Engineering Outcomes: What CEOs Should Expect from Finance Leaders

Megan - 00:58: Today, I'm excited to be joined by Todd McElhatton, Chief Operating and Chief Financial Officer at Zuora, where he oversees finance, operations, M&A, IT, legal, HR, and strategic partnerships. With more than three decades of experience leading global finance and operating organizations at companies like SAP, Oracle, VMware, and Hewlett Packard, Todd brings a rare dual lens perspective on how companies scale, transform, and grow. Most recently, Todd played a key role in Zuora's $1.7 billion acquisition by Silver Lake and GIC, guiding the company through its transition to private ownership. His career places him right at the center of one of the most important shifts happening in leadership today, the evolving relationship between CFOs and CEOs. Today, we'll explore how that dynamic is changing as companies head into 2026, why it matters for growth, and what today's finance leaders must do to become true strategic partners in an increasingly complex business environment.

Megan - 02:01: Todd, thank you so much for being here with us today.

Todd - 02:03: Thank you, Megan, for having me. It's good to be here.

Megan - 02:06: So you've held Senior Finance and Operating roles across some of the world's largest technology organizations. Looking back, what moments early in your career most shaped how you think about the relationship between a CFO and a CEO?

Todd - 02:21: I think one of the things that I was really fortunate, especially when I think about my days at HP, there was a lot of mentoring that was going on. But what was really helpful for me was not so much of an exercise of, hey, let's do a spreadsheet exercise and let's roll up what the numbers were, but really an encouragement to understand the business and understand what was happening and how finance could help engineer an outcome. And I think that has really stuck with me. And I remember one of the pieces of advice is that one of my early mentors gave me. And it was a new business that was going, and as a junior finance person, I was really stuck on, hey, we've got to make X and Y returns, and I was really thinking about it, every single transaction had to be profitable. But as you think about it, you got to get a business off the ground. You got to take some risk. I think maybe he was a bit frustrated, and he said something to me that stuck with me through my whole career was, Todd, if I don't sell anything, you're not going to have anything to count. And that really epitomized to me, it's like, look, working in finance, you need to be a partner with the different areas of business and need to help them achieve a shared objective. As that's really stuck with me, I think that's something that's really important for all leaders to have is, how do you work together to get to that same outcome, that same shared objective?

Megan - 03:35: And if you compare the CFO CEO relationship early in your career to what you see today, what's the most striking change that stands out to you? How have you seen that relationship evolve over the last one or two decades?

Todd - 03:51: I think the biggest thing that I see that's changed over my career is the CFO has moved from telling people what happened to really help engineering what's going to happen, not only in the future quarters, but setting the strategy and the foundation in place for the next several years. And one of the things that is unique about the CFO world, it's one of the few roles in an organization that truly has end to end visibility of everything that's going on. And the most impactful CFOs really understand the cadence of the business and what the operating levers are. And so as they're able to have that conversation and when I think about a CEO, there's not a whole lot of people that have that same end to end visibility. The CEO and the CFO are also usually the two people that are sitting with the board. They're sitting with investors. They're sitting with lenders, and they're having to explain what's happening with the company. Did you make your numbers? Did you not make your numbers? How quickly can you grow? And you have that shared bond, and that just mutually puts you in a space where how do you work together? And I think as you develop the confidence, each of you are able to depend more and more on each other, and you just see that bond growing much tighter.

Megan - 05:04: And at Zuora, you serve as both the Chief Operating and Chief Financial Officer. So how does wearing both hats change the way you partner with the CEO on growth, trade offs, and long term strategy?

Todd - 05:16: I don't know that it really changes it. But as you said, not only do I oversee finance, but I own M&A partnerships, IT, legal, HR. And I said this to Dean when he hired me. I said, at the end of the day, there's three types of CFOs. There's the accounting, someone who's come through accounting. There's someone with an investment banking and a deal person, and there's an operating. And I'm an operator. And so I've always been in my career, how do I help the different areas in the business? How do I closely partner with them to achieve the objectives? So I think from my standpoint, it's allowing me, since I own all those functions, we can move much more faster. I can make the decision in much quicker time frames than maybe I could before I had those functions that I had responsibility for. But in general, I don't know that it's changed a whole lot other than just our agility and speed to move forward because I've always worked very closely, not only with the G&A functions, but all the other functions whether it be go to market, product, or sales in the organization.

Megan - 06:13: And as companies now head into 2026, or I guess we're one month in now, growth feels less linear and more uncertain. So how have you seen CFOs move from being financial stewards to becoming true co-architects of the company's direction alongside the CEO?

