The Journey of a(nother) Fractional CFO

In this episode, I’m thrilled to be joined by @Manny Skevofilax, the Owner of @Portal CFO Consulting a consultancy that Manny has been operating for over 20 years with a mission to help business owners make more money by successfully navigating the challenges of growing their businesses profitably. 

In this conversation, my first with another fractional CFO, the tables are turned and Manny and I discuss his journey from restaurateur, through to Corporate Banker and now to Fractional CFO.

🌟 Some of my favourite parts were:

✅ Manny’s family background and how his parent’s experiences helped shape Manny’s own professional journey;

✅ How Manny’s first career as a restaurateur helped shape his views on cash and subsequent advice as a Fractional CFO;

✅ The importance and grounding that continuous learning provided Manny – most notably how to think about credit risk and analyse a financial statement;

✅ On the contrary though, how successful billionaire business owners dismissed complex financial calculations and relied on simplicity to keep everyone rowing in the same direction;

✅ How small business owners can be resistant to change but through gentle education and helping clients improve their profits, Manny has been able to work with some clients for upwards of 20 years.

Business Book Bonus:  Million Dollar Consulting, Alan Weiss

https://www.amazon.co.uk/Million-Dollar-Consulting-Alan-Weiss/dp/0071622101

Transcript

Adam (00:07.891)
Okay, great. So today I'm here with Manny Skevofilax, who is owner of Portal CFO Consulting, a fractional CFO consultancy that Manny's been operating for over 20 years with a mission to help business owners make more money by successfully navigating the challenges of growing their businesses profitably. Manny, welcome to the Fractional CFO Show. How are you doing?

Manny Skevofilax (00:30.574)
I am doing fantastic. Adam, thank you for having me.

Adam (00:33.779)
Thank you very much for being here. And so today we're gonna dive into a journey that I'm on and you are also on, which is that of a fractional CFO. You're a bit further along than I am, Manny, so I'd love to hear a little bit about your career so far. So could you give me a quick overview of that?

Manny Skevofilax (00:51.822)
Sure. You know, my parents were born on an island in Greece named Karpathos. They immigrated here after World War II and they got into the restaurant business. So I actually grew up in the restaurant business and I made a career change at age 29 to go into corporate banking where I had a lot of great teachers and mentors. And then after the stint in corporate banking, I decided that I wanted to try to become a consultant.

So I hung my shingle out at them as then, back then they called it a virtual CFO to try to help business owners grow their businesses profitably. And I've been very blessed to be able to be in this occupation for the past 20 years.

Adam (01:39.931)
Excellent, excellent. So tell me a little bit about why you decided to make that move, perhaps first from the restaurant business to corporate banking and then from corporate banking into the world of being a part -time CFO.

Manny Skevofilax (01:55.566)
Yes, great question. I wanted something more. My parents always stressed education because they were not able to complete their own educations due to the breakout of World War II. And I like the restaurant business because I was learning a lot about costing and pricing. And you're always able to come home with cash in your pocket. But I wanted to do something a little different. I was overly ambitious.

Back then, now I would say I'm ambitious. I wanted to do something else, try something different. And I had mentors back then that said, you know what, you could always open a restaurant when you're 50. So I had some guidance there and I said, you know what, let me give it a try.

I gave it a try. I actually went back to school and got a master's in finance. And then when I graduated, my college advisor at the time, she's the one that told me I needed to go get into a commercial lending training program. And I actually had to move to find it. I moved to Dallas, Texas, actually, to get a job with a bank and inside that commercial lending training program.

Adam (03:14.483)
Great. And in terms of the commercial lending training program, was that a one year course, a three year course? How did that, what was the structure of that?

Manny Skevofilax (03:24.782)
Yes, typically. Well, first of all, it starts with a formal credit training, so you're actually in a classroom and you're there with your, you know, your fellow peers, you know, new hires and you are taught by senior bankers. So you start out with the classroom training and then they actually place you. They send you into the various loan groups. For example, bank is segmented.

over here in the United States in different segments. For example, small business, middle market, large corporate, specialty lending groups. So they rotate you around through those various departments as a credit analyst so you can learn from the more experienced senior people how to lend money. And then hopefully one of them will hire you. So I got a chance to learn and then eventually I got hired in the syndicated lending group, which was...

