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The CFO Playbook

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The CFO Playbook

Tips for success in any economic climate

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  • The huddle
  • Creating a resilient company
  • Driving a culture of smart spending
  • Playing to win in any market
  • Key takeaways
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The huddle

As companies brace for uncertain macroeconomic headwinds, many pundits are preaching prudence and austerity. On the surface, it's sound advice.

However, top CFOs say this climate calls for something more nuanced — a world where companies can strike the right balance between financial discipline and growth.

After years of near-zero interest rates, companies are facing leaner times and asking employees to spend wisely with a focus on profitability. This marks a major change, and leading that shift in strategy and mindset is a role that’s tailor-made for CFOs.

We asked leading CFOs on the frontlines for their insights on how to navigate changing market conditions. While no single playbook will work for every company, we believe these insights can provide guideposts for CFOs to win in every economic climate.

“You still have to play to win — and win big.”

— Lee Kirkpatrick, former CFO of Twilio

Chapter one

Creating a resilient company.

Across industries, financial leaders remain focused on long-term opportunities while keeping a sharp eye on risk factors. We spoke with three CFOs — John McDonnell of Evive, Kurt Boehringer of Derivative Path, and Michael Tannenbaum of Brex — about how they are striving to run efficient operations while keeping their companies on a growth path.

1. Make scenario planning a centerpiece of your strategy.

One of the lessons that John McDonnell, CFO of Evive, learned during previous downturns is that with good planning, companies can often maintain growth and come out stronger once the economy rebounds.

“Most of the time, when you run into one of these cycles, you underestimate the revenue impact that you might experience, and you overestimate your ability to respond to it on the cost side,” McDonnell says. “As a finance leader, you have to force your teams to run through a couple of scenarios.”


At Evive, an HR tech platform that simplifies company benefits to boost employee engagement, McDonnell has made scenario planning a centerpiece of its strategy, allowing the company to amass a two-year runway, identify investment opportunities, and shift resources to areas that can stimulate growth.

One thing McDonnell can’t totally control? Customers. While Evive prides itself on strong relationships, even happy customers may resort to cancellations if they’re forced to cut costs in a downturn. So McDonnell stays prepared for a range of outcomes by emphasizing financial discipline and scenario planning.

McDonnell also looks at available benchmarks of Evive’s peers to see whether the company had overinvested in any areas during the bull run. “Those should be the areas where you begin to taper back,” he says. “Then, you can start with hiring freezes to avoid a staff reduction.”

Along with those measures, McDonnell has placed a stronger focus on monthly reviews of financial accounting and reconciliation of records. That extra vigilance can ensure that the company is tracking according to plan and help avoid miscommunications that can arise with a distributed workforce.

McDonnell says that as the economic uncertainty continues, Evive will continue to plan strategically with a base case, best case, and worst case. And, as the company meets revenue goals, McDonnell will move to invest more in future growth. “Sitting on some costs may slow down your innovation, but you can always accelerate the product roadmap,” McDonnell says.

“As a finance leader, you have to force your teams to run through a couple of scenarios.”

— John McDonnell, CFO of Evive

2. Require employees to justify spending.

With financial discipline at the company’s core, Derivative Path CFO Kurt Boehringer has helped to establish a culture of making a business case for every spend.

“We task all employees — regardless of function — with justifying spend through ROI,” Boehringer says. “Whether it’s hiring a new salesperson or spending money on R&D, we want them to think as if they’re investing that dollar. From there, they pitch us on what that dollar spent will do, relative to the other dollars spent,” he says.

That discipline has come in handy as Derivative Path contends with changing market conditions. Through extensive training on the company’s financials, Boehringer has pushed management to understand how their budget decisions impact the entire business. That requires his team to be transparent about financial performance and goals and to treat management as partners in achieving those goals. Incentives also play a role, as compensation at Derivative Path is tied to company performance.

“By providing employees with parameters, we empower and entrust them to assess whether spending is warranted,” says Boehringer. Those who are closest to customers are often the first to spot opportunities for smart spending decisions.

Boehringer has also established a budgeting system that authorizes additional funds to be allocated when an investment hits certain milestones. This allows him to allocate dollars more efficiently. For example, ahead of 2023, Boehringer looked at a range of budget scenarios based on revenue performance that drive individual spending decisions.

“We want people to own their budget. When we reach a certain milestone, they can add another vendor or team member,” Boehringer says. “That way, we can be quicker in our decision-making throughout the year.”


Derivative Path is also working to make cash flow more predictable by favoring fixed revenue over variable revenue. “We offer a percentage discount to clients that want to work with us for three years at a certain capacity,” Boehringer explains. “That locks in consistent revenue. And, ideally, it’s prepaid. So that helps with any cash flow concerns.”

“We task all employees — regardless of function — with justifying spend through ROI.”

— Kurt Boehringer, CFO of Derivative Path

3. Stack-rank priorities dynamically with an eye on ROI and customer success.

At Brex, CFO and COO Michael Tannenbaum watched as the low cost of capital created bad habits across many growth companies in recent years.

