As the Federal Reserve seeks to meet its dual mandate to curb inflation while achieving maximum employment, CFOs must perform a similar balancing act between profitability and growth. Yet financial executives need to ensure they’re not trying to fulfill that mandate in a way that’s penny-wise but pound foolish, Seismic CFO Evan Goldstein said.

“If you end up cutting R&D to the bone and you're not improving the product for the sake of profit, well, you're going to lose customers,” Goldstein said in an interview. Rather, “it's really about understanding what your customers need and what their focus points are,” he said.

Careful cost-cutting

Goldstein describes himself as a “growth-oriented CFO,” noting that while the pendulum between growth and profitability tends to swing back and forth, “at the end of the day, growth is what's critically important,” he said. “And I think you have to be really mindful that if you are just cutting costs for the sake of profit, that is not the right way to do it.”

Goldstein joined the San Diego, Calif.-based enablement company in August 2022 as its finance chief after an 11-year span at Salesforce, according to his LinkedIn profile. He served in various roles at Salesforce including SVP of investor relations and as SVP, corporate planning and operations finance and strategy. His past experience also includes a 10-year tenure at biotech research firm Genentech, and he began his career at the Ford Motor Company.

That pendulum between growth and profitability made a hard swing back to profit over the past two or three years, a shift Goldstein attributes in no small part to the economic trends that have prompted shifts in monetary policy — propelling businesses out of a long, unprecedented period where interest rates hovered around zero.

“So much of this debate over growth versus profit is driven by the markets and can be driven by monetary policy, by the [Federal Reserve],” he said. “When money's really, really cheap, you can go and spend it.”

Now that interest rates are higher, “that's put pressure on companies and their values, on the importance of profitability. It's no longer growth at any cost,” he said. However, during the past six months or so, Goldstein has seen markets begin to respond back to growth, fueled in part by the “soft landing” achieved by the Fed and steady investment in artificial intelligence, he said.

The renewed pressure to deliver profit can be a benefit, helping companies improve their approach to investment and new technologies, Goldstein said. AI is a current focus of concern, he said, noting that its return on investment and full potential remain murky, posing tough choices for CFOs.

At Seismic, Goldstein created a steering committee comprised of himself, the chief product officer and chief business officer where, if an employee or team member wants to buy or renew, or deprecate a software tool, “they have to come to this monthly meeting with a one page document to talk about, how do they engage with procurement on it, what's the value they're going to get for?” Goldstein said. A similar approach to AI is critical.

“We're a high growth company. We're a young company, and AI technology is ... moving so quickly,” he said. “You want to experiment, but you need to do it in a controlled environment where you're not putting all your chips on in the middle on an unproven piece of technology.”

Curating the CFO ‘toolbox’

Goldstein’s value-driven approach to software and technology also extends to how he tackles the role of the CFO, coming at a time when the role has continued to broaden and evolve. Finance chiefs today are expected to help drive strategy and to create a path for the business to effectively execute that strategy.

For Goldstein, the CFO role today is much more about facilitating a conversation about those trade-offs and the investment strategy needed to “get to a given goal, rather than just saying, yes, no, you have the opportunity to spend that money,” he said.

“The way I positioned it to the people on my team when I joined the company, is like, we're not the no police,” Goldstein said of the way the CFO role has shifted. “We're about making trade offs. We're about helping the business get to what their goals are.”

Goldstein himself decided to pursue his goal of becoming a CFO relatively early in his path as a financial professional, he said. His first inclination that the finance chief role was the direction he wanted to go came during a graduate level econometrics class at North Carolina’s Duke University, where he earned a bachelor’s degree in economics and computer science before earning his MBA at the University of California, Berkeley.

“I had a professor at the time, and he always sort of asked questions along the line of ‘well, what as a business professional, what do you think they should do?” he said of the class. “It was always a mixture of mathematics and business strategy, and it just really appealed to me.”

When it came to cultivating the skill sets needed as a CFO throughout his career, Goldstein pointed to the advice of an early career mentor at Genentech who stressed the importance of real-world experience after college — likening the first steps of one’s career to gaining an empty toolbox.

“You need to decide what skill sets you want to put in that toolbox, and I was regimented about it,” Goldstein said about his approach to gaining the CFO seat. While learning core financial skills, he also took several classes in other areas such as marketing and focused on adding softer management and communication skills to that toolbox, he said.