Todd - 06:32: I think one of the things that I'm constantly doing and what we're seeing is there's so much data that's available and making sure that you have visibility to what's happening in real time. What are we seeing that's happening with our pipeline? How is that growing? How do we interact with our customers and partners? What are the data points that we get that really allow us to put together a plan that is reasonable and also takes into account what's happening in the current environment? And I think, as you said, what we've seen is conditions can change very quickly, and so being able to have multiple contingencies when things do shift and have an incredible way that you can shift when the market shifts and demand increases or decreases so you can still make the commitments that you've made to your investors.

Megan - 07:16: And can you maybe share an example perhaps during Zuora's transition to private ownership where a strong CFO CEO partnership made the difference between a good outcome and a truly great one?

Todd - 07:31: One of the things that go back and reflect, one of the things that you see is you'll see opportunities that can start percolating along where all of a sudden you weren't thinking that a certain product was going to maybe have the reach or the ability to grow as quick as it can. And as you're talking with people, and I happen to have the fortunate in my role that I spend a lot of time with customers. And so I know, for example, in the most recent year, we have a product that we started to release. And one of the things that really resonated with me was the collections product that helps us be able to collect faster and much more efficiently from our customers. From my standpoint, I was like, wow, I can certainly see the value of this as a CFO. We use the product. It's really improved our ability to collect and to bring in cash much quicker. So from my standpoint, it resonated. It had a really quick time to market. And as I started talking with customers, which is something that I do on a regular basis, it was also resonating with them. So as I was going through sales reviews and chatting with our leadership team, it's like, why aren't we pushing this more? And one of the things that we found is, hey, the product did absolutely resonate, and that was a spot where because of my unique visibility and what I saw, we were able to probably put more wood on the fire and let it burn faster, and it was a product that's going to have a much greater impact to our overall financials than maybe it would have if I had not been as engaged with it.

Megan - 08:53: And in your experience at SAP and now at Zuora, how is the CFO's role in shaping commercial strategy, pricing, and customer models deepen the partnership with the CEO? Those are all things that maybe a CFO would not have participated in ten, fifteen years ago.

Todd - 09:12: I think one thing that's really interesting, both at SAP, a lot of my tech company experience, and at Zuora, pricing is a function that does live with the CFO. One of the things I think is unique again about the CFO role is you're the honest arbitrator of what's happening in the organization. You have an understanding of when we make adjustments in pricing, what are the downside impacts of that? As you start taking a look at what might be the consequences of making changes, whether those be good or bad, that you have a full view of that, that you have the data oftentimes that you can move from moving something rather than, a gut feel, but you got data behind it. And so when I take a look at having the ability to understand, first of all, do we have the systems and processes in place and technology that we can implement this pricing? Do we understand what impacts or consequences it may have that we hadn't considered? And then ultimately, what are the data points behind how we're making this decision? And finally, how does that lay into our financial plan? Again, it's your unique from your ability to help advise and make sure that those changes are really well thought out and deliver the outcome that you're looking for. But again, I go back to pricing is not something that's done in a bubble. It's something you need to work really closely with your product teams. You need to understand what is the cost of the product that's coming up. You need to understand with your go to market teams, how quick can they get the message out, what do they think the market size is, how does the competitive landscape work. So, again, it really is making sure that you're being inclusive and bringing in those relationships with all the other impacted functions within a group.

Megan - 10:46: And given our discussion, I'm curious about two things. One, how did you become an operating CFO? Like, did you step outside of finance for part of your career, or how did you become familiar with operations? And we'll start with that one first.

Todd - 11:04: I think where I really became more of an operating CFO was when I was at HP, and I owned the pricing function for part of the business that was an outsourcing piece of the business. And so what we were doing is we were going in and think about really large Fortune 500, Fortune 100 companies where we were going in, and we were hiring their employees. We were buying all their assets, and we were running their IT systems and charging them back for that. And so these were $2 and $3 billion transactions over five to ten years. And so it really became incumbent for us to price those is to understand exactly all the mechanisms that happened, and so you had to absolutely understand all the assumptions it was that were going to be taken into account to run that business. And so the very first deal that I priced, I was really proud of myself, was the biggest deal that at that time HP had ever won. And about six months into it, the general manager of the business came to me and said, Todd, what in the world has happened with this deal? This deal, we're losing a boatload of money, and this isn't what you said you were going to do. And I was like, I don't know what's happened. He said, can you take a look at it? I got engaged with it, and what had happened was we made a set of financial assumptions. And we closed the deal, and people parked the assumptions on a shelf somewhere, and nobody looked at them. And they just went and ran the business, and they didn't do what the transformative things that we needed to do in that account. And so I ended up having to spend the next six months working with that team to put that back that account in line and doing what we said we were going to do, and we're ultimately successful at doing that. But it was a really good lesson for me, and it's where I learned that, all right, here are the assumptions we made. I had to work with the team to implement those assumptions and make sure they actually turned into reality, and we got the returns that we needed. So it was a good lesson for me. I think it was a good lesson for the business, and it really taught me how to make sure when you're building these models and you're thinking about how to run a business that you do understand all the levers. And there's going to be assumptions that work. There's going to be assumptions that don't work and making sure that you've got enough levers in there that you're never going to be able to look ahead and pick everything that's exactly going to happen. But if you're skillful enough at it, you can leave yourself enough levers to adjust for the things that are unknown or maybe don't turn out the way, and you're going to have some things that work your way and some things that don't work your way, but just being thoughtful and prudent about how you model those.

