Not So Private Equity

S1 E2: Rick Goldberg – Founders Table Restaurant Group 

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In this week’s episode of Not So Private Equity, we welcome Rick Goldberg, Chief Financial Officer of Founders Table Restaurant Group. Rick joins us to talk about the role and responsibilities of a CFO in a private equity setting.


The Not So Private Equity Podcast is co-hosted by Ken Kanara and Steven Haug. Ken leads this week’s episode.



Ken Kanara: I’m Ken Kanara and you’re listening to Not So Private Equity. Today we welcome my friend Rick Goldberg, current CFO of the Founders Table and previous CFO of Jackson Hewitt, a PE-backed tax service business. Before we get started, I want to remind everybody that we are sponsored by ECA Partners, a project staffing and executive search firm focused on private equity. Rick, thanks so much for joining us today.


Rick Goldberg: Thanks so much for having me.


Ken Kanara: You bet, Rick. First off, let’s kind of dig in to your general background. You have an interesting path to the CFO role. I believe you started in consulting, but I would love to hear it from you.


Rick Goldberg: Yes, it’s definitely been a unique experience. This is certainly not where I ultimately thought I would be 10-15 years ago when I was starting out in my career, but I’m so happy that I found myself in the place where I am today. I started originally as a strategy consultant, I think for the reason that a lot of people select strategy consulting, which was, I really didn’t know what I wanted to do with my career. I had a sense that investment banking wasn’t for me. I wasn’t yet ready to go and do more school, and when I looked around, that kind of left strategy consulting as the only other mainstream option.

I joined a company called the Monitor Group that I absolutely loved. It was a relatively small pure play strategy shop. Our New York office was only about 60 consultants, and I worked there for several years, went back, got an MBA, and came back to the Monitor Group afterwards. I really enjoyed my time there. The company was ultimately acquired by Deloitte Consulting, which was a really good thing for Monitor, but I found that I was a better fit for the Monitor culture than I was for the Deloitte culture, which was just a much, much bigger firm.

I went looking to figure out what was going to be next for me. I have always done a lot of work in corporate strategy, specifically for CPG and retail companies, and I found out about this company called Jackson Hewitt, which as you mentioned is in the tax services space. Jackson Hewitt is the second largest provider of in person tax-prep services behind H&R Block. I went over there originally to be a Senior Director of Strategy, which is a pretty typical move for a strategy consultant to go from consulting into a strategy role and I was really fortunate.

I was promoted to lead the strategy group, and also to take on customer experience and lead that within Jackson Hewitt. But, I always really wanted to get my hands dirty in operations and I had a boss who understood that and he took a chance on me. He moved me into the company-owned operations group. Jackson Hewitt, they have 2,000 company owned stores and about 4,000 franchised locations, and I spent a little over a year working in operations as the number two to the senior vice president of the company-owned operations group, which was just a fantastic experience. At that point, we had a new CFO come in, a guy named Peter Walker, who’s now the CFO of Sterling Check, and he became a fantastic mentor for me. He came to me and he said, “Hey, I know that you’ve been doing operations. I know you’re passionate about that and I think you’d actually be pretty good at this finance thing. Come and join my team and I’ll help prepare you to be a CFO. So I did that, and he did. A couple years later when he left the firm, they were kind enough to promote me into the CFO chair.

At that point, I had already been running FP&A plus accounting, so it wasn’t a huge stretch to step into the CFO chair, but I also learned from that experience that there’s a lot more to being a CFO than just the FP&A and accounting piece of the puzzle, and that strategy background that I had as a consultant actually came in extremely handy as I took over the reins as CFO of Jackson Hewitt.


Ken Kanara: Excellent. Now you’ve moved on from Jackson Hewitt to the Founders Table as well. I want to talk about that in a second, but, help me out, because I think most of us have this vision of a CFO in our mind as the old, “Pocket Protector” finance guy with an accounting background. At least from my work, and yours too, I know it’s not that anymore. Could you tell us a little about why you think that has changed and tie it to your journey at Jackson Hewitt?


