CFO Micro & Small-Cap Compensation Report JULY 2015

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1 CFO Micro & Small-Cap Compensation Report JULY 2015 Delivering exceptional talent to our partners in the Internet, tech and mobile sectors Software Internet Mobile

2 Contents Foreword 2 Approach 3 Our Findings 4 Tables 5 Graphs 6 Notes 7 CFO Trends 7 Equity Trends 7 About Renovata Partners 8 Contact Us 8

3 Foreword Renovata Partners CFO Micro & Small Cap Compensation Report July 2015 Welcome to Renovata Partners Chief Financial Officer Micro & Small Cap Compensation Report. The role of the Chief Financial Officer continues to evolve, and today s CFO has become a highly valued strategic partner to the CEO, and a highly visible executive leader internally and externally. The CFO s remit has expanded from the management and reporting of financial data, to an ever increasing focus on monitoring broader corporate performance, and driving strategic financial initiatives. Managing and leveraging data to influence key management decisions in support of corporate strategy is now an important part of the CFO s responsibilities that help ensure the future success of the business. Our research on compensation is based on assignments conducted globally by our team over the past 12 months. During this time, we have spoken with over 500 CFOs across the US and European technology sectors. These CFOs operate in a range of companies from early-stage start-ups to $1+bn multinationals across the technology sector, including AdTech, Ecommerce, Online Gaming, Mobile and SaaS, amongst other categories. We hope you find the report helpful and welcome your feedback. Rick Bank Partner Renovata Partners Renovata Partners CFO Compensation Report July

4 Approach We have gathered compensation packages from CFOs of companies of different revenue sizes. The sample spans businesses with less than $10 million, up to $100 million revenue for the purposes of this Micro & Small Cap Compensation Report. To make the comparison easier we have converted the compensation for candidates outside the EU into USD at the rate of 1.05 (July 2015) We continue to conduct more US and international assignments than in each previous year. The Trans-Atlantic searches involve relocating American leadership and talent to Europe, and identifying US talent to help European businesses expand into the US market. The information in this compensation report has been gathered from Renovata Partners' proprietary database. This provides us with a large data-set that allows us to understand in greater depth the average compensation package for CFOs across the Micro & Small Cap markets. In addition, our research on CFO compensation is based on completed searches and candidate conversations held globally by Renovata Partners over the last 12 months, resulting in 500+ CFO touch-points. Over the last 12 months, our team have researched and spoken to over 500 CFO candidates Renovata Partners CFO Compensation Report July

5 Our Findings INDUSTRY BREAKDOWN 24% 60% 16% SOFTWARE INTERNET MOBILE COMPENSATION PACKAGE RANGES Base Compensation $125,000 - $300,000 Total Compensation $146,000 - $411,000 $ 100k $ 125k $ 150k $ 175k $ 200k $ 225k $ 250k $ 275k $ 300k $ 325K $ 350K $ 375K $ 400K Renovata Partners CFO Compensation Report July

6 Our Findings BASE USD Revenue ($m) $0 to10 $11 to 25 $26 to 50 $50+ Average 173, , , ,000 Median 159, , , ,000 Lower Q 127, , , ,000 Upper Q 196, , , ,000 TOTAL COMPENSATION BONUS Revenue ($m) $0 to10 $11 to 25 $26 to 50 $50+ Average 213, , , ,000 Median 190, , , ,000 Lower Q 146, , , ,000 Upper Q 264, , , ,000 % Average 47 Median 50 Lower Q 25 Upper Q 62 Renovata Partners CFO Compensation Report July

7 Our Findings Renovata Partners CFO Compensation Report July

8 Notes The role of the CFO continues to broaden and they are increasingly relied upon as a key voice around the executive/board table. Compensation: Equity Trends No longer can private equity and venturecapital backed businesses dramatically undercut their Mid & Large Cap competitors on base and bonus by offering a slice of equity, as later-stage and public companies are now offering highly lucrative LTIP structures. Equity in mid and late-stage (i.e. pre-ipo), privately-held businesses increasingly serves as an effective tool in attracting the everdesired over-hires (defined as PE or VC portfolio company experienced CFOs who have had a prior successful exit via IPO or M&A), or CFOs from larger businesses who would bring a breadth and wealth of best practices experience, and are attracted by the opportunity to be involved in hyper-growth stories in smaller tech businesses. Please note that it is difficult to provide benchmark equity figures based solely on the scale of a business because it is important to also take into account company valuation, business maturity and risk, and equity structure. However, it is clear that the CFO typically sits within the top two to three executives from an equity award standpoint. The CFO continues to trail the CEO in equity award, but often aligns with or exceeds the COO or CRO, thereby reflecting the CFO s fundamental role in the leadership of the business. CFO Trends Today s CFO is expected to add value well beyond the traditional roles of accounting, cost management and financial control: o The role of the CFO often straddles both finance and operational functional responsibility particularly in earlier stage and privately-held (i.e. VC and PE backed) businesses; o The result is that CFOs are developing increasingly wellrounded technical, financial, strategic, operational, and commercial skill-sets; o This breadth of operational experience and responsibility is also reflected in an increasing trend for CFOs to be seen as serious contenders in CEO succession planning. It is important to note that the effective use of data has become increasingly important in the support of the decision making process within the technology sector, and in tech-enabled businesses. While both the structure and methods around the management of data are embryonic in many businesses, CFOs are often at the forefront of the drive to leverage Business Intelligence effectively in the organization, given their natural numeric disposition. Renovata Partners CFO Compensation Report July

9 About Renovata Partners New York Office: 780 Third Avenue 14th Floor New York, NY United States Tel: London Office: Great Queen Street London WC2B 5AD United Kingdom Tel: +44 (0) Renovata Partners is the leading transatlantic executive search firm focused on software, Internet, and mobile companies headquartered in Europe and the US. For 10 years we have focused on recruiting Board and senior-executive talent in those markets and as such are immersed in the dynamics of working with high-growth VC and PE-backed businesses, as well as with larger technology corporations. Our clients benefit from our collective knowledge, skills, relationships and experiences, as we operate as a single team across our international offices in the UK, Germany and US If you would like to discuss how we may be able to help you, please contact us. Berlin Office: Heinrich-Roller-Straße 16b Berlin Germany Tel:+49 (0) Renovata Partners enquiries@renovatapartners.com Renovata Partners CFO Compensation Report July

10 CFO Micro & Small-Cap Compensation Report JULY 2015 Delivering exceptional talent to our partners in the Internet, tech and mobile sectors Software Internet Mobile