Megan - 13:22: And my second question is, in your role at Zuora, you must have a lot of conversations with CFOs. So what challenges are you hearing from them?

Todd - 13:32: The biggest thing is and you're right. I probably talk to maybe 20 CFOs a month, and those may be public companies, companies that are getting ready to go public, people that have just transitioned into a private company. They're venture backed companies. And the biggest thing that I am hearing from CFOs is, while there's this tremendous amount of change that's going on, I think AI is a great example where it's impacting the speed at which businesses are done. But more importantly, companies are changing their business models, and they're changing their business models at paces that we've never seen before. And so where products used to be shipped, now people are saying, well, I want to buy on consumption. Maybe I want to buy on a specific outcome, and CFOs are having to manage this. They're needing to make sure they've got the systems and processes in place. So when somebody from product marketing comes up with this great idea that instead of selling an end product, we're going to sell it based on an outcome, that we have a way that we can actually track it, that we can make sure that we have a way to measure it and recognize the revenue and get a bill out to a customer, and that's going to be credible and that our auditors are going to accept. And so they're having to sit there and navigate through these very rapid product changes and these very rapid changes in operating environment, and they're needing to make sure that their businesses are tooled not only for what products they have today or next quarter, but they're able to compete in the next few years. And so I think that's been a big change for a lot of CFOs, and that's probably one of the things that's top of mind is, how do they keep their business so it is agile enough to adopt to the changes that we're seeing.

Megan - 15:07: And I'm not sure if you can share or not, but where is Zuora investing in the future? Especially for technology, things seem to be changing very quickly. So I'm just curious to know where you guys are investing, especially given AI.

Todd - 15:22: So AI is at the top of our list for places we're investing. We see AI as an opportunity not only to improve our product, but it's an opportunity for us to operate as a company much more efficiently. We're using AI so we can get customer time to value at a much quicker rate than we have been in the past. We're also able to provide a much better level of customer satisfaction. We're seeing things that maybe took us in the past three and four weeks to accomplish for our customers that we're able to accomplish in days. And so that's giving our customers much better outcome. It's giving us much better economics, and it's able to it's something that we could share with both our customers and our shareholders, which is a good outcome.

Megan - 16:04: And with your experience leading Zuora through private ownership and your perspective as a board member at Teradata, how do you see the CFO CEO partnership changing once private equity or a more hands on board becomes deeply involved?

Todd - 16:20: My experience with the CFO CEO relationship has been the following. First of all, I mentioned earlier, you've really got this unique visibility of what's happening in the company end to end. And so as you think about that and the challenges that you have as both the CEO and the CFO, you're in this together. You've got an outcome that you deliver. When you're talking to investors, when you're talking to board members, it's often only the two of you that are in the room with those constituencies. So I think you've got a lot of aligned and shared outcome that you own. And so it really becomes it's a very logical relationship to have. How do we partner more closely? But I think the fact that you do have that visibility of what's happening in the company, you can have very direct conversations about things that are going well or not going well. From my perspective, I think one of the things that CEO and I do on a regular basis, Dean and I, I'll have a conversation. It's and it may be things that people say, well, that's really not your swim lane. And my point of view is, look, my swim lane is we need to deliver the outcomes that we promise to our investors, and I think that's no different whether you're a public company or a private company. And so as you have those observations and you see things that are going well and you want to do more of them and you want to do them faster or you see something that maybe is off track, it's being able to have that conversation and batting around what are the ideas to move faster and make changes, and you just ended up having a much better outcome. And I think, my perspective, it's been super enjoyable for me to be able to have those conversations with a team. I think from his perspective, it's also invaluable for him to have a partner that's thinking about the business the same way. You can bat ideas around, and there's some ideas you're like, okay, maybe that's not a great idea, or maybe, hey, that's a really good idea. We can make it better by doing different things. So I think, having a shared partner that's also got the same visibility and set of facts that you have really does help you make better decisions. And so that's one of the things I think has been key to my relationship between our CEO.

