From Finance to Frontier Tech: Inside the CFO Role at a VC-Backed Engineering Business with Adam Uttley, CFO at Wayland Additive

Speaker A: Foreign.

Speaker B: Welcome to the Finance Seat. Practical podcast for finance leaders who want to know what actually works. I'm your host, James Roach, Managing Director of the specialist finance recruitment consultancy Head Start and a former Finance director myself. Each episode I'll be sitting down with a different CFO or fd, to discuss how they build strong M teams, manage uncertainty and deliver change so that you can do the same.

Speaker C: Welcome to the Finance Seat. Today I'm joined by Adam Utley. Thank you Adam for coming on. Uh, do you want to give us a quick intro who you are, what you do?

Speaker A: Yep. My name's Adam Utley. I'm the CFO of Wayland Additive based, uh, in Huddersfield. And uh, Wayland is a sort of hard tech, high tech startup, um, that produces machines that can 3D print parts in a range of metals. So it's probably um, one of the uh, I think the region's most interesting and um, best startups.

Speaker C: Really clever stuff. And we'll talk about that in a bit actually, because I've had a little tour which was amazing. Um, but kicking off about you, I suppose, in your career, when you look back, are there some key moments that you think that was the moment that propelled me to where I am here now?

Speaker A: Yeah, I've taken quite a circuitous route I think, in finance compared to many. Um, I kind of started at a university, I've worked in uh, PLCs, I've worked in private equity, I've run my own business, uh, and I've worked in startups as well. I think the theme that has run through most of that is kind of following good people. So uh, I kind of had a couple of mentors when I worked for a university and they took me under their wing, uh, and I did two or three different roles with them and really learned from them, which was great. And then after bt, I moved uh, to a private healthcare provider. Uh, and uh, the CFO there again kind of took me under his wing, gave uh, me a couple of different roles there and then pinched me, uh, and went over and gave me my first finance director role at ah, Brykes, uh, did a couple of roles there and then also gave me effectively my first CFO role. And that was much earlier than I would otherwise. Just because you're working for the same people and I think got more experience and more exposure early as a result of that. So I think that's been really key, I think some of it and the direction my career is really from an even earlier stage than that. So my dad ran his own business A clothing manufacturer based in Halifax. Uh, and that kind of been in and around that business uh, as a little lad meant um, that that was in the blood. Um, and I went back later in life when that was in trouble to go and rescue it with my CFO skills. And that's probably one of the more rewarding um, times of my life. Been able to turn that around. And so I think startups and turnaround type things has, has really floated my boat and I've really enjoyed doing them and, and sort of gravitated towards them and I think that was the genesis of that. But I think latterly I'd done a couple of CFO roles and got more and more senior and kind of bigger roles and then I decided to go and m do an mba, um, and did that for a couple of years and I think that was really instrumental in just allowing me to grow and think as a person. I wasn't doing a full time role at the time so that gave me a lot of space to experiment, um, meet people that were very impressive from different walks of life and be a sponge and suck up off them. And we were really, really in a close cohort and sort of each other's champions if you like. And that gave me the courage really to start my own business. I'd had a real I think fear of failure up until then. And especially being a cfo we tend to be quite risk averse. Uh, I'd had a sort of an itch of wanting to start a business cause my dad had run his own business. Um, but I didn't know where to start. But it was really that MBA that gave me that springboard to go and do it and try it. Um, and then I ran that for three years and it didn't succeed. And I learned more about myself in those three years than anything else. I think when you move up the ranks it's generally because you've been successful. So you take a lot of confidence from that and that's great. And in finance you're exposed to lots, lots of different parts of the business. So doing something that suddenly you're not very good at, such as selling, uh, and marketing in my case was uh, really humbling. And then having to run that business for three years and having to close it down at the end of three years was really humbling. So I think those are really the four things that have shaped my career. And I, I certainly feel that I find myself in a much more humble position now with less ego than I might otherwise have been having gone through those experiences and uh, yeah, sort of bring it all together now and try and help founders in startups and um, loving it.

Speaker C: Yeah, great. So you mentioned about the mentoring there. What I found with people that recognize the importance of a mentor on their way up tend to be really good mentors than themselves. And having got to know you, I've always noticed that about you, that you talk about developing people, mentoring them and things like that. Have you recognized that in yourself?

