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The Modern CFO podcast is designed to illuminate the hard work that is behind the scenes in financing next-generation ideas and technologies, as well as acknowledging the developing role of senior financial professionals, and the tools they rely upon.
Hello everyone, and welcome back to another episode of the Modern CFO Podcast. As always, I'm your host, Andrew Seski.
Today, I'm joined by Glenn Schiffman, CFO of Fanatics. Glenn, thank you so much for being here.
Thanks, Andrew. It's great to be here.
Well we're in New York we're in the Blue Devil room. Why don't we start through some of the chronology of your career? You went to Duke and you played football. What were some of the early career decisions you made that led you into finance and really into marketing?
Look it's a great question. I wish I could go back and say it was all perfectly planned. But I've always been interested in finance at an early day, early days in growing up, I was enamored by the stock market, I believe I was 11 or 12 when I bought my first stock., I don't think I've ever shared this in this kind of forum before , when I was in eighth grade or seventh grade, I started an investment club of a dozen of us and we got together and we pooled capital, and I think we raised $1,300 for 10 of us, or 12 of us. You can obviously do the math there. And we invested in the stock and and the stock went up and I was hooked. And so all throughout, growing up I was around finance when I got to, when I got to Duke and realized that I wasn't very good at Division one Football. And realized I had to study and make something else of my life. I heard about, read about these analyst programs on Wall Street, and I came to the determination, which I think was right, that these are incredible training grounds, and you get a crash course working with really talented , really motivated people in finance. And that was fun, that was exciting, I enjoyed it. Anyway, 25 years later I had a lot of different jobs in finance, continued to, get promoted and do well. And along that journey, I had some managerial jobs and some leadership jobs, and that was really exciting and fun to me. So when the opportunity came to jump into, a CFO job, I thought that was a great, next step. Like anything else in life, you just follow the bouncing ball and you see where the opportunities are and make the most out of them and do the best you can along that journey.
When you started at Lehman, what initially attracted you to the media team?
It was head room and running room, and it was a small group. I was the only analyst. Which means, you got to do everything. ─ Also I didn't want to go to business school, way back then I thought it was a little bit of a waste of time. I had started a couple businesses while I was at Duke, like three or four. I sold them. I think I took a pay cut to come to Wall Street because of all the businesses that I started. And it was actually a predecessor to DoorDash, believe it or not. I owned a bar ;on campus, which was fun.
So anyway the media group. Had a history of promoting their analysts to associate and not sending them back to business school. And, I'd met a couple of people who went to business school and that wasn't quite my taste.
It was the opportunity, to be the only analyst. So you get a lot, you get a lot of opportunity. And, their history of promoting people. And I think that really defined my career. Where I learned how to do a lot at one time. And I learned how to multitask. And I think that's so important in business.
And I also learned how to just get stuff done. And if there's one piece of advice I give to anyone and everyone, in any career, doing anything, is just figure out how to get stuff done. Take it off the to do list. And then people will notice, and sometimes it doesn't have to be perfect, and sometimes, I'll often say, don't paint me a Picasso, but please, put some ink on paper. I learned how to get stuff done. And the more you get stuff done, your bosses tend to notice. And you tend to get, promoted, and you know what? They give you more stuff to do.
Let's talk about some of the famous cultures that you've been a part of, whether it's Duke Athletics, Lehman had a very competitive culture.
What are some of the lessons that you learned and implement here at Fanatics from those defining experiences?
Yeah look, culture is a force multiplier or it's destructive. It's important. Look, you try and make a culture of performance. Full stop.
And the best companies, in the world have that culture of performance, that culture of excellence. And that is from, the janitor to the CEO, that you don't do anything halfway, no matter what you're doing. And , that excellence needs to exude, because as a leader, you can't talk to everyone, you can't manage everyone, you need to manage by symbols.
And Singapore is a wonderful example, when Minister Mentor Lee Kuan Yew and people who don't know about Singapore and the story of Singapore please research it. When he founded that city state country, became one of the richest countries in the world, he said the minute people land in the airport, I want it to be the best experience in the world.
And then the drive from the airport to the city, I don't want to see one ounce of pollution. I want it to be beautiful, and the flowers to be wonderful. That's the same thing. You walk into our offices from the person who greets you up until, you're meeting with our CEO, I want it to be the best office you've ever been in.
