I can help.
I like to say I Build – Grow – Change scale-ups.
I have a strong Regulatory & Compliance background as an ex-banker and this is specifically helpful to tech and Fintech businesses. I'm also a Non-executive Director and Advisor to other businesses.
Reading a little into your LinkedIn, we noticed the scary statistic that 90% of scale-ups fail. Can you help us break down why the failure rate is so high?
- In 2019, the failure rate of scale-ups was around 90%.
- The research concludes 21.5% fail in the first year, 30% in the second year, 50% in the fifth year, and 70% in their 10th year
- 2,280 hours wasted per scale-up, per year
How does one choose an outsourced Finance Director (FD)?
In terms of choosing an outsourced FD, there’s no one size fits all, but there are a number of stages in a company’s evolution where there’s a need for particular financial skills. If these skills are not available within the company’s own finance team, then it’s time to look for external help.
What impact can Virtual CFOs have on the profitability of a business?
Choosing a Virtual FD/CFO when scaling a business in year 2-4 of its journey makes sense as comes at a fraction of the cost of a permanent hire or Big 10 consulting firm. Often you need these skills at the following times:
- You need to grow: Financial modelling, business plans, pitch decks, investor relations, EIS/SEIS
- You have a problem: Across a range of issues an FD can help
- You’re scaling: Full range of services to support growth
- Your growth has stalled: Full range of services to develop and implement strategy
- You need to build to scale: Develop management reporting, mentor Finance team, systems implementation
- You have an opportunity: Investment appraisal, due diligence, M&A
- You want to exit: Develop and implement a strategy to maximise the value of the company
Most scale-ups I have worked with need help at the beginning and in the middle of their journeys for different reasons.
In the beginning, to set the governance and legal framework and set a 5-year plan.
Those needing to guide the Founders through various stages of growth past £1m of revenue are also critical.
Can you describe the biggest difference in challenges for start-ups vs scale-ups when it comes to their finances?
- Raising Finance is always the biggest problem, how much, when, from whom, and what type of financing can have a huge impact on the future.
- Knowing how fast or slow to push the business in the scaling years often can kill or boost a start-up
- What culture do you create?
- What is the product set and route to market? Do you have the customer in mind?
- What technology are you implementing today and is it correct/adaptable for tomorrow?
Part 4: Qualities/Skills
What do you think your clients are looking for when they hire you?
A clear communicator who can focus on the immediate problem and deliver that, but more importantly, to give value added by having a holistic view of the strategy of the business. A ying to the Founders’ yang.
Someone who is both practical and direct, but also adaptable to circumstances and timing.
What’s in your skillset that can help a business?
- The big view of a business and sector.
- Value-added commentator and direction.
- Asking difficult questions whilst making sure I am guiding/helping all the time. I have seen too many start-ups lack direction because no one asked them why they were not pivoting.
- Problem-solving, be it a fundraiser or a transaction, or a general change.
- Thinking about the exit or sale for the business at the beginning of the journey.
Part 5: Personal
Hobbies: Reading fiction & writing short stories.
Favourite things to do: Foodie & theatre, swimming
Free time: Spending time with my dogs and family and my husband; going out with friends
Hidden talents: Voice for radio and secret radio presenter/journalist.