Speaker A: Yeah, I think so. Which is uh, I mean if you'd asked me would I think I would do that 10 years ago, it would have been a resounding no, I wouldn't have thought of myself as that person. But yeah, I think that comes in twofold really. I mean obviously from a team perspective you have members of your team who are you are mentoring. Um, you might have colleagues at the same level as you that might be a bit younger and mentoring and I think that's more so in startups. People get jobs in startups in particular because of talents and ability and not necessarily experience. Um, so that's great. And even CEOs themselves, particularly in startups you have CEOs are often thrust into that top job from somewhere and that could have been from a very early stage in their career. So they're learning everything on the job. And I think as a CFO within a kind of a startup, being able to provide that day to day shoulder to lean on and advisory, um, obviously the chairman if you have one and non execs and investors can provide that. But being able to provide on a day to day basis I think is really valuable. So that is certainly something I've tried to do in certainly in my last

Speaker C: two roles and it's quite rare for someone to have been a CEO and go back to being a cfo. Have you seen a difference in yourself now as a CFO to prior to being a CEO? Uh, if that makes sense. Do you think you're a better CFO now?

Speaker A: Undoubtedly, undoubtedly a better cfo. And I think that's as much for the things you don't do as much as the things you do do. I think I've always been a person that will rush towards a problem and even when that's in my area or out of my area. But I'd say I'm able to sort of coach people through that rather than trying to do it with that kind of experience. I think also recognizing the human element is quite important. It's quite a CEO or founder or both. It can be quite a uh, lonely Experience. There's a lot of pressure when people have put multi millions into your business that you founded. But suddenly you're under a lot of pressure to deliver the next milestone, the next proof points because your investors are under pressure from their shareholders. So there's pressure all the way down the chain. And so if you can find a way, sort of alleviate that and support people and advise and coach in a gentle way, then I think that's really valuable. I think earlier in my career I would have gone and done it or not been able to provide that advice. So yeah, okay.

Speaker C: Now um, Wayland, as you say, hard tech, deep tech, there's all sorts of um, words we can give it now. It's quite a rare space I suppose, isn't it? And what surprised you the most going in as CFO is that type of business?

Speaker A: Yeah, a couple of things I think internally kind of what surprised me from a personal perspective is to a certain extent I feel like I've got my one arm um, tied behind my back in that I've always been um, in a product led business that has been high volume and low value. So fast moving goods. Wine was my last business. And so with that comes a lot of experience of analytics and looking at trends in products or margins, et cetera. And you can bring a lot of value particularly to a startup if you've come from bigger businesses. But going to a business that's pre or early revenue, a lot of that isn't really there. Particularly in Wayland's case because we sell machines for you know, seven figure plus. So it's high value but much lower volume. So those trends and they're just not there. So it sort of feels there's one arm tied behind your back. I think the second is again in earlier tech what investors look for is a little bit different. They're not as interested in the management accounts. We have one thing that moves the dial and that is the number of machines we sell. Uh, everything else sort of takes care of itself in to a certain extent. So what investors look for and ask for is um, quite a bit different. And I think externally I thought the sector would be better supported actually. I think there's um, investment kind of follows government policy to a certain extent as well as prior returns. Um, it's a really exciting business and when I thought that wow, there's going to be a lot of money there, but what we find is it goes towards AI and et cetera, the sort of sexier things and even just being able to class yourself as a small Enterprise and all the advantages that comes as opposed to a medium. We found that, um, our net asset value because we've got machines pushes into being a medium company rather than a small. And that means the grants we get from Innovate UK aren't as funded to a higher percentage. So there's some sort of structural disadvantages which are just. I didn't expect to encounter.

Speaker C: Oh, wow. And then the innovation side, we talked about, um, or we alluded to it earlier with Wayland, um, at a tour of the site from Will the CEO. Uh, it's stunning what they do and the stuff that the machines can produce. It's kind of mind blowing really, isn't it? And I guess it's easy to get swept up in that and all the cool stuff that everyone's doing. Your job is obviously to keep the commercial hat on. How do you balance the innovation and the commercial without being the guy that's uh, slowing everything down?

