At the financial helm of Ohio-based home improvement company Leaf Home is Scarlett O’Sullivan. Leaf Home is North America’s largest direct-to-consumer provider of full-service home solutions, which is on a mission to turn complex home improvement projects and endless to-dos into achievements. LeafFilter, its award-winning gutter protection system, has been recognized by leading names like Good Housekeeping, Qualified Remodeler, Angi, and Consumer Reports. With 260 locations throughout the U.S. and Canada and a dedicated team of experts, Leaf Home’s objective is to deliver innovative products and reliable services. The company has been recognized as one of Inc. 5000’s fastest-growing private companies and a top employer.
Recently, Scarlett and I connected to discuss her transition from investment banking to investing and then to CFO, takeaways from working in diverse industries, building solid relationships in the C-suite, what advice she has for aspiring CFOs, and more.
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From a young age, Scarlett O’Sullivan had the chance to see parts of the world that most people only hope to achieve in a lifetime. She was born in France and lived the expat lifestyle as a kid, spending time in Europe and South America and eventually splitting her high school years between Madrid, Spain, and Paris, France.
She decided to go to college in the U.S., even though she had never lived there, where she majored in economics at Yale. While working in investment banking, O’Sullivan expanded her academic repertoire at The Wharton School at the University of Pennsylvania, where she earned an executive MBA. Her academic achievements were her parents’ dream come true.
“Going to America was a dream, something they wished they had done as kids,” she explained. “I went to American schools even though I lived in all these different countries and always hoped to get to the U.S. I was lucky to get into Yale. It was a bit of a culture shock, coming from overseas, but it was a great experience.”
Her first professional role upon graduating from Yale was at Morgan Stanley, where she got her feet wet in equity capital markets. Many economics majors were talking about investment banking, and O’Sullivan was intrigued by the potential after speaking with the recruiters who visited Yale’s campus.
Scared that she might miss out on corporate finance, she requested a move in her second year, where she covered large conglomerates, including aerospace and defense companies. That led to her getting a call from Robertson Stephens, another opportunity that intrigued her. O’Sullivan imagined that working at a smaller investment bank would benefit her, and she was correct. She stayed with the company for several years, covering tech clients in San Francisco, New York, and London.
O’Sullivan’s expat life called again when she ended up in London and then Tokyo because of her husband’s job. She spent several years not working. Although she didn’t intend to take a break from her career, it gave her the chance to find renewed energy.
“While I was there, I was itching to get back into my career,” she said. “I was quite certain I didn’t want to go back to banking, but I had always been curious about what it would be like as an investor. I ended up joining a fund that SoftBank sponsored. I got a chance to go to headquarters in Tokyo from time to time. I brought the job back with me to New York when my husband moved back to the U.S. I enjoyed moving from transactional banking deals to investments and spending more time looking for investments, but also having the chance to monitor and understand what the businesses were doing internally, and to see how they would get to their goals.”
That transition ended up being just what she needed, setting her up to take on her first CFO role at high-end clothing rental company Rent the Runway.
For any aspiring CFO, O’Sullivan believes that her nontraditional path of going from investment banking or investing to the CFO role is becoming more and more common.
“It feels like we’re seeing more of that now, whether it’s bankers or investors moving towards operator roles,” she said. “I remember the board having a bit of pause on that. Did it make sense to have someone who had never been inside of a company help navigate the next stage of the company’s growth? There was a lot of transformation ahead of us. I feel fortunate that it happened, and they took a chance on that transition.”
O’Sullivan ended up being precisely who the CEO needed, leading the company through its IPO. A critical step in ensuring the company was ready for the IPO was prepping the team. The advice she had once received helped her understand what was necessary.
“I once heard something that stuck with me: If you think about a company growing and the company is tripling in size, you need the leaders and the managers also to be tripling themselves in terms of their impact,” O’Sullivan explained. “When you think of it that way, it’s a big expectation.”
In addition to the IPO challenging her team to increase their impact, there were many other takeaways from the process. To any financial professional whose company is considering an IPO, O’Sullivan advises that they remember that it is a journey. The reality is that much work–and not the inexpensive kind–must lay the groundwork. She notes that even though someone might map out an ideal timeline for how they think the process is going to go, it will likely be drastically different in the end.
A critical component that is not to be undervalued? Storytelling.
“There are many parts of the storytelling that you have to feel good about,” O’Sullivan explains. “The ability to go in front of investors before it is even a potential investment for them is important. Test it, get some feedback and incorporate some of that feedback. You also find that when you tell people your plans, you want to be able to come back and deliver on those plans. ”
Following Rent the Runway, she took another big chance to advance her career, enhance her experience and learn a new industry by taking on a CFO role at Leaf Home. Since 2005, the company has been a leading direct-to-consumer home improvement company. They originally started in gutter installation and protection, and since then, have added products such as water filtration, bathroom conversion, stair lifts, and garage flooring. Leaf Home currently has about 260 locations throughout the United States and covers 87 percent of U.S. zip codes.
O’Sullivan was excited about the company’s foundation as well as its potential.
“I’m excited about the space that the company plays in,” she said. “There’s a large market opportunity, and we’re early on in gaining market share. At the same time, the company has scaled quite a lot. The company’s scale was a testament to its competitive advantage. The combination of an exciting market and the mission is important–it motivates me. People care a lot about their homes, and we’re trying to help homeowners manage them while simplifying homeownership.”
As someone coming from a different industry, O’Sullivan’s first 90 days and beyond were devoted to learning about the customer and understanding the industry. She just hired a senior leader on her team, whom she advised to do the same.
“My advice for his first 90 days was to learn as much as you can about the business, shadow some people, and build personal relationships,” she said. “In the end, that is what will allow you to have an impact on the organization. Those three things are the most important.”
To O’Sullivan, one of the most critical relationships at any company is the one she has with the CEO. It’s a dynamic she’s worked hard to define and refine throughout her career. To build a trusting, empowering relationship with the CEO, she encourages other CFOs to seek open, transparent relationships that challenge both individuals, where it is safe to be right or wrong at different points in time. With open lines of communication, clear expectations about goals, and kind ways of challenging people, it will lead to a successful partnership.
She references a quote that has guided her perspective on the CEO/CFO dynamic: “If two people always agree on everything, one of them isn’t needed.”
In O’Sullivan’s career, needing other people has only propelled her forward. She has sat on multiple boards over the years and currently holds one board position at Olivela, a fashion e-commerce platform that has a mission to fund education for girls worldwide.
The responsibility has only helped her in her role as CFO.
“I had a curiosity,” she said. “I was always wondering what it was like on the other side. The CEO appreciates me more now. I can appreciate the challenges.”
One challenge that O’Sullivan faces outside of work is finding the best work-life balance. She and her husband have two college-aged children. But, although it might be easier because of her kids’ ages, it remains something she works at.
“I’m trying to be much more intentional now,” she said. “I came in [to Leaf Home] with that thought in mind of not allowing myself to be consumed as much as I have before, as exciting as it is because you have a passion for a business and you’re excited about the mission.”
She takes time to go on walks, spend time with her kids when they are home from college, play tennis, and find hobbies. She notes that it also creates an excellent example for the team to be well-rounded.
On the topic of younger generations and setting an example, O’Sullivan’s advice to the up-and-coming generation of CFOs is simple: Take the risk.
“I’m an example of the fact that the path is not linear,” she said. “Going into a CFO role was an experiment. Take the risk. Go after that experiment. This is my third career. You can get there in many different ways, and that’s okay. There are many ways to get the CFO role if that’s something you’re interested in.”