I want trash to be off the floor. And that sets that culture. And that's important. And one of the mayors in New York, wanted to change the outside view of New York, he cleaned up the subways and the graffiti because he wanted people to have pride and wanted people to be excited . So I think that's how I think about culture. It's got to be throughout the entire firm.
The reason I wanted to talk about culture is that it can be shaken during market cycles, pandemics, global political strife. So what are those consistent cultural keys outside of just aiming for being as successful as possible that maintains that culture through difficult times?
Culture shouldn't change through difficulty. What's the old saying that, character isn't defined during crisis, character is revealed. And in times of crisis, if we're a great leader, we become even better. If we're not a great leader, we get exposed.
If you have the right culture, a culture of winning and losing, and that's also a culture of risk taking. And that needs to be okay. As you think across, the arc of your career, the arc of a business, the greatest leaders and the greatest businesses in this country and the greatest leaders in this country have often been the ones that have taken the most risk and that's what you need in a culture, risk taking, acceptance of failure, the management consultants will call it psychological comfort or some words like that. But you need to be able to take risks, the enterprise needs to embrace that risk, that means you lose and you're comfortable losing.
In times of crisis, you may lose more than you win. But if you have that fabric of being comfortable with winning and comfortable with losing, then the crisis will make you better.
That's a really great point. I love that quote as well. I want to talk through some of the successful acquisitions and as people are identifying risk.
You had this really unique opportunity to start on Wall Street, where you're constantly thinking through risk and reward. For CFOs who don't have a background in investment banking banking in general do you have any advice for evaluating new opportunities or successful playbooks that you've seen CFOs adopt?
Look, the, CFO job is multifaceted, you typically have, depending on the role, the structure of the company, anywhere from, five to 10 direct reports, and you can't be an expert. in all those functional areas. So you got to build your team around you. I happen to, as you said, have M& A experience so that's one of the functions where I'm particularly facile on, but if you aren't, then I would make sure you hire a darn good, head of M& A who can learn from you and who you can learn from. I've always, said in any leadership position, but in particular in a CFO position, you need the ability to go super deep in any one of your areas. You can't go deep in all your areas, but you need to be able to understand that functional area on any one specific issue as good, if not better, than the person who does that for you. Because they need to know that you're in the weeds with them it gives you real credibility with them and a unique understanding of what they do. Now, you don't need to do that all the time. It doesn't scale and you can't do that all the time. But for the CFO who doesn't have that M& A experience, I would hire a great person, and then I would dig in with them. When I went to Asia to run Asia for Lehman, I think I was in my mid 30s and, I was a deal person. It was my first management job. It was a challenge, I ran all the countries, all the industries I used to say from Seoul to Sydney, from Taipei to Mumbai, I painted you a 50 million square mile box, and I ran that.
To get credibility with my team, and the people talking to the clients in the region, I said, let's do a deal together. Put me in. I will be your partner, I will help you get this deal done. So I went deep with them on a transaction and that really helped me hone my deal skills. Respectful of and tailored to the nuances of the region. That's different than doing deals in other jurisdictions.
That's a really interesting transition. What are some of the biggest differences from being an investor and more transaction oriented to being an operator in the CFO position?
I had a wonderful as an investment banker over 25 years. It was great, incredible clients. Did a roster deal. I think I stopped counting when I pierced through a hundred billion dollars of transactions, dozens of IPOs wonderful people I worked for, wonderful people who worked for me but I was ready to move on and I was ready to move on because I wanted to do more.
I wanted to see what happened in the transaction. I want to be responsible for driving the outcome, not just setting up the transaction and the start. And the difference is forever. The difference is forever. Meaning, when you buy an asset as an operator, you own that forever. When you work on an asset as a banker, the deal closes and you move on to the next one.
So you get a little sharper on the work you do beforehand, and you work on the integration, and you see the pull through effect of everything. So yeah, the difference is forever.
What attracted you to IAC initially?
I was a banker for 25 years, and IAC was a client of mine. I was enjoying being a banker.
It was great. But I said at the time, I was running around the track and not sweating. You win another sell side, you want another buy side, you want another financing, and it was great. But it was, wow, now I put it on the conveyor belt, I know what to do. Yeah, the issues are different, but you know how the thing's going to play out.
