How to Be an Amazing Financial Consultant

How to Be an Amazing Financial Consultant

Fewer than 3% of applicants make it through Toptal Finance’s rigorous screening process. How do the best of the best become such effective financial consultants? We sat down with one of Toptal’s most on-demand financial consultants, Jeffrey Fidelman, who shared his proprietary methods for ensuring success for his clients and how he has grown his own business exponentially.

Executive Summary

What are some keys to being a successful financial consultant?
  • Listen. Ask a lot of questions and really listen to what the client (potential client) is saying. By the end of an hour-long phone call, you should know exactly what the client's business is all about and what challenges they're facing.
  • Challenge. When working with a high-level executive, don't be afraid to challenge their assumptions. It's far better the challenges come from you than when they're either in the marketplace or in front of high stakes investors.
  • Act as a partner, not an employee. Don't just let the client hand you tasks to do, try to collaborate as much as possible. The best relationships are true partnerships where both sides are lending and feeding off each other's expertise.
How do you ensure success for your clients?
  • Arm the client with thoughtful research. An important part of being a financial consultant is making sure a client has an answer to every single question that might be asked regarding a project (whether it be M&A, fundraising, new growth strategies, etc.). This is, of course, substantiated with market research, valuation, etc. You're not just trying to force them to vocalize an answer and run with it. You're working towards getting the right answer together.
  • Collaborate. Instead of simply telling clients what you think is best, try to have a back and forth discussion. For pitch deck creation, for example, try to have the client as involved as possible. You could just create the entire deck for them but the clients that get more involved tend to have a significantly higher success rate.
How do you handle difficult clients?
  • Try to avoid clients and projects that aren't a good fit from the beginning.
  • Measure your own success by how successful your clients are. Take the interview process very seriously and if you don't think you can help, try to find out as early as possible and opt not take the engagement.
How do you grow your book of business?
  • Go the extra mile. Spend that extra 10-20 minutes on the interview call and don't be afraid to give the potential client something for nothing—that way they walk away from the initial call having received something of value.
  • Create a repeatable process. Try to learn from past engagements and create a standardized process that can be repeated. Of course, the process grows and gets edited with every project and therefore, your value-add keeps growing too.
  • Be honest with the client and yourself. If you don't understand the client, ask, then ask again. If you don't feel like you have the right skills for the engagement, tell the potential client and stop the interview. "Toptal is an incredible marketing machine; there will be other opportunities." - Jeffrey Fidelman, Toptal Finance Expert

Toptal Finance is chock-full of the best financial consultants in the world (Toptal really only admits the top 3% of applicants, after all). But how did they become so great? What do they do differently than their peers? Jeffrey Fidelman is one of Toptal’s most in-demand financial consultants so we sat down with him to pick his brain in search of greater wisdom. Read on to find out why clients love him, how he created a repeatable process, and what resources he uses to ensure success. He even shared his proprietary pitch deck creation guide available here which has proven to have an extremely high success rate.

The following responses are Jeffrey Fidelman’s. Editor comments are in italics.

Expanding the Breadth of Services Offered: “Oh, you can help me with this, too?”

The projects on Toptal that I engage with have changed from when I started on the platform over a year ago. When I started, I could place projects into three buckets. Some were either modeling or revision of models. Another group was presentation construction, narrative advisory, fundraising, and collateral. The other bucket was a miscellaneous group of business advisory. Business advisory included things like “I have a semi-profitable business and we have revenue, how do I grow? Do we use financing, debt, do we raise money? If we do raise money, what’s the structure?” Essentially, I was playing the role of a banker. We would consider raising under pure equity or convertible debt, I would put together convertible note calculators, etc.

Since then, both myself as a consultant and jobs on Toptal have evolved independently. The jobs seem to involve a little more of all of my services. It could be a function of Toptal moving more towards mid- or later- stage companies or it could be that my own experience with Toptal has now allowed me to offer my entire breadth of services.

So today, I’m an advisor for a multitude of things. Now it’s review, revise, advise. So when I help with a presentation, it includes a pitch deck as well as a narrative (how they convey their story). It involves financial modeling. And of course, simply being a business advisor.

