Voices of Leadership: Brad Kayton
Welcome to Voices of Leadership. We are excited to be introducing our new series, where we will be conducting interviews with different CEOs, CFOs, entrepreneurs, investors, and executives. Our first interview features Brad Kayton – a serial entrepreneur, fractional CFO, and NorthEast Regional Director for the CFO Centre. Keep reading to find out what he has to say.
Let’s begin directly with the pressing realities of 2025. How are you adapting financial strategies for your clients amid ongoing global market uncertainty? What do you see as the most significant challenges businesses in the $10–$30 million revenue range face today?
In 2025, uncertainty is more the baseline—whether it’s inflation, volatility, geopolitical instability, tightening credit markets, or evolving AI and regulatory environments. As a CFO and advisor, the priority is helping clients build financial strategies that are not only resilient but agile. That means more dynamic forecasting, scenario planning with shorter review cycles, and stronger cash management discipline.
For companies in the $10–$30 million revenue range, the most significant challenges we see fall into three buckets:
- Capital Access & Cost of Funds: Many mid-sized businesses are feeling the squeeze between rising interest rates and more conservative lending practices. Without deep balance sheets or institutional relationships, they’re often caught between needing to invest for growth and preserving liquidity. We’re focusing on optimizing working capital, renegotiating credit facilities, and exploring non-traditional financing like revenue-based lending or strategic partnerships.
- Margin Compression & Cost Structure: Costs—especially labor, input materials, and software—have risen faster than pricing power in many sectors, and that was before the tariff-teasing from the Trump administration. That’s forcing a hard look at operating efficiency. We’re guiding clients through zero-based budgeting, vendor consolidation, and automation investments, especially in back-office functions like finance and operations.
- Strategic Focus & Execution Risk: Companies at this scale often get pulled in multiple directions—new markets, digital transformation, M&A opportunities. But in an uncertain environment, focus is a superpower. We’re helping clients define 2–3 critical initiatives with clear ROI and accountability, rather than chasing growth for growth’s sake.
Ultimately, our job as CFOs isn’t just to count the numbers—it’s to create clarity, reduce noise, and help founders and executives make confident decisions when visibility is low.
What major financial risks are you prioritizing in 2025 that might have been considered secondary or less critical five or ten years ago?
In 2025, some risks that used to be on the periphery are now front and center—because they can materially affect valuation, cash flow, or even survival.
First, cybersecurity and operational continuity risk. Ten years ago, it was largely viewed as an IT issue. Today, a ransomware attack can freeze receivables, paralyze operations, or trigger regulatory penalties—and the financial fallout can be existential, especially for lower and mid-market firms without robust incident response plans. We’re now budgeting for cyber insurance, conducting system audits, and embedding digital risk into financial planning.
Second, talent and succession risk. Five or ten years ago, most finance teams focused on headcount cost. Now we’re evaluating talent retention and leadership pipeline as financial risks—especially for founder-led or family-run businesses. One unexpected exit can derail strategic momentum, client relationships, and revenue predictability. We are spending more time now with CEOs on retention strategies and incentive design than ever before.
Third, AI-automation disruption and technology debt. What was once an innovation conversation is now a financial one. Companies that haven’t modernized their systems or adopted automation are facing real competitive disadvantages and cost drag. We are seeing a rising risk of “tech paralysis”—where the fear of choosing the wrong tools leads to underinvestment, which erodes margins and scalability and competitiveness.
These risks—once secondary—are now strategic. They touch value creation, business continuity, and investor confidence, so they’ve earned a place on the CFO’s dashboard.
In the current environment, is it more critical to make tough, fair decisions quickly, or can a strategy of cautious endurance still be viable? Is waiting for ‘brighter days’ a realistic tactic, or does it increasingly rely on luck?
In today’s environment, speed and clarity are more valuable than perfect information. Making tough, fair decisions quickly is not just critical—it’s often the difference between staying in control and getting forced into reactive moves later under even worse conditions.
That said, speed doesn’t mean recklessness. The best operators are acting decisively, but with a strong foundation of data, cross-functional input, and scenario modeling. We’re encouraging CEOs, whenever possible, to adopt a “decide, communicate, refine” loop—where imperfect action beats slow deliberation, especially when markets, rates or customer behavior are shifting fast.
