Toptal Finance Blog

A decidedly less sexy, albeit critical, part of a CFO’s job description is working capital management and optimization. There are countless examples of companies that are forced to incur unnecessary debt and other financial obligations to meet their short-term financing needs, when in fact ample cash is sitting idly stuck in working capital.

But working capital optimization is hard to get right and often requires significant cross-functional efforts to execute effectively. In this article, Toptal Finance Expert Emilio Labrador draws on 25 years of professional experience across multiple industries to outline some of his main suggestions and approaches on how to tackle working capital management projects.

Renewable energy generation, lead by solar PV and wind power, is growing at a considerable rate. Innovations are lowering the cost to generate such power to levels of traditional fossil fuels. Yet underneath the positive headlines, there are some fundamental issues that remain in the long-term sustainability of business models in the industry.

Depending on your perspective, type, and motivation, the idea of building a board of directors either excites or intimidates you, complete with all associated imagery of aged oak rooms, brief-case wielding titans, and expensive cigars.

This article, by Toptal Finance Expert Orinola Gbadebo-Smith, sets out to debunk a few myths. It sheds light on boards as a construct, their workings, dealings, and nuances, and explores some battle-tested strategies for recruiting, building, and managing effective boards.

Fundraising is hard to get right, which is why companies of all sorts often turn to fundraising experts for help and advice regarding the fundraising process. There is a multitude of different professional figures that help companies raise capital, but for startups and growth companies, the two figures most often encountered are fundraising consultants and broker-dealers.

Despite many similarities between the two, there are some important differences that startup founders and company managers must understand if they are thinking of turning to one of these for help. In this article, Toptal Finance Expert Aleksey N. Krylov explores various features of both service providers and discusses the pros and cons of working with either one.

For a business manager, choosing what to invest in should not be an exercise of instinct. With capital budgeting methods, managers can appraise various projects simultaneously, with the end result indicating which one will have the highest impact on company value.

In his first article on the effects of the new US corporate tax reform bill, Toptal Finance Expert Jacob Wright assessed one of the most important impacts of the reform: the changes to interest deductibility. In this follow-up article, he runs through some further thoughts related to the effects on capital expenditures, in addition to a more high-level assessment of what the optimal capital structure of the future will look like given these changes.

It might be hard to imagine or remember, but there was once a time when going on a date with a stranger you met online was a strange concept—frowned upon, even. Today, however, millennials have led the charge on transforming the dating industry and making online dating universally accepted. In fact, a 2018 Statista survey revealed that 12% of 18-29-year-olds admit to being in a relationship with a partner they met online. And, consider that there are now over 1,500 dating apps or websites in existence.

Though matchmaking is one of the oldest industries in existence, online matchmaking is now having a moment of its own. This article explores the business of dating: the market size of dating apps in the U.S., the industry’s biggest players, and how these products actually make money (if they even do!).

Investment due diligence is a necessary process for both buyers and sellers to undertake to ensure the swift execution of their envisaged transaction. Although, with the stakes high, there are certain challenges that can arise throughout the process which, with careful planning and execution, can be mitigated.

The field of robotics has seen incredible strides forward in recent years. As a result of improvements in computer vision, dexterity and also overall economics, use of robots has increased in a variety of different fields. However, most of the growth in robotics so far has happened in industrial applications, and thus hidden from the view of the general public. But is this about to change?

In this article, Toptal Finance Expert Francesco Castellano focuses on the commercial robotics market. Thanks to recent breakthroughs in the fields of AI, mechatronics, sensors, and batteries, service and commercial robots are likely to see tremendous growth and adoption, likely heralding a new robotics revolution that could transform our daily lives in countless ways.

Popular rhetoric states that you need a team to found a startup. But what if you don’t have the desire or the right co-founders to start a new venture in a team? Contrary to popular belief, there are many successful solo ventures. This guide presents some tactics for solo entrepreneurs to follow when starting a solo venture.

In the life of almost any growing enterprise, there comes a point in time when the existing systems and processes become insufficient. Early-stage businesses tend to grow up with basic and low-cost software systems as well as a heavy reliance upon a few key administrative employees. Eventually, however, the software can’t keep up with the business, and the trusted employees become overtaxed.