“Before, with infinite resources, there was more of a set-it-and-forget-it mindset — investing in multiple businesses and just letting them run,” he says. “Today’s environment calls for a more focused perspective on what is an appropriate ROI.”

Together with the Brex leadership team, Tannenbaum worked to establish criteria for what was most important to the company: Investments and budget allocations would need to align with the company’s mission and contribute to customer success.

When several projects score highly on those factors, the team ranks them by priority and allocates costs accordingly, giving a top project a larger portion of the budget. The list gets revisited at least every six-month planning cycle, with quarterly adjustments, and budget and resources are shifted as needed.

“We’re optimizing where we spend our resources,” Tannenbaum says. “And that’s really the biggest thing you can do in a world of scarcity.”

This dynamic approach to planning allows the company to be nimble and react quickly at a time when it’s harder to predict what’s coming. “Most data models don’t even have data as far back as the last recession,” Tannenbaum says. “So I can’t just go look at a data model and expect it to tell me what to do. You have to have real judgment and think expansively around what you’re doing.” But keeping a focus on the customer, he says, is the best way to ensure that financial success will follow.

Tannenbaum is also keeping a CFO’s eye on risk factors that could affect the company. If customers have to pull back, or a banking partner changes course, Brex has to be ready, and Tannenbaum works with fellow leadership team members to develop strong contingency plans.

“And we need to have a contingency for the contingency,” he says. That’s why planning always includes worst-case scenarios. “If we don’t deliver for customers because something happens with our service, we lose that trust forever.”

“We need to have a contingency for the contingency.”

— Michael Tannenbaum, CFO and COO of Brex

Chapter two

Driving a culture of smart spending.

“Company culture” means more than just value and mission statements. After years of relatively easy access to capital, CFOs have the opportunity to establish — and create buy-in — around a new approach toward spending.

1. Balance top-line and bottom-line focus.

In March 2022, as the Federal Reserve prepared to increase the federal funds rate for the first time since 2018, the leadership team at global payments company Spreedly began looking at budgets with a new perspective.

“We didn’t really make any solid moves to change at that point, but we started the conversation,” says Nellie Vail, Spreedly’s CFO.

Until then, the message across the company had been focused exclusively on top-line growth. But by late spring, company leaders decided to create more sustainable growth by considering the bottom line and viewing every position through the lens of key priorities: Did the role directly contribute to revenue or growth? Was it mission critical? The evaluation exposed inefficiencies, as well as opportunities to fix them.

As a result, some people were shifted into new roles that were more in line with the company’s priorities. The exercise also led Spreedly to postpone hiring for some open positions. The board endorsed the company’s proactive approach, but the shift, Vail says, “certainly caused a company culture shift” that called for more transparency.

At the next all-hands meeting, Vail shared leadership’s new view on spending while reminding everyone of Spreedly’s vast upside potential.

“I was able to reinforce that we’re still looking at a solid 40%+ year-over-year growth,” Vail says. “The last thing you want is high performers moving on to another company because they’re concerned about the company becoming more cost focused.”

That combination of candid communication and forward-looking mindset can be critical in helping rally employees around a common mission of sustainable growth.

“The last thing you want is high performers moving on to another company because they’re concerned about the company becoming more cost focused.”

— Nellie Vail, CFO of Spreedly

2. Use multiple channels to make financial concepts more accessible.

Transparency and over-communication can go a long way toward empowering employees to participate in the company’s growth. At Brex, co-founder and co-CEO Pedro Franceschi sends out regular emails to the entire workforce, and the company hosts employee all-hands meetings every other week. Spreedly employees also get detailed updates on the state of the business, says Vail. To reach distributed employees, there’s more reliance on messaging apps, and the once-quarterly all-hands video calls are now once-a-month global check-ins.

Similarly, Danielle Murcray, the CFO of security business AttackIQ, says she may not always be able to talk about sensitive details behind a strategy or spending shift, but adds: “I can always explain the ‘why.’”

Telling employees “why” something is happening makes it easy for them to do the right thing. Understanding why certain expense policies exist, for example, often makes teams much more likely to act in a financially responsible way. They feel empowered when they are trusted with information.

At Cleo, a family benefits company, CFO Amy Kux holds office hours to talk about the economy and what it means for Cleo. “I find what we’re doing a lot right now is easing everyone’s state of mind so they’re okay with the unknown,” she says.

To ensure that the message truly resonates, Brex CFO and COO Michael Tannenbaum recommends going beyond charts and takeaways in all-hands presentations. Instead, Tannenbaum uses analogies to convey use cases — an approach that employees say makes the information much more digestible and approachable.

This kind of dialogue is especially important at a time when so many employees work remotely, and many companies have offices distributed around the globe. It helps generate a culture of trust that can be a motivating force and boost productivity.

3. Establish an ownership mindset among employees.

Transparency can also yield a bonus benefit: establishing an ownership mindset across the organization. When employees feel accountable for the continued success of the business, they feel empowered to flag opportunities for growth as well as potential cost savings.