And I wanted a new challenge, and I was fortunate that, they took risk on me and they decided to hire me. I've done a lot of work with them in the past. They were a client. I remember, my boss, CEO of the business, when he was talking about hiring me, I probably hadn't talked to him or seen him for eight to 10 years. And he's like, you know, I remember meeting Glenn. There's just something about him. He always was, on top of his numbers. He was deep. He understood as well as was able to give the strategic overlay. , That was obviously, I don't remember that specific meeting. I don't remember that specific interaction. Clearly something happened 10 years prior to being hired where I caught his attention. That's, also my advice, to people, as I said earlier, figure out and get stuff done. And, the other advice is you don't know what, this meeting will lead to, this interaction will lead to, so bring your A game all the time.
Because the world's watching, and it gets back to that sports analogy, there's a camera on everything. If you're on the field, someone's watching you. And it's how you carry yourself every single day. That could open doors for you in 10 or 20 or 30 years. And it develops your reputation, develops how people think of you.
Anyway, I was excited about doing it. It was a really interesting business. It was an entrepreneurial company. It was a multibusiness business., ━ You know, ,they took , some risks on me and it was a great run.
Do you feel it prepared you for the multiple business lines of fanatics?
Sure. IAC was a multi business business by and large. IAC bought, managed, grew and scaled consumer facing internet businesses. And you could argue we, buy, manage, scale, grow. Consumer Facing Sports Businesses. So yes, very similar. I think that's probably one of the reasons why they reached out to me.
We're Fanatics. We're in a multi business. We're in three businesses right now. Commerce, Collectibles, and Betting and Gaming. So there's just a lot of similarities. And a lot of the learnings that I had from ISE, and a lot of learnings I had from banking. Are very relevant here.
Are there lessons that you'd be willing to share about what makes successful CEO CFO relationships and how you think about successful relationships in the C suite.
Yeah, look, I think it's constant communication. Walk into each other's office multiple times a day, get on the phone multiple times a day I'll put in a plug for working in the office versus working from home. It just doesn't work if people aren't together, especially if that relationship isn't geographically approximate.
Look, I'd summarize it by saying you have to think similar enough to be efficient, but different enough to be effective. And I think that's really important. That you bring different perspectives. And it's okay to disagree. You shouldn't disagree all the time, then it's probably not the best relationship.
But it's okay to disagree. And it's okay to debate. But I think it's constant communication, and I think you need to understand each other's, over time, you understand each other's strengths. and weaknesses and where they like to play and what they like to do versus where you like to play and what you like to do.
And you have to figure out who does what in that, in that diagram of things to do for a company. It's a critical relationship, and that partnership can really be a force multiplier, or that partnership, can be tricky.
Talking about force multipliers, Fanatics has scaled at a pretty incredible pace.
What, in terms of the business, and maybe personally, are you most excited about? You're three to five years out, and there's so many new technologies becoming more available, a lot of efficiencies being able to be gained here, but you're already on an incredible trajectory. Just really curious about what's exciting to you right now.
Yeah, look, I'll come back to efficiencies and technologies in a second. Hopefully I won't forget. But look, what I'm all excited about is bringing it all together. The fan has never had one experience, an experience that we can deliver as a company. . Where you get your merch merchandise and that's, hundreds of thousands of products.
Where you have the ability to collect, collectibles, and buy, store, manage, vault collectibles. And, bet on gaming, and no one's brought that together. There's been pieces of that, and I think no one's done collectibles the way we're doing collectibles. No one's doing branded sports merch the way we're doing it.
So each of our businesses and betting, we have a, we have a great product and a great team there. And hopefully we're, scaling into something that's a different, so each of our businesses I think are a differentiating approach to attacking the customer. But the funnest thing for us.
is to hyper serve that fan in those three unique go to market motions, where we allow our fans to buy, bet, collect. No one's done that, okay? And as rights, and as media, and as sports, gets more and more expensive, multiple monetization opportunities are really important, and we bring three of those monetization moments to the fan and to our league and team and player association partners.
And they're great partners, all the leagues, all the players, associations, celebrities athletes and as we bring them closer to the fans, Through our , three unique businesses. That's never been done before and that's exciting and that's I think the biggest thing I'm focused on in the next couple years.