For most enterprises at this key inflection point, implementing enterprise resource planning (ERP) software, which integrates all areas of the business, can help to overcome this issue. It’s a hugely consequential decision for the business and must be approached with an uninterrupted focus on risk management. While ERP may not be sexy, it is of utmost importance for growing businesses and should not be ignored. This article provides enterprise leaders with the benefits and risks of ERP, as well as a detailed step-by-step implementation guide.

LTV:CAC analysis is one of the most important exercises startup founders must go through to evaluate their business’ prospects and raise external funding. It is, however, frequently misunderstood and misinterpreted.

In this article, Toptal Finance Expert Ryan Downie runs through a practical tutorial of how to perform LTV:CAC analysis correctly, and how it should be adapted and interpreted depending on the business model or sector in question.

Finding out your return on investment from a project can become a subjective process with the myriad of returns measures and formulas that exist. This overview provides a breakdown and explanation of what type of return you need to measure and how to calculate it. With further guidance on how to use returns data to guide objective decision making.

Biotech companies with little to no revenue can still be worth billions. Consider the most prominent 2017 biotech M&A deal when Gilead bought Kite Pharma for almost $12 billion. At the time of the deal, Kite had over $600 million in accumulated deficit, but it also had a pipeline of CAR-T cell therapies, which treat cancer. This article examines how to value such pipelines. It also focuses on the risk-adjusted NPV valuation methodology, portfolios of multiple drug candidates, and how value is impacted by the characteristics of the investor or acquirer.

Convertible notes have become an increasingly popular and common method for raising capital by startups, but how well do founders truly understand the implications of going down this route?

In this article, Toptal Finance Expert Jeffrey Briggs outlines the basics of convertible note structures, and runs through the pros and cons of using them to raise money for new entrepreneurial ventures.

Traditional approaches to valuing real estate can lean towards the qualitative side, relying more on intuition over sound rationale. Linear regression analysis, however, can offer a robust model for using past transactions in an area, to provide better guidance on property valuations.

A monthly digest packed with information that will make you a smarter financial professional.

Every month, we bring you our top financial news insights, inspiring content and fascinating interviews packed with tips and advice from our top experts. In June, we dissect Mary Meeker’s slides (what is she telling us with just one slide on Crypto?), ponder invisible asymptotes, and interview Scott Brown on what makes an incredible Interim CFO.

Mergers and acquisitions are headline-grabbing events that are often the pinnacle of a CEO’s career. But they also often fail to generate value, as numerous studies over the years have shown.

With over 15 years of experience doing M&A deals, Toptal Finance Expert Javier Enrile shows that the main reason for disappointing results is simple: Most people think M&A is merely an exercise of agreeing on a price for the deal. What they fail to understand is that there is a science to doing M&A that often makes the difference between a deal being successful or not.

In this article, Enrile runs through three key tactics for ensuring your company can get the most value out of an M&A transaction.

Companies, like castles, need a line of defense to repel the invaders’ advances. Economic moats, taking a cue from their watery namesakes, are long-term and sustainable competitive advantages that protect others from seizing market share. But on the flipside, are they actually just lazy, passive strategies that shun innovation?

One of the most important and challenging aspects of forecasting is handling the uncertainty inherent in examining the future. Every CEO, CFO, board member, investor, or investment committee member brings their own experience and approach to financial projections and uncertainty, influenced by different incentives. Oftentimes, comparing actual outcomes against projections underscores the need to explicitly recognize uncertainty.

Monte Carlo simulations are an extremely effective tool for handling risks and probabilities, used for everything from constructing DCF valuations, valuing call options in M&A, and discussing risks with lenders to seeking financing and guiding the allocation of VC funding for startups. This article provides a step-by-step tutorial on using Monte Carlo simulations in practice.

In the current low interest rate environment, investors have been increasingly moving towards alternative asset classes, particularly private equity which continues to attract the lion’s share of investor capital. But could a relatively unknown, niche new asset class hold the key for outsized market performance?

In this article, Toptal Finance Expert Toby Clarence-Smith uncovers the world of search fund investing, reviewing some of the key aspects of the asset class from the investor standpoint as well as running through the main benefits of putting money to work in this space.