Another tactic is to assign budgets to department leaders to share the responsibility for profitability with their teams. This empowers them to make smart trade-offs on behalf of the business. The idea is that workers closer to the customer often have a sharper sense of where opportunities lie.

“I find frontline employees have some of the best ideas because they’re dealing with things day in and day out,” says Joseph Gwozdz, who worked as a CFO for 20 years at various companies before becoming an operating partner at the investment firm Edison Partners.

With these practices, CFOs can get everyone — from intern to CEO — on board with spending smarter. When done right, employees won’t see financial discipline as a scary mandate at odds with growth, but rather a smart approach to creating a more sustainable business.

Chapter three

Playing to win in any market.

CFOs have the opportunity to play a crucial role in sustaining momentum in times of volatility. Here’s how leading CFOs are finding healthy and sustainable ways to stay ready for growth opportunities.

1. Don’t try to cut your way to profitability.

Investors still have plenty of capital to put to work, but most are no longer willing to fund businesses that don’t have a clear path to generating free cash flow or becoming profitable. That’s why it’s critical for companies to demonstrate to everyone from current investors to potential suitors that they can run a lean operation.

“Investors are looking at how companies are weathering the storm,” says Gwozdz. “They want to know how you’re dealing with inflation and an environment where you can’t spend money like crazy.”

But trying to cut your way to profitability is fraught. While it may provide some short-term relief, it’s unlikely to lead to long-term success. Murcray, the AttackIQ CFO, says savvy finance teams will focus on sales and marketing efficiency rather than cuts. “You can cut marketing spend as much as you want; it’s never going to get you to where you need to be,” she says. Instead, the focus should be on how much revenue and profit those marketing investments are able to generate, she says.

“You can cut marketing spend as much as you want; it’s never going to get you to where you need to be.”

—Danielle Murcray, CFO of AttackIQ

2. Consider going remote, distributed, and global.

Top talent has always been distributed around the globe, but many companies have been hesitant to hire employees in distant locations. The move to hybrid and remote work has helped many get past that hesitation. Going remote, distributed, and global is an opportunity to find skilled talent and generate cost savings at the same time.

“Encourage managers to think in terms of budgets rather than headcount,” says Tannenbaum, the CFO and COO of Brex. “If I give an engineering lead a budget of $10 million, it can mean very different headcounts if it's a US-funded team versus international team, and it forces them to make a trade-off.

“When you give them a budget, you're introducing scarcity, and the engineering manager will say, ‘I need horsepower here. I'm going to go fill 40% of that budget in India at a ratio of five-to-one versus what I can get in the US for that same dollar amount.’”

The decision to go global should be easier now that a proliferation of cloud-based tools for everything from communications to accounting to resource management have made it easier — and sometimes cheaper — to onboard and collaborate with employees from anywhere.

“Encourage managers to think in terms of budgets rather than headcount.”

— Michael Tannenbaum, CFO and COO of Brex

3. Use a spending prioritization matrix.

Many companies try to be all things to all people, but taking a broad view on your customer market risks increasing churn and could be costly in the long run. A better strategy for these times is to focus on pleasing — and retaining — the customers that best align with your core mission.

At Brex, Tannenbaum has developed a framework for ranking priorities based on a set of criteria laid out on a matrix. On one axis, he says, is the company’s mission and how closely an investment would be tied to the core product. On the other axis are less tangible criteria such as customer happiness.

Ranking Investment Priorities Matrix
Ranking Investment Priorities Matrix

“Ultimately, it will translate to financials. Customer success and financials are very closely correlated,” he says.

Similarly, not all products and projects will yield the same ROI. So instead of doing 10 projects, for example, it may make sense to focus on the top five and put spend and staff against those.

“You can still fund growth initiatives, but you stage the investment, and you release more investment once you have more proof points,” says Tannenbaum.

Key takeaways


Financial discipline and growth are not mutually exclusive. Keep a sharp eye on risk factors, stay ready for opportunities on the horizon, and keep these guideposts in mind as you play to win over the long term:

Creating a resilient company.

  • Make scenario planning a centerpiece of your strategy, because the only constant is change.
  • Task all employees with justifying spend through ROI.
  • Reevaluate your goals and set spending plans against them with built-in flexibility to react to a changing market.

Driving a culture of smart spending.

  • Be transparent with employees while also reminding them of the company’s upside potential.
  • Communication is especially key in the remote age. Use all-hands meetings, regular emails, and more channels to make sure everyone gets the message.
  • Establish an ownership mindset across your org. That way, employees will embrace financial discipline as a smart approach to creating a more sustainable business.

Playing to win in any market.

  • Don’t lose growth focus. Cutting your way to profitability may provide some short-term relief, but it’s unlikely to lead to long-term success.
  • Going remote, distributed, and global can enable you to add fresh talent and yield cost savings at the same time.
  • Focus on pleasing — and retaining — the customers that best align with your core mission.

“Someone’s sitting in the shade today because someone planted a tree a long time ago.”

— Warren Buffett


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