It was a great educational experience. Where the loan is too big for one bank to make, so they have to put a group of banks together and split up the loan. So one customer might be five banks in the syndicate, might be 100. So it was a great learning experience.

Adam (04:41.043)
Tell me how did that help you when you moved into helping business owners? What were the lessons that you took from your corporate banking career that you were able to transition over to your virtual CFO career?

Manny Skevofilax (04:53.646)
Yeah, there's definitely two things there. The first thing was financial statement analysis. You were taught, so I was taught how to analyze a financial statement. So I learned it first in college, right? Grad school, undergrad, but then I also got practical training and these experienced senior bankers, they would show you how to analyze a financial.

and determine whether or not this borrower is a good credit risk. So that was very helpful. And then the other piece was, you know, I come from a poor family. I'm the first generation born here in the United States. I just, you know, I never wanted to be poor. That was my it's always been my biggest driver. And, you know, I got a chance to work as a relationship manager with some wealthy billionaire business families, which actually started in banking.

And I got a chance to see how they managed, you know, a hundred businesses that they owned that they couldn't possibly visit all their locations, you know, how they made those businesses more efficient, how they managed all these different cultures. And I took the, you know, that experience and brought it to the smaller rapidly growing customers, which saves them time when I'm able to come in with, with my experience that I've been lucky to get.

I save them time on the way and say, hey, this is how the larger firms do this. It will pay benefits to you and your business down the road and it's much more cost effective.

Adam (06:34.483)
That's great. And what are those, I guess, some of those key lessons that you are able to pass on from your big company experience to those smaller businesses? Perhaps a couple for our audience here who are generally smaller business owners would be great.

Manny Skevofilax (06:50.638)
Yeah, great question, Adam. It's actually kind of funny. My father. And all my mentors back then when I was young, they used to do all the calculations in their head. They used to calculate, you know, cost of goods sold and and pricing in their head. So when I got into school. And they started showing me how to do it with a spreadsheet, I was like, unbelievable, you know, my.

my dad, my parents, my mentors, they were all doing this in their head. They didn't have spreadsheets and stuff like that. Right. So that was really, really fascinating. And then I was under the misguided impression that I was going to walk into a business and calculate the present value of future cashflow. That's what I thought was going to happen. But it didn't happen like that. The very, you know, successful, very wealthy, the billionaire families, they use.

The same simple lessons that my parents used. So it was the exact opposite. They kept everything very simple. I always thought it was going to be very complicated. So that was a big lesson that I learned early on in my career was to keep it simple. And the second thing is when you keep it simple, the people that you're trying to teach are more likely to understand what you're saying. And that will help.

a culture to change. When you make it complicated, in my experience, and actually, you know, I was taught this, you make it complicated, people are embarrassed to tell the boss, Adam, I didn't get what you were saying. They don't want to talk that way. So they'll just kind of nod their heads. And then meanwhile, you'll be saying, wow, I wonder why this is not taking effect. You know, I've tried so hard to teach everybody, you know, how we want things to run here to be smooth, but nobody gets it.

But if you keep it simple, you have a much higher chance of getting everybody to row ROW in the same direction.

Adam (08:56.051)
I love that. I was always taught the same thing, keep it simple, stupid, kiss, as the acronym to stick with because the people you're speaking to, the business owners, the billionaires, whoever it may be, they've got other priorities. And so by keeping it simple, explaining it in layman's terms, you're going to have the best chance of them taking on board, right?

Manny Skevofilax (09:00.526)
You're right.

Manny Skevofilax (09:18.158)
Very well said.

Adam (09:20.467)
And perhaps it'd be interesting to hear when you first go into a new client, what are some of the steps that you take, the processes or the strategies that you outline to them to get them excited and on board? Are there any kind of maps you use or formulas you follow to be able to do that?