Megan - 18:24: And you mentioned swim lanes. So what tensions or friction points tend to emerge in the CFO CEO relationship as company scale, and how can leaders address those more proactively rather than reactively?

Todd - 18:38: I don't know that I would call them tensions. I think, for me, I was very intentional when I took the role. And I think anybody that's going into a CFO role, it really is important to get to know who you're going to be working with. And I think that interview process and that process where both of you are vetting each other out and you're checking references, and I think both parties are doing that. How do you work together? Do you have a shared view of how you want to run a company, what the outcomes that you're looking for, how you get those? I think that's really important, and I think that's one of the things that makes for a successful outcome. So I don't know that I look at it as being tensions. I think it's, do we have a shared set of objectives? Do we understand what we want each other to do? Are we aligned on what level of partnership do you want? For me, it was really important to work with someone that did want me as a partner. It was really important for me, and I think when decisions are made, myself and the CEO are usually probably the last two in the room. And to me, that was something I think that was important to both of us. I think it's been really beneficial to the company, and that is one of the things that has led to us having, I think, a really productive and successful relationship.

Megan - 19:49: And as more CFOs take on operational responsibilities, how should CEOs rethink what they expect from their finance leaders, and what does that mean for decision making speed and accountability?

Todd - 20:02: I think the one thing that you need to be expecting from your finance leaders is they need to show up. And, first of all, do they have a good understanding of the business? Do they have an understanding of when you take action and pull a lever, what does that mean? And like I shared earlier, I think you're seeing more and more CFOs have come through a career where they partnered with different businesses, and they do understand the levers in the business. And I do understand when I pull something, what are the consequences? How long does it take? How does that move through the system? And so it's not just a spreadsheet exercise, but they truly understand the cadence of the business and have a good idea of what the different outcomes can be. So I think having a CFO that understands that can work with the different factors in the business, has data that they are looking at in real time, and has the agility to be able to make decisions and you see things happening is a whole lot better than looking back and like, oh, wow, this happened to us. And so that's one of the things that I think you're seeing that's being expected of CFOs, and that's really how the relationship I'm seeing has changed over the past several years.

Megan - 21:06: And I'm curious, given the close relationship these days between CFOs and CEOs, I'm assuming the answer is yes. But talk to me about, like, how you're seeing CFOs maybe take on the role of the CEO. And for CFOs who aspire to be CEO someday, how would you recommend that they prepare for that?

Todd - 21:26: I think one of the important things of any senior leader is, a few things. One is spending time with your customers, really understanding what do they value, why are they buying from you, what works, what doesn't work. And that's a really good help you make decisions on how you want to allocate capital. I think the second thing is going beyond the numbers, really understanding how each function works. What are the constraints? How do you stress test? I'm never going to replace one of our engineers from a coding perspective, but I need to be able to ask enough questions to see if maybe something's going wrong. And I need to be able to triangulate to say, okay, this seems to be working. This is good, or maybe this is an area that there's something festering here, and I need to dig down deeper. And I think the last thing is, how do you work well with other members of a leadership team? And from my perspective, a really important part of that is being transparent. I think it's really helpful so everybody and I believe this. I'm radically transparent. We don't have hedges on our numbers. People know exactly where we stand. They know exactly where we need to land, and they understand the levers that we have. And I think that's really helpful when you need to make tough decisions and people know that, all right, there's a degree of trust that we've committed to something. And in order to achieve it, we're going to have to maybe make a hard decision. And so that everybody has that and sees how the decision made really helps the team work much together. So I think those are some of the advices that I would give somebody looking on a leadership team, whether they want to advance to a CEO role or they just want to be more effective operationally to do.

Megan - 23:04: And last question, and maybe you just answered it in part, but what skill sets or mind shifts are going to be necessary for the future CFO?

Todd - 23:16: I really think the future CFO, their job is to engineer what is the outcome that the organization wants. So it's really, all right, we have a vision. How do I help bring all of the folks together for us to achieve that vision? And, again, the fact that you have the data that you have, that you have the insights, that you can see things that are happening in real time, you can see the picture from end to end, you're really uniquely positioned to help the company achieve that objective. And I think that's what the most impactful CFOs are doing, and I think that's what CEOs and boards are looking for when they're bringing on leaders. They're not looking for someone to tell them what's happened. They're not looking for someone to say no, but they're looking for someone to partner with the business to help them achieve that objective that the company has.

Megan - 24:02: Todd, thank you so much for sharing such candid insights from your journey across public companies, private ownership, and the boardroom.

Todd - 24:09: Thank you, Megan. Enjoyed speaking with you this morning.

Megan - 24:12: It's been a pleasure speaking with you as well. And to all of our listeners, please tune in next week. And until then, take care.