Speaker A: This guy? Yeah. I think that is exactly the nub of the job. It is trying to speed it up. And I think understanding the dynamics of what is going to add value in the short, medium and long term and what the levers to pull are is really important. But it can be an uncomfortable place. So to give an example, our cost base, we're sort of 75% people and our costs, we run about 600k a month. So burn through 600k of cash a month gross. Um, but 450 of that is people and 150 is kind of other costs. Um, the challenge we've got is that your natural reaction if you're a bit short on cash or your Runway is not as long as a CFO is. I want to put that handbrake on and slow things down. But actually that's not always the right thing to do. Uh, especially in an innovation led company if you're paying for lots of clever people to innovate, the incremental cost of them buying equipment, uh, or whatever they need to run those experiments. If they can go twice as quick by spending that discretionary expenditure, uh, twice as fast, we can get things out to market much quicker. So if the limiting factor for us is the speed of which our technology is getting onto the machine and getting to market, actually the thing we need to do is speed up expenditure and speed that technology up. Now that's uncomfortable because the burn rate goes up and that's really uncomfortable for a cfo. But if you flip it round and the limiting factor is sales, then the reverse is true. So if the limiting Factor is sales. Actually you want to slow down some of the R and D discretionary expenditure uh, until you sort of your sales rate catch up. So it's recognizing where you are and where you're going to be and adapting accordingly. But it is uncomfortable and bamboozling I

Speaker C: guess in trying to flip your head the other way around, the way you're used to.

Speaker A: Well, at startup world it's trying to think today, uh, next quarter and um, three years time all at the same time.

Speaker C: Yeah. Okay. And you've got multiple um, investors, venture capital reporting to them, dealing with them. We hear from their side a lot of the time about what they're looking for and things like that. But in your experience what do you think they are truly looking for?

Speaker A: Yeah, I think uh, different investors look for different things. I think um, you've got to tick the box that you are going to be in control of things and there is no surprises. So being able to have an open dialogue is really important. Being able to look ahead and have the rigor of exactly what's happening and being able to produce a good cash flow and being able to talk them through that is absolutely the bedrock of that. Um, I'd say the second is being to a certain extent their eyes and ears within the business. They might have, will have conversations with the CEO from time to time but generally there are board meetings and they review the papers and I know being on the other side of the table when you're looking at something on only a monthly basis, it's easy to forget the things that have gone in the past and that's a tricky job. So somebody looking at the right thing to do and de. Risking decisions and making good decisions on a day to day basis is um, it is certainly what they're looking for. I know one investor in particular really in my case wanted me well, was glad I had a physics degree or understood the technology because they felt that was a differentiator and that certainly helped uh, understanding that. And generally throughout my career I've tried to understand the product and the market as much as possible because I think that's crucial. Um, but then finally I think as I alluded to earlier, I think being a, a sounding board for the CEO on a daily basis is really important because sometimes that sounding board will be about how to deal with the board and it's quite difficult to do that with the board. So um, so yeah, I think, yeah, those are the things.

Speaker C: And the growth expectations obviously are pretty, pretty high as well, aren't they? And you're not they're perhaps like you say, you're not doing monthly management accounts, you're not used to. You're usually doing that I suppose, in your tradition, traditional role. Is that the main difference, that okay, we're not doing monthly management accounts, we're more talking about the innovation and the spend and the Runway and stuff like that, or uh, is there a whole host of other things that are completely different to a more traditional role that you did before?

Speaker A: Yeah, I'd say certainly for me and my background, but I think it's true anyway. It's a broader role. I think in a startup when you've got 70 people and often startups are smaller than that, it's pretty big for a startup. But um, you don't have reams of specialists, you don't have a legal team and you don't have a strategy team and there's lots of roles that don't exist in that size company. And I think there are things that you build up in your career that you might not be an expert in, but actually you can very easily find yourself the most expert within that business. So you therefore become that expert and actually that's really valuable. So that might be strategy in some business, it might be operations in other business, depending on what it is. So uh, I think that naturally lends itself to being broader. Um, because of my background of running my own company and sort of looking after different things, I certainly started with a really broad role. I think six or seven departments reporting in. So that means there's always, there's always a problem. Right? Uh, in a startup of course there's always a problem because every area doesn't necessarily have uh, experts. Everywhere is kind of a 5 out of 10 and you need to be a 10 out of 10 in the thing that you are really pushing, which in our case is the R and D and the technology. But if we were 10 out of 10 in every other area, we'd be spending too much money. So we sort of. You want to inch everywhere up, but there's always a problem that um, emerges or a challenge that we need to overcome in a different area. And then it's just about going, finding that. And so that might be funding one month, um, it might be sales the next month and pipeline and it might be operations and building capacity the next month. So um, I know Ian, um, that you met the non exec when I came into the role and was headed the recruitment process, he said to me, well, I hope you don't get bored. And that could not be Further from the truth.

