The CFO Playbook: Key Investment Strategies for Scaling Business

Across 2025, our Spotlight Interview series takes a deep dive into the modern CFO.

No longer just a financial steward, the CFO is viewed as a strategic partner deeply embedded in all facets of the business. Over the next 12 episodes, The CFO Playbook will uncover the skills, insights, and leadership approaches to serve as a gateway to understanding the multifaceted role of the CFO and how they contribute to organisational success.

For episode 3, we meet with Russell Smith to chat through his thoughts around key investment strategies. [5 minute read]

David Waddell: Russell, thanks for joining us for this latest edition of the CFO Playbook. Before we dive in, I should, of course, mention your triumph at our inaugural padel event earlier this year! No pressure to reclaim your title in 2026!

If we can start with a quick overview of your career to date and your philosophy as a CFO.

Russell Smith (RS): Thanks for having me, David. And yes, I’ll happily take the padel bragging rights while they last!

I’ve spent my career working in ambitious, fast-growing, private equity-backed businesses with a strong focus on scaling through both organic growth and strategic acquisition. Since August 2024 I’ve had the pleasure of serving as CFO of Pembroke Financial Services, the advice firm of choice in the South, supported by our financial sponsors Cow Corner & Summit Partners. Our mission is to build a leading, regional, client-first financial planning business, and my role is to ensure that our growth is both strategically sound and financially sustainable.

Before Pembroke, I held senior finance roles at IRIS Software Group, backed by HG and ICG, where we were in a high-growth, acquisitive environment with complex integrations and cross-border expansion. Prior to that, I was at FMP Global, backed by Tenzing private equity, where we scaled across new regions and verticals before exiting to IRIS in 2019.

Across all these roles, I’ve operated in fast-paced environments where the CFO role goes far beyond reporting numbers. I see it as being both a strategic partner and a financial custodian ensuring every decision aligns with long-term goals, supports enterprise value, and is grounded in robust data and governance. Ultimately, my job is to build confidence both within the business to scale boldly but wisely, and confidence among investors and stakeholders that we’re deploying capital with discipline and clarity.

Thanks Russell. You’ve clearly got the experience to shed light on what can be a daunting yet rewarding part of the growth journey. In your opinion, what are the three most critical financial considerations when a business is preparing to scale?

RS: The big three for me are cash flow clarity, margin discipline, and infrastructure readiness. You need to be absolutely certain your cost base can scale, that you have robust forecasting tools, and that you understand where growth creates value versus where it introduces risk. At Pembroke, we’re very deliberate about sustainable scaling, balancing best-in-class client service with operational expansion underpinned by strong financial governance.

And how do you know when it’s the right time to push the accelerator versus consolidating what you’ve already built? I would have thought that timing would be critical here.

RS: I look for consistency in the core metrics through client acquisition cost, retention, margin performance, operational efficiency. At FMP, we knew we were ready to scale when we saw repeatable, profitable growth both organically and through acquisition. If growth feels volatile or operational strain starts showing, that’s a signal to consolidate before you move again. It’s about scaling with purpose, not just momentum.

Scaling quickly can be exciting but risky. What are some of the common pitfalls you’ve seen?

RS: Overestimating market readiness or internal capability is a big one. I’ve seen integration efforts underestimated, and the working capital drag overlooked particularly during acquisitive phases. At IRIS, we learned quickly that robust integration planning and cash management are essential parts of any scale-up strategy. And underinvesting in financial systems and data is another trap; it might not bite immediately, but it catches up fast in high-growth environments.

In terms of investment decisions, how do you decide where to place your bets for the best return?

RS: I start with hard data, but always view it in a strategic context. At Pembroke, ROI is measured not only in revenue but also in how investments improve client outcomes and long-term efficiency. Across IRIS and FMP, we often used a combination of Lifetime Value/ Customer Acquisition Cost, margin contribution, and strategic alignment to direct capital. Acquisitions or tech investments performed best when they met those criteria, and we had the integration capacity to deliver.

And with prioritising investments, what’s your approach?

RS: I apply a four-part lens: financial return, strategic alignment, execution complexity, and time to value. It forces discipline and keeps the focus on initiatives that fit the long-term vision without overextending operationally.

When a company is in high-growth mode, demands on capital can be challenging. How do you allocate resources between talent, tech, and infrastructure?

RS: It’s phase-dependent. At FMP, international expansion meant infrastructure first. At IRIS, integrating acquisitions meant technology and systems. At Pembroke, being an advisory-led business, our priority is investing in high-quality people closely followed by technology that enhances the client experience and supports scalable operations. The key is making sure these three areas work together rather than competing for capital.

Funding is a big piece of the puzzle in PE-backed environments. What’s worked best for you?

RS: I’ve seen great results with a blend of structured equity and growth-oriented debt facilities. Patient capital from strong backers allows you to focus on long-term value creation, while targeted debt accelerates tactical growth without heavy dilution. Matching the funding approach to the specific growth initiative is key.

I would have thought that managing investor expectations during rapid growth can be tricky, to say the least! How have you gone about this?

RS: Honesty and clarity, backed by data. Across all my roles, I’ve found that investors value regular, evidence-based updates even if the message is nuanced. At IRIS, managing multiple stakeholder groups through complex integrations meant we had to align everyone on the long-term value creation plan while keeping near-term KPIs front and centre. Don’t overpromise but be transparent about both risks and mitigations.

As we near the end of our time together, let’s touch on risk management. How do you assess and mitigate financial risks during scaling?

RS: I start with understanding margin sensitivity, cash burn, and integration risk. At FMP, we built risk models into every growth scenario, and at Pembroke we evaluate downside impact as closely as the upside potential. We keep buffer capital and use rigorous governance and scenario planning to prepare for volatility.

Across all your experience, have you ever had to pivot away from a scaling strategy?

RS: Absolutely. At FMP, we pursued a geographic expansion that didn’t gain traction due to local market dynamics. We pivoted quickly, redeploying capital into higher-ROI verticals. The lesson: validate early and be ready to course-correct. Agile financial planning is essential, especially in PE environments.

Finally, what advice would you give CFOs looking to lead their business through a scaling phase?

RS: Invest early in your data, systems, and people; the infrastructure needs to be in place before growth takes off. Stay close to the commercial levers of the business, understand where growth genuinely adds enterprise value, and don’t be afraid to challenge the pace or direction if it’s not sustainable. As a CFO, you’re not just managing the finances, you’re co-piloting the journey.

I love that – co-piloting the journey! With your permission, I’m going to use that going forward; that’s a great place to end our time today.

Thanks again, Russell; plenty of takeaways there for any finance leader navigating growth. All the best for your own journey, and I hope to see you on the padel court at some time in the future!

Did you miss the earlier instalments of the CFO Playbook? Check out James Sweeny‘s take on Navigating Economic Uncertainty, and find out how Jonathan Allard Manages Cash Flow in High Growth Businesses. 

If you’re a CFO and would like to take part in The CFO Playbook Spotlight Interview Series, then please reach out to David Waddell, Founder of Harvey John.

September 2025