Manny Skevofilax (09:41.422)
Yes, the first thing we will do together is a financial statement analysis. We will print out the financial statement for that business, income statement, balance sheet, statement of cash flows, and we will do a full -blown credit review, just like a bank or an investor group would do for your business. And by using that really easy method,

It will generate a series of questions that I will then ask the business owner. And it's really fascinating because 90 % of my clients are great at their trade, but only 10 % really have any idea of the financial side, right? And I gently explained to them, I can't do your job. I can't run this business better than you can. And by the way, this is all I know how to do.

I just happened to study finance my whole life. So we need to work together. So we do that financial statement analysis and a whole host of questions emerge and we do comparative analysis and then we start from there. What are our questions? What questions do we have?

Adam (11:01.683)
Great. And with the financial statement analysis, because I've had the situation, I'm sure you have as well, where you'll go into a business, you know, it's been trading well, you know, we've been going for years, but they won't always have all of their books in order. What is your kind of approach to dealing with that kind of situation where literally you've just got bank statements?

and nothing else. Is there a time where you would go, actually, no, I can't help you until you're more organized, or would you help them on that journey and get them more organized?

Manny Skevofilax (11:23.756)
Mm -hmm.

Manny Skevofilax (11:33.742)
Yes, I would help them. I would explain to them why it's important to use some kind of software to make life easy. For example, I had a client, he's still my client. He kept every transaction in a spreadsheet when he started his business. And he told me, he's like, I'm keeping every transaction in this spreadsheet. And then when I'm ready to start working with you.

You know, you can then show me how to put it into software. And he did the most unbelievably awesome job. Everything was accurate. And we took that spreadsheet and loaded it into some financial, you know, accounting software. So, yeah, so we stress to them the value of having accurate numbers and why they need this kind of cumbersome or bothersome, you know, accounting software and someone to manage it because they're not they're not the ones to manage it. They need to be focused on.

you know, running their business and selling. So that's how it starts.

Adam (12:37.843)
Yeah and I guess in terms of resistance to that approach do you ever get resistance from them? You know this is the way I've always done it, I appreciate you're the expert but I'm not changing my ways because I've been doing it this way and it's worked so far. Will you get resistance and then how do you overcome that?

Manny Skevofilax (12:55.726)
That's a great question. Yes, there is resistance every day because as human beings, we don't like the change. We like to be in our comfort zone. However, in the context of some outsider, you or me, trying to come in and help the business owner, this is our tool. This is what we're bringing to this battle. And if we come in here without these tools, we're not going to be able to help you.

We are in effect doing you a disservice. So that was then and this is now. And sometimes you couch it in terms of the success of the business. Having these tools will help you pinpoint exactly where you could do some tweaks in your business to help it make more money. And that gets their attention.

Adam (13:45.683)
Yeah, yeah, that's a great approach. And you mentioned before when we spoke that you've had some clients who've been with you pretty much from the beginning, right? I think you said 17 years with some of your clients have been with you. I'd love to know how you've been able to retain those clients and maintain those relationships over all those years, because that, you know, the type of relationship that we have with clients can be quite transactional project -based short -term. So how have you been able to extend it for so long?

Manny Skevofilax (13:57.186)
Yes.

Manny Skevofilax (14:16.75)
Yeah, that's a great question, Adam. And sometimes I don't fully understand why, you know, but evidence, my clients will say certain things that that make me understand why. So my mentors taught me that if you're a consultant to a business, it doesn't matter what you think. OK, you can't say I'm doing a great job for Adam's company. You got to go ask Adam and see how Adam feels. So.

What I found out was it's different from each client. So one client was impressed with my ability to read a bank legal document. They were about ready to sign up one alone. And I was down there in the fine print because that's what I was trained to do. He didn't have that training. He was in IT. So later he told me that's when I knew that you knew your stuff. Because I pointed out an error in a bank doc.

And the banker insisted that I was wrong. This is at the closing, by the way, of the commercial loan for this client so they can use the proceeds to grow. So that was one example. The other examples are because they're not complimenting you every day. So you really don't know exactly. You know, sometimes it comes out that they like your approach. So I think it's different from for everybody.

One thing that I like to say is that, you know, as a financial professional, there are, I don't consider myself as having any competition at them. There are tens of thousands of competent financial professionals all over the world. I view us as chefs. We are going to make you lasagna. It is going to be tasty and it's going to satisfy you. Now you, Mr. and Mrs. customer, need to make the decision on which chef you want to work with.