Rick Goldberg: Absolutely. I think it’s certainly true that 20 or 30 years ago, that’s what was true of the CFO. The CFO was someone who came up through the ranks of accounting, deeply understood gap and wasn’t asked to do a lot more than close the books on time and make sure that the proper controls were in place, which are extremely important responsibilities, but especially as private equity has increased in terms of their ownership of a lot of mid-market companies, the role of CFO has changed. It is much more strategic now because that’s what’s needed. If you have a 5-to-7 year time horizon to fundamentally change the operations of a company, a CEO can’t do that alone. You need somebody who’s going to serve as that right hand to the CEO, be able to bounce strategic ideas back and forth, and also be able to help drive the execution of the strategy, not just the formulation of it.


Ken Kanara: Excellent. From your perspective, it’s obviously one of the key leadership positions. Can you talk us through a day in the life of a CFO at a PE-backed company?


Rick Goldberg: I think it really varies. In my experience, a day in the life varies a ton. There are days where I spend a lot of my time focused on making sure that we understand what’s happening in the business in terms of, “What are our KPI’s, where do they stand? This number looks off, or different, or not what it should be. Let’s dig into that and understand why.” There are other days where it’s really about strategy and focusing on the long term growth of the business. There are days where M&A becomes all-consuming and it comes in fits and starts, and when you’re in the thick of it, it’s hard to find time for much else.


Ken Kanara: Excellent, okay. If you think about working with a private equity owner, could you talk about what that’s like, especially because I know from a reporting perspective, an accountability perspective, and a results and execution…could you expound on that a little bit?


Rick Goldberg: Yes. I’ve been really fortunate to work with three different private equity firms at this point.


Ken Kanara: Oh, wow.


Rick Goldberg: I think everyone is a little bit different. However, I think there is a strong desire to help the management team set the strategy and to really serve as those critical thinking partners about what’s going to be best for the business, not in terms of the day-to-day, because the expectation is that the management team has that covered, but to help think through, “What are the implications for these choices in the next six months, 12 months, three years down the line, and how is that going to ultimately impact the valuation of the business upon exit?”


Ken Kanara: Excellent. You mentioned working with three different PE firms over your experience now, could you talk us through the different models that you’ve seen? I’ve seen everything from a PE firm calling their portfolio companies “partners,” and having a very hands-off relationship, to a very heavy-handed relationship on the other end of the spectrum. What was your experience like?


Rick Goldberg: It’s interesting. I’ve seen different versions of that. I think one of the private equity firms I worked with, they were very hands-off, right up to the point where they weren’t. Once we moved into exit mode, then they were extremely hands-on and we were working with them every single day, often multiple meetings per day. Most of the time, I have a weekly call with the deal team and there will be calls outside of that as needed. That’s sort of the general touch point that I’ve always had, in giving them an update on how the business is performing, and also bounce ideas off of them to get their take on different things we may or may not want to do as an organization.


Ken Kanara: Let’s dig into that a bit. If I think about the weekly call that I have with my boss who owns the firm, usually, it’s not very formal. We both have a few topics that we want to bring up, but it’s not overly formal. What was it like in a private equity context?


Rick Goldberg: I think about the weekly calls with the private equity owners a lot like I think about the one-on-ones I have with my boss every week. Which is to say, when I’m meeting with my boss, I feel like the onus is on me to make it as productive a meeting as possible for me, because I’m the one who’s going to get the most out of it. It’s the same with the private equity team. When I’m meeting with them every week, the question is what are we going to talk about that’s going to create the most value for us as a management team in terms of tapping into the knowledge and expertise of our private Equity Partners? Then,


Ken Kanara: In that call, how much of the strategy is predetermined versus coming up with things on a weekly basis? I guess what I’m trying to ask is, is this, from your perspective, more about execution, because we’ve already got the playbook, or is this more experimentation, or does it really depend?