Yes, all of our businesses can get better, bigger, faster, stronger, and more efficient. Yes we have a lot of operational work to do. We've grown very fast, as you said. Shoot, I think our revenue in about a decade ago was 250 million million dollars. Last year we pierced through 7 billion, a nice trajectory over the last decade or so.
With that comes a lot of operational work that we're doing, just the raw art of getting something done and putting the pieces together and making it, making it efficient. And the the the financial controls and all that stuff that we're working through, and we'll get there.
That's just blocking and tackling. That's back to basics, if you will, of building and scaling a business. But what excites me the most is bringing it all together for the fan, giving the fan the best experience and hyperserving ─ that fan. Getting back to technology. Look, we could have done this podcast, seven minutes ago, seven years ago, 70 years ago.
And as the author or as the interviewer would have asked me about technology. I said, oh yeah it's scaling. It's a great neck pace. And that's just it. Technology always will enable you to move faster and more efficiently. And yes, we're embracing AI and yes, we're embracing automation.
And yes, we're focused on all that, but that's no different than at any other point in the arc of time. Yeah, at different points, the slope of technology is a little steeper, right? And I think we're on one of those steep points with AI and other automation tools. But business leaders have to keep learning, have to keep embracing, and you have to let technology do what it does best.
Which is drive efficiencies ─ and make for better, hopefully in our case, customer experience.
That's a really great point. Through different technology cycles, obviously new opportunities will be created. I do agree, I think we are in a unique position today. I'd love to talk about something that you feel is underestimated in the world today.
It could be about anything that we talked about prior. It could be something about your personal life, training, athletics.
There's a whole mess of megatrends that are going on, the world's going through a bit of a change, but it'll probably get too boring for you and your listeners on that.
The demographic shift in the world. Demographic used to be a tailwind, it's now becoming a headwind geopolitical stuff ain't fun the peace dividend over the last, what, 50 years is turning into a war tax, the structural deficits in every one of these economies isn't awesome , there's a whole mess of headwinds that for the last couple of centuries, the world's enjoyed tailwinds.
And we have to navigate, navigate through that. So I think all that's underestimated. If you focus on what you can control, that's probably a waste of time giving you all that monologue. But what's underestimated, I think I said it earlier, I think people should take more risk, personally in careers, don't take dumb risks but should take more risk. I think businesses should take more risk. And you have to set up your capital structure to take those risks and fund those risks properly. You have to take care of your personal situation to take more risk. And you have to understand when to take those risks where the odds are balanced in your favor. But, I think what's underestimated You know is, people should embrace risk and take more risk think that's one. And look, I think coextensive with that , is, the power of compounding.
We all understand that in terms of our personal finances, but you can apply that to business. Okay. And it's, a great business. is a great business that could absorb more capital and the returns on that capital increase over time by putting more capital into the business. And I think that's underestimated.
And we should all think about our businesses. Capital goes to where it's needed and it stays where it's rewarded. But what business can ingest more capital over time? And get increasing returns with that capital. That's a great business, okay. And I think we underestimate that.
Now it's easy for a CFO to say that it all gets back to capital. But I believe it does, . And if a business Can ingest that capital and get better returns on that capital. That's a wow moment. And that's a business that should be invested in more. And, we've talked years, for the last couple of years, as I thought about capital allocation, you starve your losers and you feed your winners and that's what I'm talking about.
I think that's underestimated business because often we do the exact opposite. We feed our losers under the whole bat. Under the supposition of that, under the belief that it's going to turn around, and often that's a fool's errand.
Great businesses tend to attract great talent. I was interested in learning how you attract talent here at Fanatics.
It's very nice that you've got such a clearly defined culture, I think that really helps. Other CFOs I've spoken to think that there's a big opportunity to improve how they're going about talent acquisition. Do you have any advice for them?
Look, it's that's a tricky one. I think that's going to get more tricky, where the unemployment rate is where immigration, some of the challenges around immigration.
So I think there will increasingly be a war for talent. Look, I think you have to have a place where people can grow. I think you have to have a one on one connection with people. And you have to give people uncapped upside. As I talk about with my businesses.
Always the topic of expense savings comes up in, in every CFO conversation. And I'm a big fan of that. And I'm a big fan of driving efficiencies. But, expense savings are finite. And revenue opportunities are infinite. So I'll apply that same theory to cultivating talent.
