Ed Schaffer and I worked together while at Hired – a high-growth tech company that at a time was experiencing growth but soon was staring into the eyes of a pandemic storm and in the center of this storm was the HR Tech / Talent Marketplace industry that Hired was in. Ed’s ability to manage through crisis was what ended up helping in an acquisition by the end of 2020.

Ed was the CFO and I ran North American Sales, so we were tied at the hip with several strategic initiatives including a reimagining of a subscription pricing model in an industry that was used to consumption pricing. In working with Ed, I realized he was more than a CFO but had a rich history in operations, so when it came to thinking through who I can speak with for Lightbulb Moments, Ed bubbled toward the top of the list of someone who had good stories to tell.

Lightbulb Moment – The Turn Around Artist

Ed’s professional journey started in Strategic Consulting with Andersen Consulting (now Accenture) and then at the pharma giant Glaxo Smith Kline (GSK) which had a full-time, three-year program in their internal business consulting and audit department. It was during this period that Ed started to get a taste of the business world and saw that finance was essentially the “language of the business world” and decided to go back to business school.

Ed graduated with his MBA from Stanford and after a stint running his own startup, he decided to take a job at Intuit where one of Jack Welch‘s proteges from GE just took the CEO job. Jack was at the helm of GE and led the company to an unprecedented run of dominance and financial success (1981-2001) and recently has become controversial for his draconian methods of leadership on working hard, lest they get fired. Nonetheless, taking a job in 2000 with a Welch protege was a big deal regardless of whether this style would resonate 20+ years later.

“It was a heavy emphasis of connecting the strategy to the execution because strategy in itself is not good in isolation. I learned that you have to be great at operating execution and this set a solid foundation for me going forward.”

Within the first few years at Intuit, Ed had been recognized for spotting some deals that were going to go belly up and he was able to provide guidance and saved multiple millions for Intuit. This recognition earned him a spot to be a part of a team in an underperforming group and turn it around.

“This was a team that was viewed as an internal conflict of interest to the main, mothership product QuickBooks, as it was a partner affiliated network that were building solutions that were seen as a conflict. We were in the bottom 20 of the 200 teams at Intuit. So this was my first turn around!”

Within 7 months, Ed ascended to a VP title, changed the strategy around how they executed which aligned to work better with the internal QuickBooks team, and ultimately became a top 10 ranked team within the company.

“Our strategy was backward, it wasn’t cooperative with the QuickBooks organization. We weren’t looking at it through the right lens. As opposed to just trying to sell more QuickBooks, what if we started to work with our network of developers and create verticals for the product? When you talk to the customers, you learn that anything that touches the cash and turns it into more cash is far more important than the accounting itself. Customers started to pay a premium for solutions within our Developer Network and we put the best developers that rose to the top that surrounded a particular vertical or segment that offered a complete offering with QuickBooks at the center.”

This was the first “turnaround” for Ed and one that marked the start of a unique specialty he began harnessing for himself. In the tech world dominated by “growth at all cost”, Ed began to carve out a niche for himself to manage not only through growth but through a crisis.

“When you’ve already got an established product and you’re bringing on new concepts and strategies, you have to also look about things in a different way. It’s a network of services, not a product, so you have to look at your go-to-market strategy differently and require an entirely different way of thinking than what worked prior.”

Ed explains further that the culture at Intuit put you in a certain box and told you to operate a certain way, within the confines of box, perform a certain way and if you do this for some time without any deviations, you can get in the promotion conversation.

“My view was that if I put people in a bigger box and give them the latitude to find new solutions, they end up covering much more ground. I don’t hire people who already have done the job you’re asking them to do, because if that happened they would be bored in a heartbeat. So I gave my team a chance to step up and they were excited about it.”

Lightbulb Moment – The Turnaround Mindset

After a few more turnaround success stories, Ed started developing his voice within the PE and VC world as a “Turn Around Expert”. This led him to start his own blog that spoke about the Turn Around Mindset.

“I believe it’s good to have someone with a turn around mindset within any company. You’re more thoughtful about where you spend your money, you focus on the investments you’ve made and the discipline to see them through for smaller, incremental gains. It’s counter to the traditional Silicon Valley mindset of moving extremely fast when you’re flush with cash, which finally seems to be no longer the pervasive mindset, but this type of thinking was a little ahead of its time and controversial in some respects.”

Aside from a mindset, there were a few tricks and tools Ed speaks about in his turnaround arsenal.

“13-week cash flow, literally looking 13 weeks ahead for a projection. You look at a very short-term horizon and your accuracy is going to be that much more accurate. Looking at your cash flow on a shorter horizon, seeing the collection of bookings and the patterns associated, forces you to be that much more disciplined. It’s helped the focus of certain turn arounds and it’s one of the tools that I’ve used with a lot of success.”

Ed has gained a reputation for his turnaround specialty, where he ended up working alongside quite a few turnarounds, and partnered with PE funds that are looking for this expertise through various organizational reorganizations as well as mergers and acquisitions. This has become Ed’s professional identity and niche.

“There’s something about when there’s a crisis, I become more focused but you have to do things with a heart. This is a people business and while you’re making these tough decisions, you have to ensure you have their best interest in mind.”