To explore the various types of consultants Toptal has (e.g., part-time CFOs, modeling experts, valuation experts), check out our resources pages here (includes job descriptions, hiring guides, interview questions and tutorials) which are helpful for both consultants and those looking to hire a consultant.

A diagram of some things that a financial consultant can help with: ROI, strategy, and TAM

Preparing Your Client: Don’t Be Afraid to Stress-test

I ask a lot of questions. The consultant should never be afraid to ask questions or challenge the client’s idea in and of itself.

Before I even get to asking the person on the phone, “What are you trying to accomplish here?” I will take about 30-40 minutes just so I can understand their business inside and out—pressure testing. Some love it. Others are taken aback. One of my jobs is making sure when you’re done with me and are sitting in front of an investor, there isn’t a single question the investor is going to ask you that I haven’t asked you already.

Additionally, a lot of the work I do is in financial modeling. Often, this isn’t building from scratch but it’s reviewing an existing model, stress testing, or challenging assumptions. So if a company says, “We’re going to sell to one billion people in Year 1,” I’ll come back and ask, “What’s the market size?” or “What makes you think you can get that whole market?” Generally, I’m making financial models make more sense.

Arm the Executive: Provide the Client with Deliverables Drenched in Research and Data

With fundraising, my #1 job is to make sure the CEO has an answer to every single question that might be asked. This is of course substantiated with market research, valuation, etc. I’m not just trying to force them to vocalize an answer and run with it. We’re working towards getting the right answer.

For valuation, sometimes a CEO comes in and says, “I want $1 million for 10%.” Well we’ve all seen Shark Tank and when probed further on why a $10 million valuation is the right number, the response is usually quite hazy like, “It just feels right” or “That’s where similar companies are.”

I provide the CEO with both a top-down and bottom-up approach to valuation. So, every client I work with walks away with a document—several pages of valuation research. From a top-down perspective, I explore what similar software or fintech companies (if that’s the appropriate benchmark industry) traded over the past year or two. I’ll look at what the average seed range size is, if that’s appropriate. Lots of macro work.

Then, on the micro side—I’ll take a more granular perspective. I do market research on similar or competitor companies and determine what multiple they’ve traded at recently. I garner those multiples from a variety of transactions—from another investment round to an IPO to an acquisition. I spend a ton of time digging in to find numbers that others can’t find and figure out how to back into revenue or EBITDA or volume multiples. I take those, apply them to the client’s company and produce a well-founded, substantiated valuation.

Creating Successful Pitch Decks: Client Collaboration Is Key

So someone says they want to do fundraising and that they need a presentation. In this case, I will offer them two options.

Option 1 – I’ll ask for all their collateral and try to understand everything about their business. Then I will put together a presentation from scratch. This usually takes about a week.

Option 2 – I’ll ask for all their collateral again and I’ll review it but, this time, I’ll send them back a custom outline of what I’d like the final presentation to include and let the client put the deck together themselves. Then, I will go back in line-by-line, review and edit.

I’m clearly charging less for Option 2; however, the rate of success is significantly higher. The reason it’s more successful is that when the client is presenting, they know every single detail of every page—every icon, graph, and what data came from where. It’s a far more natural presentation.

Pitch Decks: The Three Most Important Slides

A presentation should tell a story. It should have some sort of flow. When someone is reading it or you are presenting it, it should just make sense. So putting the cover aside, the first real page should always illustrate the problem. The second page should always say how big that problem is. The third page should be your solution.

The theory behind that setup is that when you are presenting a problem, you want the audience to acknowledge the problem right away, begin to identify with it, and become vested in ways to problem solve.

The next page (page 2) shows the market size—how big and deep this problem is. Now, an investor not only agrees with you that there is a problem, but they can also see the magnitude of it. Now the investor’s brain is going into overdrive on how to solve this problem.

Then by the time you hit the solution page (page 3), you will have already aligned your solution with the audience’s thoughts on what is needed.

I try to take a very psychological approach to these presentations. Essentially, I want to get the investor to agree there’s a problem, see that it’s a big problem, and then “ah ha!” here’s how to fix it.