Rick Goldberg: I’d say it depends somewhat. You’re never going to completely reset the company strategy every week. If you do, you’ve got bigger problems.


Ken Kanara: Yes.


Rick Goldberg: However, I think there’s an opportunity to make changes to the strategy, especially, I think a lot of private equity firms come in with the playbook of, “Here’s how we think this investment is going to play out,” and it never works 100% according to plan. There are pivots and changes along the way. Then, as we experience the world in real time, and understand what’s resonating with customers, or what’s not resonating with customers, at least in the DTC companies I’ve worked for, you start to say, “Well, we thought this was a great idea at the time, but actually now we know maybe it’s a mistake and we should talk about pulling the plug or what the stage gates are going to be for us to continue going down this path,” or “We have this new insider idea and we think that there might be something there. We’re going to go and start testing it and report back and see if there’s more there that we want to go invest in and ask for financial support behind it.”


Ken Kanara:  Got it. As you think about those meetings and the overall work with PE, how do you think about success in the CFO role?


Rick Goldberg: The way I think about success in the CFO rule is, success for the CFO is success for the company. I had a mentor once who said to me, “Being a CFO is a lot like being a CEO. You’re just not compensated quite as well. Your success is the success of the company.” Every day, that’s the lens that I try to take when we’re making decisions. Sometimes things are worse off for me, or worse off for my team, as a result but if we’re making the right decisions for the company, we’re going to win in the long term.


Ken Kanara: In terms of working with private equity, in addition to the weekly meetings, did you have any other regular reporting cadences, or anything like that? Were their quarterly board meetings? Or a monthly meetings with the partners? How’d that look?


Rick Goldberg: We’ve always had quarterly board meetings with a combination of the private equity owners and then, oftentimes, they’ll bring on independent directors, as well. Subject matter experts who can really help in some of the key areas of need for the organization. Honestly, that’s one of my favorite parts about being a CFO, getting to play a leading role in those meetings. Part of my personality is being on the hot seat and getting tough questions and preparing for tough questions. I think I’m the rare individual who looks forward to board meetings.


Ken Kanara: Yes. We all remember from our consulting days, you’re in trouble if you don’t know the numbers, right? The CFO’s got to have all the answers, I would imagine. If you think about the role, what’s the best and worst part of it?


Rick Goldberg: I think the best part for me is making a difference in the organization and feeling like decisions that I’m helping champion or make are helping to make the company, our customers, and our employees better off. I think the worst part, for somebody who is not coming up through an accounting background, is there are times where I have to get really deep in the weeds on accounting matters. Whether it’s reconciliation, or gap interpretation, that stuff’s a little bit less interesting to me, but it’s an important part of the job as well.


Ken Kanara: One other thing that I’ve observed is with private equity specifically…does the CFO need to be strategic? Do they need to be operational? Do they not need to understand finance? Do they need to understand M&A and transactions? Yes, yes, yes and yes, but the one thing I’ve continued to observe is that the CEO can get away with not having that deep of a finance background. I guess where I’m going with this question is, because accounting and finance is becoming less of a focus for the CFO, how do you feel that gap is being filled, given that the strategic nature of the CFO role is evolving?


Rick Goldberg: I’ve always felt like my role as CFO is to be a partner to the CEO. I have my gaps in terms of what I’m good at, and every CEO has his or her gaps as well. But you try to set yourself up so that you can work well together and cover each other’s blind spots. I think the same thing holds true with the CFO and his or her, number two. One of the things I look for when I hire a Chief Accounting Officer is somebody who has a deep technical accounting background because that’s not something that I come from and I need somebody who can be that voice in the room.


Ken Kanara: That makes a lot of sense. For those of us not familiar with the Chief Accounting Officer role, what is that and how does that support the CFO?