Speaker C: Yeah. And so I suppose, uh, we have a lot of people listen to this that are aspiring CFOs if you like, and they might be listening to this going, that sounds so cool, I want a bit of that. What advice would you give to them? What do they need exposure to earlier on in their career that's going to help them get your job one day?

Speaker A: Yeah, good question. Um, I'd say understanding the product in any business is really important and understanding the value drivers in the business. So what is really going to, for want of a better. Another buzzword, move the needle. Um, in terms of the profitability or whatever it may be. I've always really tried to touch and hold the product and understand it and who's buying it, what their needs are, et cetera. Sometimes time is a limiting factor on that. But really trying to understand that is super helpful. Um, I think the other thing for me personally there are lots of different routes I think to kind of CFO and this sort of level. I think it's quite hard though to learn what I will call private equity or VC level of intensity in different type of ownership models. So I could say PLCs or family business. It can come with a lot of pressure. Uh, but certainly when I've worked there, they didn't have the same level of intensity of private, you know, PE or VC. That is just like, like this. You're doing 100 things in a day and it's just m. And I think I got that, uh, early in my career through some roles within private equity backed businesses. I think if I'd come in to this sort of business later, having not experienced that, I wouldn't have understood it or been able to do that. And I think that's the sort of reason people tend to struggle jumping into PE businesses, for example, at CFO level. But I think the same is true at VC level to do a good job. So there's that. And then from a personal perspective, I would encourage people to try and get responsibility early. I think when you get to that top job. Again, this is common to all CFO jobs really, but especially in a small business, there's a lot of responsibility and often it can be things that you're not an expert in either. Um, you know, I look after people and you know, that's the first time I've done that. But there can be a lot of decisions that need making and a lot of things that need to happen and you've got the responsibility on you and you need to rush towards that. I think owning that being seizing it, if you like, for want of a better word, um, I think comes better from working in smaller businesses. So going and getting an FC job in a startup, I think can be a really good kind of springboard to that. Or getting experience on a board via a charity, which I've done a couple of times, um, is really helpful. You won't get the sort of PE intensity for that, but having that responsibility and having to sign off the accounts for the charity or, you know, having to put your name to stuff and, you know, having that responsibility was certainly a big factor for me and I'd encourage people to get that early.

Speaker C: Yeah. Okay. And aligning yourself with people as well, maybe further up the chain. You mentioned about mentoring earlier on.

Speaker A: Yeah, I think you can go faster. You can go further, faster if you've got somebody to support you through that journey within a company. So I got to CFO at 32. There's no way I'd have done that. Hopping between companies and roles, having built that relationship, knowing the business and having the trust that because I was good enough, I was old enough, helped. I think it always is a bit of a risk when he's talking to somebody external and you think, well, you look good on paper, but can I really trust you? So that really helps. I think it also, you know, we all suffer from imposter syndrome. Certainly I do. But if you've proven yourself with somebody and you've got that trust and they've backed you before and then give you another opportunity, you sort of not going in with that imposter syndrome to the same degree, you go in with a lot of confidence. And, um, so getting a kind of a mentor to support you through that journey can be really powerful.

Speaker C: And so with the great finance people that you've worked for and with throughout your career, what is the thing that you've noticed that you wish more people knew about?

Speaker A: Yeah, good question. I think, um, I mean, if you, if you sort of spend too much time on LinkedIn, you would believe all the, uh. It's sort of a cesspit of stereotypes on LinkedIn, isn't it? You get all those memes about, um, the CFO cutting the training budget and what have you. But, um, there's a couple of things. One is, you'll see lots of the CFO role is changing because, um, now we're adding value or driving the business rather than reporting on it. And I was thinking, well, that was happening in the 90s when I started, so it's not a new thing. I think though the other thing is people management again sort of CFOs are seen uh, not to be great people, managers, um, or leaders. And I've been lucky enough throughout my career to work for some great leaders that inspired me. Um, but inspired not only the people within the finance team but inspired and drove people, their colleagues and the rest of the business in terms of difficult decisions and difficult things that needed to be done. And so I witnessed great leadership and tried to learn from that. Um, and I don't think that gets uh, enough recognition.

Speaker C: It's often about the numbers not the people. I guess it's often similar answer I get. Adam, that's been great. Thanks loads for joining us. Thanks for watching or listening. See you next time.

Speaker B: Thanks for listening to to the finance seat. Before you go, please do take a minute to rate and review. It makes a huge difference and make sure you give us a follow so you know when the next episode is out. See you there.