You want to work with Guy Fieri. You want to work with Rachel Ray. You want Chef Manny. You want Chef Adam. Which approach, which personality do you like working with? And I think that's the key.

Adam (16:26.291)
Yeah, no, I think that's exactly right. People do business with people, right? And so there's always someone who can do the job as well or better than the other. And it's just about who clicks with the customer best. I think that's exactly right. You mentioned, and I'm interested, given your length of service, I say respectfully, with regard to how long you've been dealing with customers, how has your approach changed to sort of how you...

Manny Skevofilax (16:30.658)
Mm -hmm.

Adam (16:54.935)
deal with them and engage with your clients over the years. Have there been any major changes, whether that be technological changes or just in terms of softer skills, your approaches to supporting your business owners?

Manny Skevofilax (17:07.438)
Yeah, that's a great question, Adam. I definitely feel like I've become more gentle in my approach because, you know, for you and me, it might be matter of fact, hey, you know, you've got you've got too much accounts receivables here relative to your sales. It's a matter of fact statement. But if not presented properly, I learned the hard way. It can be very painful for a business owner to be hearing that perhaps they're not doing as good a job on something.

As they could be because they're they take a lot of pride in their work just like we do. So. Definitely being more gentle and then. I could not do my job Adam without technology. Um? Technology has been amazing. And it enables me to handle. Far more clients than. Then I otherwise could. And I'm constantly looking to.

make myself as efficient as possible. I don't want to get on a meeting with you for two hours. You've got other things to do. And if you're listening to my financial rhetoric, you're going to be very burnt out and you're probably not going to have the same energy. So I try to keep things quick and fun, not boring, because it's not the most fun subject to talk about.

Adam (18:30.163)
Much as we enjoy talking about it, I know what you mean. Yeah. In terms of the technology that you use, is there a piece of software that you've really kind of embraced, whether it be Excel or QuickBooks or what is it that's kind of you've taken into this world of fractional CFO support for your business owners? What tool, what one tool could you not do without?

Manny Skevofilax (18:55.054)
I would say Zoom. Zoom has been the game changer. So I try to share with my clients that, you know, this video technology is not brand new. You know, it's very old. It would, but it was only used by large corporations that, you know, had far flung overseas operations and they had full time IT people because you couldn't get it to work. And then these people at Zoom, you know, figured out how to.

Adam (18:56.883)
Ha ha ha.

Manny Skevofilax (19:24.942)
to make it so anybody could log in problem free. And then with the, you know, with the events of the last three years or so, it, it dawned on everybody, business owners, you know, the customers, consultants, you know, you don't have to drive, you know, two hours to the client, two hours back. Well, that's half your day gone. You, you can get the information that you need in a very personable,

way by just getting onto a zoom and being able to look the other person in the face and maybe it's a five minute call. So I think that's, everyone embraced that all of a sudden because you know I grew up the old -fashioned way right? We used to call to find our prospect then we want to set up a face -to -face meeting right and then the meetings would then continue in person. Well that was time consuming and it limited our bandwidth.

Now you can probably talk to as many clients as you want to in a day, just from the comfort of your own home. So that's definitely been the game changer in my opinion, in my experience.

Adam (20:35.891)
Yeah, no, exactly. And do you feel that the lessons that your clients have taken over the last three years or so, like post COVID, are going to stick? Do you think that people are going to continue to be comfortable meeting with you over Zoom rather than face to face? Or do you think the world is shifting back slightly?

Manny Skevofilax (20:54.286)
But you know, great question. In my experience so far, because everything is subject to change, you know, this this remote style has continued to be embraced. You know, every once in a while.

Adam (21:08.635)
Mm -hmm.

Manny Skevofilax (21:12.622)
you might meet a customer for a coffee face to face. Maybe, and I'm talking about the local customers. I have customers, Adam, that I never meet in person. Our interaction is watching each other on a computer screen. Before the embrace of Zoom, it used to be an out of state customer was serviced via a phone call. So I think.

Adam (21:23.795)
Yeah.

