Hiring a CFO: How to Assess Candidates Effectively
23 Sept, 20268
Hiring your first CFO, or replacing one who's outgrown the business, is one of the highest-stakes decisions a founder will make. This person will sit in every board meeting, shape how you raise your next round, and become the voice investors trust when making decisions. Getting this crucial hire right provides you with a trusted partner. Get it wrong and you're back to square one, only now with a disrupted finance function and a harder story to tell your board.
Most founders focus almost entirely on technical credentials: the right sector experience, a strong track record on fundraising, previous experience in familiar company names. That's a reasonable starting point. But the hires that work out are usually decided by what happens after the CV and how thoroughly you probe everything it doesn't tell you.
Having run CFO searches with hundreds of founders, we've picked up on the patterns that most first-time hirers never get to see. In this blog we're sharing the areas we consistently see make the difference between a strong CFO hire and a costly mistake, along with the pitfalls that catch founders out even when the assessment goes well.
What should you prioritise before you start interviewing CFO candidates?
Before you start interviewing, identify the five skills or experiences that truly matter for the next stage of your business. Keeping the list short forces you to prioritise. It also gives you something specific to test throughout the process rather than running every candidate through the same generic CFO interview.
Think about the milestones ahead of you:
- Are you preparing for a Series B with US investors?
- Building towards an acquisition or expanding internationally?
- Professionalising the finance function ahead of a potential exit?
The right CFO doesn't need to have done everything, only the things that matter most to what your business is about to become.
Why does EQ matter as much as IQ in a CFO hire?
Technical capability is relatively easy to assess. Emotional intelligence is harder, but for a senior finance hire, it's just as important.
A CFO is going to have to navigate difficult conversations, challenge the CEO and wider leadership team, build trust with investors, manage uncertainty and lead a finance team through periods of significant change.
Look for evidence of:
- Resilience through periods of pressure or uncertainty
- Strong communication and storytelling skills
- The ability to challenge senior stakeholders constructively
- A growth mindset and willingness to adapt as the business evolves
- Confidence in hiring and developing people who may be stronger than them in specific areas
This becomes particularly important in an early-stage business, where the CFO's remit is likely to change considerably as the company grows.
What should you look for in a CFO candidate's career history?
Career progression is another area that can be surprisingly revealing. A CV tells you where someone has worked. It won't tell you why they left, and that's often the more useful question. Understanding what motivated a candidate to take on different roles, leave previous businesses and pursue their next opportunity gives you a much better sense of what they are looking for now.
For example, someone who has spent the last decade operating in highly structured, mature businesses may have an impressive track record but limited appetite for building a finance function from scratch. Equally, a candidate who has spent their career in early-stage companies may be looking for a very different environment once a business reaches scale.
Getting this wrong can lead to losing a candidate within a year because the role wasn't what they expected.
Should you bring investors into your CFO search?
If you’ve raised previously, investors can bring a valuable perspective to the CFO search as they will often have experience with similar hires across their portfolio and can help pressure-test the profile you’re looking for. They may also be able to introduce candidates through their own networks.
Investor input can be particularly useful around fundraising, financial strategy, risk management and the company’s longer-term direction. That said, investors shouldn’t make the hiring decision, the CFO has to work for you and your leadership team, not for the board.
How do you test how a CFO candidate actually thinks?
While interviews tell you how someone talks about their experience, a case study gives you a much better sense of how they approach a problem.
For a CFO search, this could be based around a real challenge the business is facing. It might involve a fundraising scenario, a plan for improving margins, an acquisition opportunity or a finance function that needs to be rebuilt.
The objective isn’t to find the “right” answer. Instead, assess how the candidate
- Structures an unfamiliar problem
- Identifies the information they need
- Balances short-term decisions with longer-term implications
- Communicates financial and strategic thinking
- Handles ambiguity and competing priorities
- Brings other stakeholders into the decision-making process
It also gives the wider leadership team something tangible to discuss after the interview, rather than relying solely on impressions from a conversation.
How do you get better references on a CFO candidate?
One reference call from a name the candidate hand-picked tells you very little, a stronger process gathers perspectives from different parts of the candidate's career. Previous CEOs and board members can give insight into strategic impact and leadership, while other C-suite and former team members can provide a different view of how the candidate operates day to day.
Focus the conversations on specific achievements, leadership style, emotional intelligence, cultural fit and any development areas that have surfaced during the process. But make sure you agree with the candidate upfront on who can be contacted and when, particularly if they're still employed.
Even a strong assessment process doesn't fully protect you from tripping up elsewhere. Plenty of founders run a thoughtful search, ask the right questions and still get the hire wrong, not because they misjudged the candidate, but because of how the role itself was framed, resourced or timed.
AVOID THESE COMMON HIRING PITFALLS
Hiring a CFO for the first time is a major moment for any growing business, but it's easy to trip up on a handful of recurring mistakes that have less to do with who you pick and more to do with the decisions around the hire:
Giving the CFO title too soon
Promoting a Head of Finance or Financial Controller into the CFO seat can feel like the natural next step. But the person who's been right for the business so far isn't automatically the person it needs next.
As financial complexity grows, the CFO remit can expand into fundraising, board engagement, strategic planning, M&A, risk and long-term capital allocation. Giving someone the title before the business needs that level of leadership can also create a difficult situation when you eventually need to hire above them
Underfunding the team
A CFO buried in day-to-day reporting and cash management can't also be your strategic partner, there simply isn't time for both. If the finance team underneath them isn't properly resourced, the CFO can quickly become responsible for reporting, cash management and operational tasks that prevent them from focusing on strategy, leadership and decision-making.
Before making the hire, be clear about what support the CFO will have and what needs to be built around them.
Overhiring on strategy
It's easy to get excited about a highly strategic CFO, particularly when you're thinking about the next few years of growth.
But if the business still needs someone who is hands-on with cash flow, financial operations, systems and building the team, a CFO operating several steps ahead of the business may not be the right fit.
Underhiring on strategy
The opposite mistake can be just as costly. Hiring a strong finance person who isn't equipped to provide strategic guidance can leave founders without the financial sounding board they need as the business becomes more complex. The role needs to reflect both the company's immediate requirements and where it is realistically heading.
Misalignment between founders and CFOs
Underneath most of these mistakes is a conversation that simply didn't happen early enough. Candidates oversell, or quietly gloss over the areas they're weaker in. Founders, often without meaning to, describe the company as more mature or better resourced than it actually is. The result is the same: expectations don't match, and the gap only becomes obvious after the person has joined. Being upfront about the company's current stage, challenges, resources and expectations gives both sides a much clearer picture of what the role actually involves.
Ready to hire your CFO?
The best assessment processes look past the CV to understand a candidate from several angles at once: what they've done, how they've done it, why they made the choices they did, and whether any of that actually fits what the business needs next.
Just as importantly, founders need to be honest about the role they're hiring for. The right candidate can still struggle if the expectations are unclear, the team is under-resourced or the business isn't ready for the level of leadership they're being asked to provide.
If you're a founder thinking about hiring a CFO, you don't need to have everything figured out before starting the conversation. We work with founders every day on finance leadership hires, from understanding whether the time is right to defining the profile, assessing candidates and navigating the process. We're always happy to share our experience, knowledge and perspective, whether you're ready to launch a search or simply starting to think about what your business will need next.
If a CFO hire is on your horizon, don't hesitate to reach out for a conversation.
Choosing the right CFO starts long before you meet the candidates.
In our CFO Hiring Playbook, we explore how to assess your readiness for a CFO, define the right leadership profile, evaluate candidates, and understand when a fractional or interim finance solution may make more sense.