The idea of waiting for ‘brighter days’—especially without a defined contingency plan—has become riskier than ever. Hope is not a strategy. Companies that put off change are often left with fewer options, lower valuations, or deteriorating culture. Cautious endurance can work—but only if it’s paired with active planning: tightening execution, watching cash closely, and maintaining strategic flexibility.
If your plan depends on a favorable macro environment showing up on schedule, that’s not strategy—that’s luck. And good business leaders never leave outcomes to luck.
If the effectiveness of a CFO were measured solely by the speed of decision-making rather than outcomes, how would that reshape your approach to the role?
If speed became the only metric, the role of the CFO would shift from being the company’s risk-balancer to its pace-setter. It would emphasize intuition, agility, and iterative thinking over precision, long-range analysis, or consensus-building.
Speed without context is dangerous. A faster decision isn’t inherently better—it’s only valuable if it delivers without undue risk, accelerates learning, or preserves strategic momentum.
Do think about how you can redesign how the finance team delivers value, such as faster feedback loops, real-time dashboards, and tighter alignment between data and action. Empower frontline managers with clearer guardrails and decentralize more authority—because waiting on centralized approvals kills speed.
Prioritizing speed in decision-making means reshaping team dynamics. You’d want a finance organization built more like a startup product team: small, cross-functional, and empowered to test, learn, and adapt quickly. Instead of optimizing for certainty, we’d optimize for decision velocity and course correction.
That said, the best CFOs balance speed and signal. The goal isn’t to act fast—it’s to act fast enough to stay ahead of risk without outrunning your ability to execute.
Which financial metrics do you personally monitor that might not receive enough attention from broader leadership teams. Not just as static numbers, but as early indicators of broader business trends or risks?
While Revenue and EBITDA get all the airtime in leadership meetings and in the Private Equity circles, we at the CFO Centre like to create KPIs (Key Performance Metrics) on leading indicators—metrics that tell you where the business is headed, not just where it’s been. Three stand out as underappreciated but powerful:
- Gross Margin Variance at a Granular Level.
Not just the top-line percentage, but the movement within product lines, customer cohorts, or regions. Small shifts here can signal pricing pressure, cost creep, or product-market misalignment well before they show up in profit. Treat it like a business health monitor—when gross margin fluctuates without a clear cause, it’s a red flag. - Cash Conversion Cycle Trends.
Leadership often watches the cash bank balance on a regular cadence, but fewer track how efficiently that cash is generated. Pay close attention to the movement between receivables, payables, and inventory. A widening cash cycle can signal operational drag, weakening customer discipline, or supply chain stress—long before revenue takes a hit. - Customer Acquisition Cost Payback Period.
Especially in businesses with recurring or high-lifetime-value models, we watch how long it takes to earn back the cost of acquiring a customer. If that payback period is lengthening, it could indicate lower-quality leads, inefficient sales processes, or pricing mismatches. It’s a great proxy for growth efficiency.
In short, look for metrics that have motion, not just magnitude—things that move early and hint at strategic drift. These are the signals that let you steer, not just report.
How would you assess the reliability of AI-driven financial analysis tools in 2025? In your view, why does traditional financial oversight remain critical despite technological advancements? By 2030, do you believe financial insights will primarily come from AI, human expertise, or a deliberate combination of both?
In 2025, AI-driven financial tools are powerful—but not infallible. The systems we see with clients are excellent at pattern recognition, anomaly detection, and automating routine analysis at scale. Tools to surface questions faster, identify trends sooner, and speed up monthly close or forecasting cycles. Often we find the new AI deployments: they highlight symptoms, not root causes. Reliability depends entirely on data quality, model transparency, and the clarity of the business context they’re being applied to.
That’s why traditional financial oversight—critical thinking, cross-functional understanding, and judgment under uncertainty—remains indispensable. AI can flag that margins are slipping or churn is rising. But understanding why, and what to do about it, still falls squarely on human shoulders.