Rick Goldberg: The Chief Accounting Officer role is actually a lot like what the CFO role was 20-30 years ago, like we were talking about before, that person who came up, oftentimes through a big four firm, and is really steeped in accounting knowledge. But from me, in my experience, that’s the person who’s leading the core accounting, technical accounting, tax, treasury, accounts receivable, accounts payable, internal audit, all those core finance functions outside of FP&A.


Ken Kanara: Okay, that makes a lot of sense. The CFO’s really kind of bridging the gap between that and the overall strategy of the company, and the CEO and what have you.


Rick Goldberg: Exactly. I’ve been fortunate in my career as CFO to have, what I think is a pretty typical mandate of a private equity CFO, which is you’re not just running finance and accounting, you’re also leading strategy, real estate and development, franchise sales, human resources, some of the back office functions that might have in the past reported to a CEO, but today oftentimes report to a strong CFO, particularly in a private equity environment.


Ken Kanara: Excellent. That makes a lot of sense. From Jackson Hewitt you went on to your current role at Founders Table. I know Rick that you don’t have a background in restaurant work. Well, actually that’s not true because I know that you were also an entrepreneur and started a business called City Wine Tours, but how does one make the transition from a business services company to hospitality and restaurant.


Rick Goldberg: I think the one big thing that both Jackson Hewitt and Founders Table have in common is that they are multi-unit retail and private equity-backed. Yes, doing a restaurant is very different from running a tax shop, but at the same time there are elements of how to look at the business and how to look at a multi-unit retail business that are very similar. For me, I had always wanted to go and work in fast, casual restaurants. This was a dream of mine for a very long time and I always tried to position myself so that when my time was up at Jackson Hewitt, and I was there for almost seven years, that I would be able to land a role in hospitality and in fast, casual restaurants, hopefully. Every once in a while in life our plans work out and that’s what happened to me there.


Ken Kanara: Absolutely. That makes a lot of sense. Thinking more broadly about your career, in the beginning of the show you mentioned that you never really thought that you’d be CFO or that was not necessarily your intended path. If you were talking to someone that is early on in their career and actually knows that this is the path they want to take, the private equity, CFO route, what advice would you have for them?


Rick Goldberg: I think my advice, generally with careers, is to always be open to new experiences. If I had set off on the path that I thought I was on 10-15 years ago, and had been unwavering about it, there’s no way I would have wound up where I did today. I was open to new experiences. I was open to trying operations. I was then, open to moving into a finance function and ultimately, that actually got me where I wanted to go, which was a c-level position at a fast, casual restaurant chain.


Ken Kanara: If you take someone like…I’ll just use me as an example because I have zero finance experience, but I came out of consulting, similar to you. Where do you feel is the biggest disconnect from a management consulting, strategy background person like myself, and then having the finance wherewithal. What are we missing?


Rick Goldberg: I actually think that the strategy consulting background is hugely beneficial for someone looking to move into the finance side. I think that, increasingly, if you look at where people are drawing FP&A talent…FP&A talent is often coming from strategy consulting, investment banks, hedge funds, or private equity firms. There’s a huge appetite for raw intellectual horsepower, which management consulting is often a pretty good proxy for in FP&A rules. Overtime, I think one of the most important skills to acquire, if your ambition is to get to the C-suite, is to be able to lead functions that you don’t have a deep expertise in. Ultimately, when I took on the accounting function at Jackson Hewitt, that was the first, real, time I had that challenge. It was a huge challenge to go into meetings where the most junior person on the team knew 10 or 100X more about the subject matter at hand than I did. But I’ve found that a lot of life is just about asking, whether they’re smart questions or stupid questions, being willing to ask the questions that no one else is asking, can actually get you pretty far in those situations.


