Scaling New Heights: The Rise of the Private Equity Backed CFO

CFO Magazine’s Emma Foster had the opportunity to sit down with Tochau Nguyen, CFO at Buildsafe, an innovative leader in the height safety industry, with 400 Employees across Queensland, NSW & Victoria, to discuss the growth of the business and her role as a Private Equity backed CFO.

Tochau Nguyen concedes that it takes a CFO with “a certain personality type” to succeed in a business backed by private equity investors.

“In comparison to other private companies, I would say the biggest difference when you’re backed by private equity is the pressure for outperformance,” says Nguyen, who joined construction equipment provider Buildsafe as CFO in 2022, the year after private equity firm Colinton Capital Partners took a controlling stake.

“If the company is doing well, the private equity firm will want more, and the second you’re even slightly under budget, the pressure dials up,” she says. “And from a reporting perspective, it’s almost like you’re listed in terms of the volume of requirements, with intense scrutiny over your reporting, as there should be. You’ve got to really be open to that, open to feedback and to be quite resilient.” 

Lucky for Nguyen, it’s an environment in which she thrives. “At the end of the day, it’s making me better at the job and it’s making the company better,” says the Brisbane-based finance professional who has previously held senior finance positions with the likes of technology company HTG Solutions, QSuper and KPMG.

“It also gives me access to these very intelligent, highly skilled, experienced people in the PE firm, in addition to our internal teams,” she says. “If there’s something I’m struggling with, I can ask, ‘What’s your experience with this? Do you reckon this is the right data set to use?’ They are all very approachable and happy to share their insights and there’s a team of analysts who we can also tap into if we need nitty gritty details or templates, or just to bounce ideas around. It’s rare to have access to that and it’s wonderful for my team.”  

Nailing knowhow

Despite having very little knowledge of the construction industry, Nguyen says she was attracted to the role at Buildsafe after meeting the founders – Peter Horton, Milton Young and Grant Edwards who have remained involved with the business – and the CEO since 2022, Joe Potter.   

“They had a strategy in place, they knew how big they wanted to grow, and they had the backing to do it,” she recalls. “They wanted to create new products, they wanted to be as agile as possible, and they needed someone to firm up the finance functions and smooth out the back-end processes to be ready to support that growth. It was a great opportunity.” 

Since starting up in 2001 in Melbourne with one truck, three blokes and a bit of gear, Buildsafe has grown to become a leading provider of height safety solutions to the residential construction sector spanning the east coast states of Australia. With a current fleet of around 170 trucks, it hires out equipment such as scaffolding, fall-guards, walkway systems, platforms and temporary fences to the likes of Metricon, Mirvac, Coral Homes and Brighton Homes.

Nguyen says the founders achieved their biggest growth surge just before COVID hit, when they’d opened a head office on the Gold Coast at a time that the Queensland residential industry was “going gangbusters”. With an eye to double down on this growth by capitalising on ongoing demand for housing particularly in Queensland, the founders made the decision to bring in investors in 2021. Since then, revenue has lifted from $90 million to a forecast of over $120m, and market share is up around 8 percent and rising.

Firming up foundations

Nguyen’s initial focus upon joining was on tackling the many manual processes that were slowing things down. “But now we’re at a point where we’ve automated as much as we can and I’m pretty happy with how things are running,” says Nguyen, who was named last year’s Professional Woman of the Year in the 2023 Awesome Women in Construction awards.

“We now have the runway to build up the value-add of the finance team to the business – moving from a focus on historical accounting, more towards forecasting and predictive analytics so we’re giving advice about what’s coming and how it’s going to hit us.”  

Platform for growth

With a remit that stretches across oversight of procurement, facilities and the fleet of trucks in addition to the typical finance functions, Nguyen dedicates a big part of her and her team’s time to visiting the 15 branch sites and many customers spanning the east coast. 

“It gives me a chance not only to get amongst the action but to let the branch managers know that the finance team isn’t just here to police performance, and we don’t just run the payslips – we’re actually here to help them run their branch more effectively,” she says. “I’m really proud of the fact that our finance team is now known and well-regarded right across the business.”

Nguyen is also knee-deep in the operationalisation of an innovative new product for Buildsafe customers, which leverages onsite video cameras.

“We think of the cameras like site supervisors,” she explains. “Let’s say you’re a construction manager who is overseeing 20 sites, which makes it difficult to travel to all of them. We’ve started offering to install cameras on the sites to give the manager a real-time view of all their builds. What we’re adding to that is AI-powered event tagging. So, if, say, a tiler is due to arrive at a certain time, that event will be tagged to help our customers know whether or not their suppliers have arrived, helping them to gauge if the build is running to schedule.” 

This initiative, along with a step-up in customer engagements, are supporting continued market share growth, she says.

Hammering away

Nguyen reflects that the distinct challenges she’s stepped up to in the PE-backed environment at Buildsafe – from the occasional need to play the diplomatic role of mediator between PE investors and founders when expectations of performance clash, through to the robust discussions during scenario analysis with the board – have “reinvigorated” her career aspirations.    

“I’ve learnt that I’ve got the numbers down pat, and I’m quite operational in nature – I really like to see how things work and how I can make things better. So, for me, I can see that over the next, say, decade, a transition from CFO to COO will probably be the next step and after that, a CEO role,” she says. “I’m also doing my company directors course later this year; getting a position on a board is definitely something I would love to do.”  

Meantime, as Buildsafe approaches the half-way mark of the typical five-year timeframe that private equity investors generally set to improve performance before exiting, she is excited to play a key leadership role in keeping the foot on Buildsafe’s accelerator. 

Tochau will be speaking at the upcoming CFO Magazine Sydney CFO Symposium > Thursday 26th September 2024 > To learn more and register visit: www.NSWCFOSymposium.com