10 questions for Fonality CFO Dan Rosenthal

Education: Bachelor of Science, electrical engineering; Bachelor of Science, business, Carnegie-Mellon University; MBA, Wharton

I started my career as an engineer, doing product management for a line of custom semiconductors in Silicon Valley. It was quickly obvious that I wasn't near a good enough engineer to make it far, nevertheless I had an aptitude for looking at the business holistically -- from research, product, sales, manufacturing, etcetera. So, I went back and got an MBA, did management consulting for tech businesses for a number of years, and at the time wound up as a venture capital investor evaluating, investing in and managing small research businesses. Afterwards a few years, I thought I'd "put my money where my mouth is" and join a company instead of just investing in them -- that landed me at Fonality when we were just seven people. We all sort of had to pick jobs, and since I happened to be the one with the MBA, I got to be CFO! It was a bit of a learn-on-the-job situation.

Well, anyway you look at it, access to capital is the number one challenge. For private companies, like Fonality, the entire venture capital market has changed over the past 10 years and the whole process is more difficult. Sure, there are the hype-driven "successes" like some of the social media guys out there, however those are by a long way the exception in other words than the rule. To tell the truth, in many cases, the more revenue and clients a company has, the harder it can be to raise venture capital -- when there's nothing to put a multiple on, valuation is a guess and can easily get bid up. When Fonality was first raising outside capital, we called our already-significant revenue base "painting our own ceiling."

Having grown up in management consulting, I tend toward the "case interview" style of questions, where I lay out a specific business situation and ask the candidate how they would resolve it. I'm always looking for creative thought processes, quick thinking and a drive toward completion, in other words than a specific "right" answer.