Ken Kanara: I think that makes a lot of sense. Given that the theme of this show is all around the misconceptions associated with private equity, I think one of the things that I’m hearing today, and I’m going to try to summarize it, but you tell me where I’m right and where I’m wrong, is it sounds like working with private equity in a CFO context is a lot more strategic, operational, and execution-focused than necessarily having the accounting and finance background. However, that is important. The other thing is that, from a reporting point of view, it’s really important to know the numbers, given the pace at which you’re working with private equity. Is that a fair synopsis?


Rick Goldberg: One hundred percent. I think that’s exactly right.


Ken Kanara: Okay. Something I forgot to ask and I’m curious about, is when you think about reporting and those quarterly board meetings, you mentioned operational KPI’s. It was previously my understanding that CFO’s own the numbers associated with finance, but you mentioned operational KPI’s. Talk to me about the reporting there and the expectations from the PE owners.


Rick Goldberg: Part of my philosophy around FP&A, which I actually got from a former boss of mine, Greg McFarland, who was previously CFO at Casper Mattress and at H&R Block, is that really, the function of FP&A, more than anything else is to help the business make smarter decisions using data and analysis. Part of the way that I’ve tried to shape my FP&A teams is to really help our business partners, whether in marketing, in operations, or in other parts of the business, human resources, understand what’s happening in their function and help them make better decisions.

One of the best things I’ve been able to do at Founders Table is we have a weekly meeting with the leaders of the operations team, all the regional vice presidents, and my FP&A team. We walk through the numbers together and we talk about what we’re seeing. Sometimes, from the FP&A side, we’re seeing things in the numbers that they may not be aware of that are happening in the restaurants and vice versa. Sometimes we think we have some great insight and it’s like, “Oh no, actually here’s what’s happening in the restaurants themselves,” but that’s really valuable as well because then we know when we’re talking to the board and to the private equity owners, “Hey, you’re going to see this in the numbers, here’s what’s actually going on.” Then we don’t have to wait until month end close, or some reporting period, to be able to have that insight into what’s going on.


Ken Kanara: That makes a ton of sense. I really like how you put that, well, I think your former boss is the one that said it, but “to enable the business to make better decisions.” I think that really sums up the CFO role. Excellent. The last thing I’m curious about is whether or not you think the CFO role is also a good training ground for future private equity port co.’s CEO’s as well.


Rick Goldberg: I hope so, because that’s the journey that I would like to be on longer term, but I think anytime that you’re in the C-Suite and you can position yourself as a strong right hand to the CEO, I think both the CEO and, hopefully the private equity owners, will look favorably upon that. That’s what I’ve tried to do in my career and we’ll check back in, in five or ten years and see if I was successful in that.


Ken Kanara: Yes, you bet. Rick, do you have any closing thoughts or anything that you want to share with our audience?


Rick Goldberg: The one closing thought I have is for people who are skeptical about the CFO track, as admittedly, I was before I went on it, I think it is a really fantastic way to get into the strategy side of a private equity portfolio company business. That strategy piece is so important today in a way that I really don’t think it was 15-20 years ago, or even longer. That’s number one. Number two is to constantly be building that relationship between the CEO, the CFO, and the private equity owners. That’s the relationship where you’re going to be able to move quickly or slowly, depending upon how much trust is there, and you’re building up a store of trust for when you need it,  because as we know, business has its ups and downs. Sometimes it’s smooth sailing, but it never lasts all that long.


Ken Kanara: Excellent. Rick, if anybody wanted to get in touch with you or learn more about Founders Table, anything you’d like to share, either LinkedIn or website, or anything like that?


Rick Goldberg: If anyone has any questions, wants to follow up, please reach out to me via LinkedIn. Rick Goldberg, CFO of Founder’s Table.


Ken Kanara: Excellent. Thanks so much for joining us today, Rick. Be sure to check out eca-partners.com if you want to get in touch with me, as well as check out our other podcast, Beyond Consulting. We’ve got close to 50 episodes there. Until next time, thanks so much and thanks for listening.



Connect with Rick on LinkedIn and visit www.founders-table.com for more information.



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