Those three pages will go a long way in aligning an investor’s and a CEO’s thinking. You start out by sitting on opposite sides of the table and by the end you are solving a problem together side by side.

Obviously, presentations require more information, but those three things are key. After that, everything is proof or in support of those first three pages (your business model, secret sauce, how it works, timeline, projections. etc.)

An additional tip I have that many overlook is that the aesthetic or design of a pitch deck or presentation needs to match the company’s website. This establishes continuity between when you present and when they Google you.

Check out this article for more tips and tricks on creating expert pitch decks – Experts’ Corner: Pitch Deck Tips for Fundraising Success.

How Do You Grow Your Book of Business? Create a Repeatable Process, Go the Extra Mile, Ask and Listen

As an effective consultant, having a repeatable and scalable process is crucial. While creativity plays a role, overall it is a very standardized process. When a CEO needs helps with a presentation, I send the outline, have the CEO put something together, and then go through that presentation page by page.

In terms of improving your trial-to-hire conversion rate, I’d recommend always spending that extra 10-20 minutes on the interview call to really dig in with the client. Don’t be afraid to give the potential client something for nothing—that way they walk away from the initial call having received something of value from you.

Lastly, I’d urge fellow consultants to be honest with the client and themselves. If you do not understand the client, ask, then ask again. If you don’t feel like you have the right skills for the engagement, tell the potential client and stop the interview. Toptal is an incredible marketing machine, and there will be other opportunities.

How to Handle Unhappy Clients: Spot a Poor Fit Before You Engage

I haven’t really ever had unhappy clients, I’ve just had potential clients who I felt I couldn’t be successful with. I measure my own success by how successful my clients are. I take the interview process very seriously and if I don’t think I can help, I try to find out as early as possible and not take the engagement.

The toughest type of client I deal with is the scatterbrain—someone who doesn’t truly have an idea of what they want. My advice to any CEO is to begin with a clear goal in mind for hiring that consultant. Unless there’s direct guidance from the CEO on his/her goals, the job becomes much more difficult.

While a scatterbrain client could be highly lucrative (constantly pivoting to attack new goals racks up a lot of hours), at the end of the day, I don’t feel like I’m providing something useful to him or her. Those cases where I’m not set up to add value are ones I try to spot early on and or avoid from the beginning. It’s a waste of the client’s time and mine.

On the interview call I’ll simply be honest and transparent about that feeling. I’ll say something like, “maybe it’s too early” or “I’m happy to brainstorm further but if you don’t have a clear direction, maybe now is not the best time to engage my services.”

A visual representation of successful brainstorming with a financial consultant

Client Interviews: How to Prepare, Lead the Discussion, and Get the Job

I try to be as well-informed as I can be about the company itself and its industry. My background gives me enough of a dynamic point of view that I can have a conversation with almost any industry. In addition to that base layer of knowledge, I’ll always check out the company’s website and any collateral such as a presentation the potential client had sent over.

For example, if the client is involved in real estate blockchain, I’ll spend 20-30 minutes Googling and simply reading articles trying to understand the space. If it’s a software company trying to be sold globally, I’ll look into what is the market depth. I’ve never gone into an interview completely blind.

So I’ll come into the interview with a general understanding and lead that client into an in-depth discussion of their business. I spend 30-60 minutes with them just trying to understand who the client is, what the idea is and why they’re pursuing this idea. I ask a lot of questions and I really take the time to understand the client’s business. Now the client can clearly see, “This guy gets my business.” If I can prove to that person that I can truly understand their business, they’ll want to hire me. They’ll see that I can actually be helpful.

Closing Thoughts from the Editor

Becoming an Amazing Financial Consultant clearly doesn’t happen overnight but Jeffrey’s playbook seems to be a great place to start. The most important features include: doing your homework, being upfront and honest with clients and not being afraid to challenge. While Jeffrey Fidelman is one of Toptal Finance’s best financial consultants, there are many more on the platform and they all share one thing in common for certain - an innate drive to help clients. It’s as simple as that. The best consultants use their years of experience, specialized degrees and proprietary banks of knowledge to do whatever they have to do to help their clients’ goals come to fruition.

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