As we look to 2030, the most likely scenario is a deliberate combination as the winning model. AI will increasingly handle the “what happened” and “what might happen” layers—freeing CFOs and finance teams to focus on “what does it mean” and “what should we do next.” The future of financial insight is symbiotic: AI handles scale, speed, and structure; humans bring nuance, strategy, and context that can’t be trained from spreadsheets alone.
AI will make good finance teams faster. But great finance will still require judgment. And judgment isn’t automatable. And don’t trust the algorithms to make key decisions for you.
Given the continued advancement of AI, how do you believe the skill set required for successful CFOs is evolving? What competencies will be essential for the next generation that were less critical when you began your career?
The role of the CFO is shifting from being the steward of financial accuracy to being the architect of financial agility. With AI transforming the way data is processed and reported, the next generation of CFOs won’t be valued just for what they know—but for how quickly they can turn accurate insight into effective action.
What’s changing most is the blend of technical fluency and strategic leadership. When I started, it was enough to be an expert in GAAP, budgeting, and variance analysis. Today’s CFOs still need that foundation—but layered with the ability to evaluate technology, lead cross-functional transformation, and tell a compelling financial story to stakeholders inside and outside the company.
A few emerging competencies stand out:
- Data Interpretation, Not Just Analysis: AI can generate dashboards—but making sense of conflicting signals, weighing risk trade-offs, and aligning decisions with business strategy? That’s a human skill, and increasingly the CFO’s job.
- Tech Fluency and Tool Selection: CFOs don’t need to code, but they do need to understand how AI, automation, and analytics tools work—and how to evaluate whether they fit the business model, scale, and culture.
- Change Management and Communication: The modern CFO is no longer tucked away in the back office. They’re at the center of change, helping the organization navigate complexity. That requires influence, clarity, and trust across departments.
Tomorrow’s CFOs need to be part operator, part technologist, and part strategist. They simultaneously need to be effective at the strategic, at the operational, and across business support areas for their companies. The fundamentals still matter—but the differentiators are shifting from precision to perspective.
You have significant expertise in tariffs, an area that continues to complicate international business planning. What are the most common tariff-related financial miscalculations you see companies in the $10–$30 million range making today?
The most common mistake I see in this space is treating tariffs as a static cost of doing business, rather than a dynamic variable that can—and should—be modeled, mitigated, and even leveraged.
In companies with $10–$30 million in revenue, tariff exposure often flies under the radar until it hits margins hard. Three miscalculations show up most commonly:
- Underestimating Cumulative Tariff Impact on Unit Economics.
Many companies focus on gross landed cost but fail to fully account for how even modest tariff shifts can compound across the supply chain—especially with just-in-time models or SKUs sourced across multiple regions. That’s where I’ve seen margin erosion creep in silently and unpredictably. Do a supply chain analysis of your supplier’s suppliers. - Lack of Scenario Planning or Hedging Around Policy Volatility.
Tariffs are often politically driven, and yet companies still plan as if trade policy is stable. Few mid-sized businesses model best- and worst-case tariff exposure in their forecasts, or take steps to diversify sourcing and assembly locations. In 2025 that has become a blind spot, especially with the U.S.–China landscape in flux and more “friendshoring” pressure coming in. - Missing Strategic Opportunities in Tariff Engineering.
There are often legitimate ways to reduce tariff impact—through reclassification of goods, country-of-origin planning, altering supply chain routes, or using duty-free and bonded warehouses in Foreign Trade Zones (FTZs) in the U.S. (tariffs aren’t paid until goods leave the warehouse). Larger firms build this into procurement and design. Smaller firms often don’t realize the financial upside of being proactive here. Larger companies can save six figures simply by revisiting product classification or restructuring import strategies.
Ultimately, tariffs aren’t just a trade issue—they’re a strategic cost factor. Companies who treat them that way can unlock significant value, while those who ignore them risk getting caught off guard when policy or pricing shifts overnight.
Want to hear more from Brad Kayton? Watch Mario Peshev’s interview with him:
Beyond Tariffs: Expert CFO 2025 Market Analysis and Strategy w/ Brad Kayton
With tariffs increasingly used as both economic tools and political instruments, how should CFOs build tariff-related volatility into their financial modeling and forecasting strategies?