Manny Skevofilax (21:42.158)
It's going to be really hard. It might not be exclusive to always use video meetings, but I think it's going to be really hard to displace this as a tool.

Adam (21:50.451)
Yeah, no, I agree. And I think it's we're all the better for it. As you say, you can work remotely with clients, never having to see them unless it makes sense and do the job you need to and they need you to do just as well, if not better, because you've got more more productivity. Absolutely. And I'm interested in I know you said that you've worked you're obviously based in the US. I believe you're in on the East Coast in Baltimore. And then you've got experience working over in Europe. And I know.

You said that you had to travel over here quite a bit in a previous life. What were some of the major differences you noticed between doing business in the US and doing business outside of the US? It'd be interesting to hear.

Manny Skevofilax (22:31.662)
question. The first thing was the international. Presentation of financial statements they're a little different than - a generally accepted accounting principal financial statement in the U. S. so you know it's just a different presentation that you got to get used to. And then of course there's different terminology you know. For example - our friends in in Great Britain say turnover.

Adam (22:51.025)
Mm -hmm.

Manny Skevofilax (23:00.942)
and in America we say sales right. And there's a whole bunch of you know little nuances in the language which is you know very interesting. But we're all going to the same place everybody understands what a profit is everybody understands what rationalization is and everybody understands what it takes to be successful. So that's the fun part.

Adam (23:21.043)
Absolutely, absolutely. I love your choice of example with revenue turnover sales. It's because I've worked in some international companies where, and I'm sure you have as well, where you're talking about one thing, but the client believes that you're talking about something else and therein lies trouble, right? So you need to have that local language, local taxonomy and almost dictionary of terms that everyone is singing from the same hymn sheet to mix my metaphors.

Manny Skevofilax (23:26.03)
it.

Manny Skevofilax (23:39.15)
Ah

Manny Skevofilax (23:48.622)
Definitely and our overseas clients are constantly teaching me so they keep me current.

Adam (23:55.307)
Excellent, excellent. I'd be interested to understand what advice you would give any aspiring CFOs or finance professionals who were looking to follow a consulting path, a fractional CFO path. Is there any sort of tips and tricks you give them as they start out in their careers?

Manny Skevofilax (24:17.422)
Um, yeah, the first one would be to try to be patient. Uh, you know, we're, we're very ambitious, all of us, and we want our results yesterday. Uh, the first thing would be, you know, and I've learned this the hard way, be patient. Um, so you're going in to talk to a business owner and they've told me this, you know, I've, I started this business 25 years ago and it's doing great. Who are you? Is their attitude? What do you want? Some stranger has come in here.

You know, and they're like, who are you? So don't, don't get offended if that's the approach that they take, because it is a very difficult thing in my experience for a business owner to ask for help. You know, they went, they started this business with nothing. They went through, you know, hardship, took all the high initial risk. They've got it floating now, but they can't get to the next level.

And some of them don't want to ask for help. So for the new consultant, just be patient. It takes time. And remember that they don't know anything primarily about finance. We're all the financial experts. So you're going to have to be a little gentle there when you're explaining that. And just remember that it takes time. This didn't happen overnight. I am constantly learning how to do my job better, Adam, how to be more efficient.

And it never stops.

Adam (25:50.067)
That's a great approach. That Be Patient advice is something that I certainly didn't learn. I'm still working on it, absolutely, because you have, as you say, the knowledge, you know the numbers, you've done the work, and then you're going in to someone who is questioning, who are you? What knowledge have you got that I don't, having run this business for 25, 30 years? I think that patience approach is key. One extra question, I guess, a follow on from that.

is around where you've got someone in the business who is the business owner, who's asked you to come in and help, 25 years of experience, whatever, and they might have someone doing the finances, an office manager, a bookkeeper, someone who has been there perhaps a long time, believes they know the best way of doing things, has a vested interest in the owner kind of agreeing with him or her, but then you get there, you dig in, you realize that the advice they've been giving...

Manny Skevofilax (26:17.932)
Mm -hmm.

Manny Skevofilax (26:29.55)
Mm -hmm.

Manny Skevofilax (26:41.9)
Mm -hmm.