That you want to unlock the infinite in people, and worry a little less about the finite. So you attract people who can really 10x themselves. And, We do, I was joking with my son the other night, he's applying for all these, internships on Wall Street and he's going through all these tests, and these this, and these that, and these interviews, these profiles.
My head's spinning because I've hired hundreds of people for my career. I've never done one of those things and there's zero correlation between how you do in an interview and how you do in any of those tests how successful you are. I like to see track record of accomplishment, and even, when you're interviewing a kid in college Did you work?
Were you on a sports team? Okay. Did you get better every day? Were you intellectually curious? That's 10 times better than a test score. And then when you get those people, invest in them, challenge them, stay close to them. But it's tricky, hiring people is tricky.
And even the best of us who hire or the worst of us who hire, don't get it all right. And that's okay. It gets back to taking risks, like fail fast.
Of all the force multipliers that we've talked about, are there any non obvious force multipliers for Fanatics uniquely?
, I think it's what I said earlier it's bringing it all together, we have 100 million people in our database, nearly 80 million, a little over 70 million have purchased with us, lifetime to date. There's a cadre of fans, a number less than that. who interact with us on a repeated and ongoing basis. And we want to hyper solve those, and that'll be a force multiplier.
As I think about some of our early successes in gaming a lot of those people are coming from our commerce business. And when we look at the data of the people who, are gaming customers. There are better customers in commerce. They order more, hire AOV. So I think that's really the full force multiplier.
Like our businesses are strong. Each one of them are standalone, but our challenge, our opportunity, and our force multiplier will be will be bringing them all together. And then look, we talked about talent. Talent's the force multiplier. The difference between an A and a B person is not one grade, because an A person can 10x themself and can raise the bar, and often, You don't manage them to get them better.
You manage them to unlock them. A B player, you manage them to get better to an A player. So that's another forceful.
That's really exciting. One of the last things I want to talk about today is, this is a podcast, this medium's developing really rapidly. I really enjoy podcasts that are long form that get into deep dives of things that I'm interested in.
But with so much media being thrown at us on such a regular basis, I like to ask CFOs where they're getting and consuming and how they're curating all of the data that they're consuming. Just basically taking in at the same time, whether it's curating a really specific Twitter or XFeed or just your Wall Street Journal on your desk every morning.
Always interested to hear what people are reading and consuming.
Yeah, look, I'm old, as you probably know. I've been reading Wall Street Journal and Barron's since I was 12 or 13 years old. One of the things my parents did. Is they got a subscription to the Wall Street Journal. They used to rock up at the house, and I used to come after school and actually look at it.
I get all my information from the Wall Street Journal and Barron's. While I work out in the morning, I have CNBC on. And then, yeah, you get pinged by, a million people with with information, I, yeah, I'm old. I'm sitting in my ways and some of this stuff.
So I get it from the Wall Street Journal. And then look, I love reading, like love reading and love consuming information. I'm an empty nester now I'm not chasing kids on the baseball field to the tennis of scored or watching 'em run around the track. I read as many books as I can or audio books and just super intellectually curious.
And just pick up stuff that way.
My last question for you today is a lesson that you've just learned really recently in your career.
Oh, gosh. Really recently. I have no idea. I can't filter that. Look the there's, look, there's so many, there's so many lessons.
I've picked up. Look, the one that is tried and true, I think that's like the, that most people just don't. can't help themselves and just don't follow is listen more than you talk. It's so simple. When you're managing someone, they'll teach you how they want to be managed or how they need to be managed.
Some people, are a little scattered. So you want them to, put together an agenda when they come talk to you and you listen and you figure that out. Some people need more constant, reinforcement, so you have a daily stand up with them, or they're at some, this inflection point in their career where it's where they're, we're stepping into a new role, so a daily stand up to teach them is helpful.
Some people thrive on more informal conversation and that's great. But you need to listen, you need to understand and you can't just be waiting to talk, listening is an active exercise. Talking is an active exercise. And sometimes we all forget that. Right?
That's a great lesson that, I need to always remind myself of. But that's that's a forever lesson.
Thank you so much for joining me today, Glenn. Thank you for doing this in person after years of Zoom. It's fantastic to meet and I hope we can stay in touch, but thanks for joining another episode of the Modern CFO.
Outstanding. Thanks, Andrew.