Five lessons from top digital platform CFOs 

Blue Apron specializes in online meal kits; Redfin specializes in online real estate. But these rapidly growing digital platform companies have plenty in common — each aims to disrupt the traditional way of doing business in their industries.

Blue Apron CFO Brad Dickerson and Redfin CFO Chris Nielsen, MBA ’96, met at the 14th annual MIT Sloan CFO Summit Nov. 17 to discuss their roles in a rapidly evolving digital world. Martin Trust Center for MIT Entrepreneurship lecturer Lou Shipley led the talk at the Boston Marriott Newton.

Here’s what they had to say:

Understand how to synthesize input
A CFO almost acts as a translator.

“For good CFOs to be successful, it’s not about control. It’s about influence, pulling people together, and building processes that get people to the table … I think the CFO is the connector. We have a unique perspective on the company. We see how everything comes together at the end in a financial statement. It gives us perspective,” Dickerson said.

Keep an open mind
In fast-growth companies, CFOs offer a steadying hand while retaining the spirit of entrepreneurship.

“It’s easy to be the ‘no’ person. If an idea is going to cost money, I [want to say] ‘no,’ but it’s important to provide the right framing, the right leash, and the right opportunity to allow things to be proved out,” Nielsen said. “Many ideas turn out to be important ones, and if we shut them down too early, they won’t work.”

Translate data into real-world solutions
While data engineering is often owned by IT, it’s crucial for CFOs to understand these metrics. At Blue Apron, which is 100 percent e-commerce, there’s constant interaction between the customer and the company, allowing them to track client preferences to boost their bottom line.

“We have a consumer talking to us every single day; we understand how our cohorts behave, and it allows us to know our demand much better and link it to supply much better,” Dickerson said.

For example: Blue Apron’s business model has 60 percent less waste than a grocery store, by some estimates.

“Waste is part of our analysis,” Dickerson noted. “The competitive advantage is what people do with [data]. You can hire engineers and get a ton of data, but the real value and the real differentiator is how you sift through it and bring it to light” — and use it to keep a company profitable.

React nimbly to change
“You need to be ‘special forces’ and not an aircraft carrier,” Dickerson said. “Imagine how long it would take to turn an aircraft carrier around, versus ‘special forces.’ Be nimble; adapt and change. [A CFO’s] view of the world changes weekly. Don’t build systems or budgets at a static pace.”

Maintain a long-range vision
There can be a trade-off between growth and profit, Nielsen said; ultimately, scalability is key, and every decision has impact.

“It’s a fine line to walk, where the seemingly simplest change can set off a cultural reaction that was unexpected,” said Nielsen. “It’s hard to navigate that — to keep the good and build on what needs to be better. When in growth mode, it seems everything is great, it’s all easy — a couple bad decisions are no big deal and growth will plow right over that. But if you put the wrong foundation down, fixing those things is difficult. These seemingly small decisions have a real tail to them.”