Adam (26:45.811)
is wrong. How do you deal with that quite sensitive situation?

Manny Skevofilax (26:50.796)
Uh huh. That's a great question. The first thing that I do is I, they come into an engagement and I, I tell them that I want to share the good news and the good news. And they all look at me like, you know, what is this guy talking about? You know, the good news is I'm not here to, um, take anybody's job. That's the first thing I tell them. And then the other piece of good news is I'm not here to get anybody fired. You know, this team is performing great.

You know, I am just here to see if there's anything that we can do together as a team to make this job more fun and less stressful. That's the approach that I take. So let's see what you're doing here. And I'll give you a quick example.

In the old days, you know the credit card statement will come in to the business. Depending on the size of the business, it could be 100 page credit card statement. Well, somebody would have to physically key that statement in. With the books. And then along comes this little advance where all the accounting software now let you go and do a direct bank feed and just bring it in so you don't have to type it in. Because that is a time consuming error prone exercise. And.

That was like the first thing I would say, you know what? You don't really need to be typing this stuff in anymore. You can just download it in and then you know, they're like really, you know, and once they some people resistant to change like now, like keying it in or whatever because I make less mistakes. But eventually you say, you know, give it a try and if you don't like it, we can stop doing it or that little simple win of saving them hours because that's a monthly exercise, right?

of the third or fourth day of the month, it's on their list. And eliminating that and letting them recapture all that time to do something else that's more fun, it really goes a long way to help them understand that you're there to actually help.

Adam (28:59.443)
No, I think that's exactly right. That team approach. Yeah, I like that. I'm going to I might steal that from you, man. That's very good. Well, that's it. We're all standing on someone else's shoulders, aren't we? So now I just want to move on to what I'm calling our business book bonus section. And this is where we ask our guests to provide us with a recommendation for our audience of a business book or some other type of business content.

Manny Skevofilax (29:05.814)
Absolutely, by all means, feel free. Remember, somebody taught me this.

Manny Skevofilax (29:14.286)
That's it. Yes, sir.

Adam (29:29.555)
that's helped them during their business career and they'd like to recommend. So Manny, what business book or other content would you like to recommend?

Manny Skevofilax (29:37.902)
Sure. So for my fellow consultants out there, the ones that are looking to become more efficient and become better, I would recommend a book called Million Dollar Consulting by Dr. Alan Weiss, W -E -I -S -S.

just a very important book that has completely changed the way that I do business. And I can't recommend it enough. For the customers, business owners that might be listening, one of the books, it's a small short book, but it has had the biggest impact on my career. The title of the book is called The Five Dysfunctions of a Teen.

Uh, I'm pretty sure it's over 20 years. It might be like 2002 that book came out, but highly recommend it for the business owners that are listening to the show. And it's a short read and it's amazing. And it, it, it gives you like a, a tale of a team that wasn't working good and what changes needed to be made to get that team to perform better. And it's a real shocker what the answer is. So.

That changed my life when I thought about how human beings communicate with each other.

Adam (31:05.907)
Excellent. Okay, great. We've got two good ones there million -dollar consulting and the five dysfunctions of a team I will I will put some links in the show notes for those for the audience to to find them out Well, listen, is there anything Manny that we haven't covered that you know, you'd like to say before we wrap this up?

Manny Skevofilax (31:17.646)
Excellent.

Manny Skevofilax (31:25.806)
No, I think you've asked me some excellent questions. If I were to say one thing, you know, for the fellow consultants, it would be to be patient. You know, too much pressure on yourself is really hard to, is really hard to manage. And I speak from experience. Do your best. Do not put, you know, crazy amounts of pressure on yourself. I mean, it's very hard. I understand we have bills to pay, but if you can.

not be too hard on yourself as you're starting out. It'll go a long way to helping you. It takes time. You know, my business started growing through referrals, Adam, you know, and that takes time.

Adam (32:06.259)
Yeah, yeah, no exactly. Very wise words. Thank you very much, Manny. I really appreciate you and your time, your insight and your perspective. So thanks for joining.

Manny Skevofilax (32:16.878)
Yeah, Adam, thank you for having me. I enjoyed it.