10 Questions for Total Defense CFO Marcus Smith
Name: Marcus Smith
Time with company: eight months
Education: Bachelor of Science from the California State University, Chico; MBA from the University of Chicago
Company headquarters: Islandia, New York
Number of countries: six
Number of employees total: 50, but expanding
Number of employees the CFO oversees: five
About the company: Total Defense offers malware detection and anti-crimeware software. A former CA Technologies business, the company's software has been deployed by more than 50,000 businesses globally. It has operations in New York and California in the U.S., and in Europe and Asia.
1. Where did you start in finance and what experiences led you to the job you have today?
After earning my Bachelor's from Chico, I took a fairly traditional accounting route and went to work for Price Waterhouse in public accounting. I figured I'd stay for a couple of years and then leave after I got my CPA license. I got my CPA license and ended up staying a total of 11 years, but that included a two-year stint in grad school. I enjoyed Price Waterhouse more than I thought I would, especially the professional collaboration. You had a lot of great people coming out of school and also at the partner level. But I ultimately decided it was just too accounting-focused, so I moved over to industry.
Not that long after, Sarbanes-Oxley was passed and pushed some of the regulation down to the corporate level. I was groomed to go work in the public world with that background. So the first company I went to after Price Waterhouse was a tech startup, before the tech bubble. I think the company went public more on the reputation of the CEO rather than the product. It went bankrupt within two years of going public. So after spending 11 years in one place pretty much, I joined probably the earliest stage startup I've ever really been at, but the bubble really did take off. We had a grandiose yet unproven business model. We were ready to go on our road show when the market began to deflate. We were able to sell ourselves to someone else at a reasonable valuation level. There are some memories during that time, some discussions that were had and decisions that were made, that showed how out of touch the market was with the reality.
I've been at four other companies since then -- later stage startups to midlevel companies, mostly at the CFO level. Only recently, I was referred by a friend of the CEO here, and the rest is history. The background I have with the strong tech accounting background with medium-stage to later-stage companies and small to medium-size companies, provides a great background as a company goes through its growth cycle, especially where we're at with Total Defense. The company has established itself outside of the umbrella of CA but also is establishing itself for growth as well.
2. Who was an influential boss for you and what lessons did they teach you about management and leadership?
The one I want to point out was at the company I was at during the bubble days. We brought in a whole entire management team from the media industry because that was the pitch of the company's business model. Included in that team was a CFO who came from a traditional banking background. I pretty much handled the day-to-day accounting aspects and he handled the process. I liked him a lot personally. The one thing he did, which I didn't appreciate at the time, was this detailed preparatory work, whether it relates to discussions before meetings, whether with investors or whomever. He spent a tremendous amount of time working on that in advance, not only the script but the potential Q&A that might go on afterwards. I learned to appreciate the fact that a well-conceived answer that may come up to a random question from the audience will do a lot to build confidence, whether that's with a board member or a customer.
3. What are the biggest challenges facing CFOs today?
It varies a lot based on the size and characteristics of the company, but I think in general CFOs are being given a lot more operational responsibilities across the board. While I think that's a fun and interesting part of the job, it doesn't give you a reprieve on the numbers or on making sure that the numbers are right. You're spending a lot less time on that [as CFO] and having to rely on your staff for the accuracy of the numbers, so you can't get too mired down in the details of the numbers versus spending time on the strategic elements that you have to get done. You really have to have a lot of trust in your team and the processes you have in place.
4. What is a good day at work like for you?
The most satisfying thing at work is when you have a very productive day, you're collaborative, you get decisions made. The converse of that is spinning around and the continued process of not being able to resolve issues, and wasting a bunch of peoples' time. But if you can pull that together and get something done by the end of the day, that's a good day.
5. How would you characterize your management style?
I'm fairly open in terms of working with my team and trusting of my team to drive the data and the operational aspects. Obviously, there's some startup time [being relatively new in the job] in getting comfortable with individuals, but they're going to drive the day to day -- I try to stay out of it unless someone has a problem or needs some focus.
6. What strengths and qualities do you look for in job candidates?
Part of that relates to the last question. It's very important that an individual can work well in a team environment, but I also want personal drive from that person. By that I mean you do your best. If you can find someone who has both of those elements, whether at the entry level or more senior level, I think you're going to have a really solid team, particularly in the startup world. In the startup world, people are wearing many different hats, there's less built-in infrastructure like there would be in a larger company, you're relying on individuals. Another piece of that is that it's important that individuals aren't doing things by rote. If they're not thinking about what's gong on, that needs to be brought to someone's attention.
7. What are some of your favorite interview questions or techniques to elicit information to determine whether a candidate will be successful at your company? What sort of answers send up red flags for you and make you think a job candidate wouldn't be a good fit?
I have a fairly easygoing interview style. I'm looking more for team fit. A lot of that is just listening to the individual talk about past experiences, past jobs, why they went from one job to another. You can learn a lot if you're listening closely. For the most part, I've been pretty successful at reading that. I've had one bad experience in the past -- I still struggle to this day with how I could have dealt with that sooner.
There are some obvious [red flag] answers -- if they're bad mouthing other individuals from their firm, that's pretty black and white. But it's more how they talk about how they work in their organization that gives you more of a feel for their working style and how they work within that organization, how well they do working with the team versus working on their own.
8. What is it about your current job, at this particular company, that sets it apart from other chief finance positions?
One of the key attractions for me when I made the decision to join Total Defense was the ability to join a reasonably sized startup. We're not at the public-company size yet, but we're a later-stage startup. We're coming out of an existing company, we've got a good solid business at a good run rate and now we get to put our own infrastructure in place. The one thing I didn't realize was how difficult it would be to do that while we also had to operate the business on day one, because we had no infrastructure yet. We have to be fully functional and put in a pretty massive infrastructure, with an ERP system and other things. But my background has been with similar situations.
9. What do you do to unwind from a hectic day?
The best thing for me is actually before the day starts, if I can get in a run or another form of exercise. And a glass of wine at the end of the day can definitely help.
10. If you weren't doing this job, what would you be doing?
Other than spending more time with my family, my wife and two kids, I would love to get involved with an environmental or humanitarian organization at some time. This work [at Total Defense] is more tangible -- we're protecting the Internet to make people's lives better. But it would be fun to work at some place where you feel like you're doing something good across the board for the people you're working with and the world as a whole.