A veteran of private-equity backed software and services companies, eDiscovery firm’s HaystackID’s new CFO Dave Murray believes it’s never too early for companies to prepare for growth — even if the next capital event isn’t imminent.
The temptation from a finance standpoint is to get caught up in putting together perfect spreadsheets when what companies need to build toward is the future growth while keeping cost-constraints in mind, he said. It's like a family “making sure the table can open up and you can put a leaf in it if you think you’re going to have a bigger family,” Murray told CFO Dive. “You have to think about where you’re headed toward and not necessarily where you’re going to be in the next two weeks.”
Murray last month joined the eDiscovery firm, which serves law firms and corporations facing investigations and litigation. He was previously at the software company Suvoda. HaystackID, with about 220 employees, is on track to make more acquisitions, although not right away, he said. Right now Murray is busy integrating six acquisitions that HaystackID has made in recent years, including its merger with NightOwl Global last year. The company also was recapitalized in 2020 by Quad-C Management, a middle-market PE firm.
Currently Murray is implementing a new enterprise resource planning (ERP) system, he said. The new system will unify financial data on payroll, revenue, billing rates and accounts receivable which is now scattered or siloed across the entities that were acquired. The new system will make it easier to look holistically across the company and make decisions, he said.
Murray is also planning to grow the company’s now seven-person finance department to add two positions in FP&A over the next six months. Filling those roles will be challenging; even before the war for talent it was difficult to find the right candidates for such positions, he said. “It’s kind of like finding a purple squirrel,” he said. “They have to be good in Excel, a self-starter and have a balance of skepticism and optimism,” he said.
While the company was remote even before the pandemic, starting at a new firm with the new COVID-19 variant Omicron looming has had its challenges, Murray said. “I’m coming in cold with a team in flight and trying to get them to follow slightly different directions and get buy-in,” he said. He’s sought to connect by introducing a daily call in the mornings where he gets updates on what is happening. “It’s almost like speed dating,” he said.
At the same time, the threat of a potential return to lockdowns could dampen the company’s pace of growth if courts close again and he thinks it will be important to keep an eye on payments in case companies start to slow payments and “stretch cash out” as a hedge against risk.
But so far the capital markets have held up and remain flush and Murray is making sure his company can provide data that could be needed should any opportunity offer itself — from an investor potentially wanting to exit or a new acquisition target surfaces. “When you’re private-equity backed you always have to be ready,” he said.