The key is to treat tariffs like you would any other form of geopolitical risk: not as a surprise, but as a forecastable variable. They may be unpredictable in timing, but they are entirely predictable in possibility. And that’s what modeling is for.
First, we lead clients to stop building tariff assumptions into just the “actuals” column and start embedding them directly into forecast scenarios. It’s not about predicting policy—it’s about pressure-testing your model for the plausible.
There are three primary recommended approaches:
- Build Tiered Forecast Scenarios.
Just as you’d plan for conservative, baseline, and aggressive revenue models, you should model baseline, elevated, and worst-case tariff environments. This allows CFOs to present the rangeof outcomes—not just the average—and proactively shape contingency plans. - Identify and Isolate High-Exposure Inputs.
Map your top 10 imported materials or components by cost and country of origin. Knowing which SKUs are tariff-sensitive enables targeted risk modeling. We’ve seen mid-market companies discover that 20% of their COGS sits in just a few categories vulnerable to policy shifts. - Bake in “Policy Risk Buffers.”
Rather than guess which way policy will swing, build a reserve—either in working capital or pricing flexibility—to absorb shocks. You might not avoid the tariff, but you can avoid margin surprise. Some companies use this as a decision lens for when and how to pass costs to customers.
Our CFOs help CEOs and their Boards stay closely connected– directly or indirectly through the CFO– with trade advisors, legal counsel, and supply chain leads. Tariff risk isn’t a spreadsheet problem—it’s a strategic conversation that touches sourcing, pricing, and customer relations. The companies that navigate tariff volatility best are the ones who treat it as a boardroom topic, not just a finance footnote.
William Feather once said, ‘A budget tells us what we can’t afford, but it doesn’t keep us from buying it.’ In your view, what is one investment that mid-sized businesses cannot technically afford in 2025, but would be strategically wise to make anyway?
In 2025, the investment many growing businesses think they can’t afford—but absolutely need to make—is in operational automation—especially for finance, procurement, and customer operations.
On paper, it’s easy to defer: the upfront cost, change management lift, and internal resistance make it an easy line item to postpone. But the irony is the longer you wait, the more expensive standing still becomes. You’re paying a hidden tax every month in manual errors, approval delays, excess headcount, and slow decision cycles.
So sure, automation might “break the budget” this quarter. But not investing in it breaks your scalability long term. It’s the difference between having a finance team that reports the past and one that shapes the future.
To borrow Feather’s spirit: A budget may tell you what you can’t afford—but strategic neglect is far more expensive than smart, timely investment.
Finally, if you had the opportunity to make one strategic wish on behalf of mid-sized companies navigating 2025’s complex financial environment, what would that wish be?
My wish would be simple: run your business as if you were going to sell it—even if you’re not.
Why? Because the disciplines that create a valuable, sellable business—clear reporting, recurring revenue, strong cash flow, resilient operations, and clean legal and financial structures—are exactly the same disciplines that make a business more scalable, fundable, and enduring.
Too many owners treat exit planning as a last chapter when in reality, it should be baked into the entire strategic narrative. Whether you sell in three years or twenty, thinking like a future seller brings clarity to decision-making. It forces focus on what builds enterprise value, not just annual profit.
So my wish is that more mid-sized businesses adopt an “always sale-ready” mindset—not because they’re planning to exit, but because good business strategy is good exit strategy. And in today’s uncertain climate, having options is the most valuable asset of all.
Brad Kayton, Fractional CFO & Regional Director for CFO Centre
Brad Kayton is a serial entrepreneur, seasoned operator and fractional CFO who has been working as a financial professional and strategic consultant for companies large and small over the last decade. He is currently the NorthEast Regional Director for the CFO Centre, the world’s oldest and largest fractional CFO practice. Kayton has been a fractional CFO for 14 entities, but also over his career was a CEO three times, COO twice, VP/Head of Marketing twice, and a Board member or advisor for 16 companies. He is both a Registered Investment Advisor (Series 65) and a Certified Exit Planning Advisor (CEPA) helping clients plan and execute successful exits. He has been involved in three notable exits as a founder-entrepreneur and over a dozen as a financial professional. For more information, please visit www.cfocentre.com/us, or LinkedIn.
