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Aug 11, 2020

GM's chief financial officer resigns to join fintech startup Stripe

GM

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General Motors Co.’s chief financial officer is stepping down after two years to take a job at financial technology company Stripe Inc. in an unexpected move depriving it of a rising star and one of the auto industry’s few senior female executives.

GM said Tuesday that Dhivya Suryadevara, who had served as CFO since September 2018, is resigning and that it will start a search for her successor immediately. Suryadevara will join closely held Stripe as its CFO, the San Francisco-based company said.

Suryadevara’s departure leaves GM without a talented executive who oversaw its finances during last year’s strike and a pandemic-induced factory shutdown earlier this year. At 41, she was one of the youngest leaders on Chief Executive Officer Mary Barra’s team.

The high-level departure from the blue-chip automaker for a 9-year-old tech company comes as Detroit faces an uncertain outlook amid falling demand and the ascendancy of electric-vehicle leader Tesla Inc., whose valuation dwarfs GM’s roughly US$41.5 billion market capitalization.

“I am grateful for the opportunities I have been given at GM,” Suryadevara said in a statement. “While I look forward to a new opportunity that will allow me to apply my skills in a new sector, I have great confidence in GM’s trajectory and future.”

Most Valuable Startup

In April, Stripe raised US$600 million from investors including Andreessen Horowitz, General Catalyst and Sequoia Capital. The round gave Stripe a valuation of US$36 billion, making it one of the most valuable startups in the U.S. and a hair’s breadth from GM’s, according to CB Insights.

The company has been in growth mode during the global pandemic and expanded to five new European Markets in May. That fast growth and its high valuation has made it a top candidate to go public. Hiring a prominent CFO is often a step companies take as they advance in preparations for an IPO and need to make a strong case to potential investors, but the company denied it’s going public.

“We have no plans to IPO,” a Stripe spokesperson said in an email.

Adam Jonas, an analyst at Morgan Stanley, said the shakeup in GM’s senior ranks is a blow to the company and indicates the struggle automakers have cultivating and retaining executive talent. “Suryadevara was highly regarded by investors and, in our opinion, is a material talent loss to GM at a sensitive time in the company’s history,” he wrote in a note to investors. Jonas called a brain drain of capable leaders the “biggest challenge facing Detroit.”

GM named John Stapleton, its North American finance chief, acting CFO as of Aug. 15 while it conducts a search for an internal or external candidate to take on the job in permanent capacity.

Stapleton is a GM veteran who has been responsible for the automaker’s most important business unit, Credit Suisse analyst Dan Levy said in a note published Tuesday.

Tumultuous Tenure

Suryadevara ran GM’s finances through a successful and also tumultuous period capping her 16 years at the company, starting as an analyst in its treasurer’s office. She leaves at the end of the month, said a GM spokesman.

She was a key player in GM’s cost-cutting moves in 2019 that closed three plants, cut 11,000 jobs in order to save US$4.5 billion. The savings kept profits aloft even as auto sales stagnated.

Her tenure also included a 40-day labor strike that cost the company US$2 billion and, more recently, almost two months of plant shutdowns due to the Covid-19 pandemic.

Suryadevara initiated cash-saving moves during that time, which resulted in smaller-than-expected losses in the second quarter. GM has told investors it will likely return to profit in the second half of this year.

GM shares rose 3.7 per cent to US$29.03 as of 12:55 p.m in New York.