594: The Art & Science of Raising Funds | Chris Mausler, CFO, PeerNova

When it comes to raising money from the investor community, finance executives often find themselves standing in line for job assignments that promise to make them active participants in the process.

Such roles allow aspiring finance leaders to check off one of the more essential items on the demanding list of prerequisites required of high-growth­–firm CFOs.

For those executives who have climbed the accounting career ladder or toiled for years in an FP&A cubicle, the “money box” is often one of the last ones to get checked off.

Such was the case for finance leader Chris Mausler, who after a decade of devouring high-calorie FP&A assignments at IBM Corp. exited the computer giant to join a string of Silicon Valley firms.

Removed from IBM’s sprawling organization, Mausler found himself in closer proximity to the action. Nevertheless, it would take years for the seasoned FP&A executive to land a role that allowed him to check that box and ultimately raise money for a variety of different firms.

“Even though my assignments had touched on treasury-type operations in an indirect way, I myself had actually never directly raised money before,” says Mausler, who last fall helped to raise $31 million in funding for San Jose, California’s PeerNova, the data governance company that he joined as CFO back in 2014.

“I’m certain that there are companies out there that make their first pitch and get funded with a term sheet, but this is not the norm,” says Mausler, who notes that most companies can expect to receive only a handful of term sheets from roughly 100 pitches.

“It's a little bit of an art, a little bit of a science for anyone going through it,” he adds. –Jack Sweeney

Mausler: As I’m sitting here at home under a shelter-in-place order, my first priority clearly is to manage our company over the next couple of months to make sure that we don’t lose any efficiency and effectiveness in meeting our short-term goals, and this is certainly a new challenge through these times. Other than that, the challenges that I have remain much the same at PeerNova. We raised a good financing last fall. We announced a $31 million round that’s going to take us for a while. We have goals and milestones for getting us through a large kind of growth round in the future. We’ve got to make sure that we get there, so it’s making sure that we’re hitting the near-term milestones and tweaking our strategy to hit the next ones.

Here at PeerNova we had good data, so it was just a question of organizing it into one place so that we could manage the business. It’s been very much of a journey for us as we’ve raised rounds to build out this platform and worked with early customers on projects to grow our business. The most critical thing at PeerNova has been to raise the right amount of capital to help to get us to the next set of milestones and to make the right set of investments to get to these milestones so that we can continue to grow the company and keep this kind of growth pattern going. At this point, having worked with a number of large institutions, we’re in that growth phase of a company where we’re ramping up revenue.

For me, it’s always been about trying to balance how quickly you grow the company to achieve the next milestone while keeping in mind how much cash you will need to manage the company until the next round. You’ve got to keep an eye on both. You want to build a company that’s growing extremely fast, but you have to reconcile this to some extent with how much capital you have. You also have to organize the milestones that you need to hit to get to the next round as well.