We’re Ellen and Simone. After 36 years in finance, we’re ready to share what textbooks won’t tell you.

💛 Welcome to CFO Playbook – your practical finance insights delivered bi-weekly. The full read will take approximately 5 minutes. Like what you see? Share it! Use the button below.

🇺🇸 The first part of our newsletter is in English, 🇩🇪 Weiter unten findest Du den Read of the Week auf Deutsch.

 ☀️ Summer Break Notice

Last CFO Playbook before summer break. We'll be back August 14. Enjoy the downtime!

Quick Survey

Your Feedback Matters! 1,000+ subscribers with 80% open rate after less than 1 year. Thank you! Before we pause: What's working? What should we focus on after summer? The survey takes just 1 minute – Click here to start

Want to sponsor CFO Playbook? 

Building something valuable for CFOs? Tools, services, insights? We're looking for partners that bring real value to finance teams. 📩 [email protected]

🇺🇸 READ OF THE WEEK

The EBITDA Trap: What It Doesn’t Tell You About Your Business

EBITDA still dominates investor decks, M&A teasers, and management reports. But if you’re treating it as your go-to profitability metric, you might be flying blind.

✅ It’s clean.
✅ It’s comparable (kind of).
❌ And it’s dangerously incomplete.

In a market where capital is no longer free and investors are demanding real returns, CFOs need more than cosmetic metrics. EBITDA might be easy - but it’s not enough.

Here’s the thing:

EBITDA is not profit. EBITDA is not cash. EBITDA is not enough.

1. The Rise of EBITDA: From Wall Street Darling to Default KPI

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) rose to fame in the leveraged buyout era. Private equity needed a quick way to gauge whether a company could cover debt payments.

It spread quickly: into investment banking, startup finance, even internal dashboards.

But its simplicity is exactly the problem. EBITDA strips away the very things that make businesses complex and expensive to run.

2. Seven Ways EBITDA Distorts Reality

1. “CapEx doesn’t matter”
→ EBITDA excludes depreciation - but machines, servers, and warehouses wear out and in the future you’ll need to reinvest.

2. “These costs are one-off”
→ Are they though? It’s important to look closely—many companies toss recurring or operational expenses into the “one-off” bucket to clean up EBITDA. Not every “exceptional” item truly is.

3. “It’s great for comparison”
→ There’s no GAAP standard for EBITDA. That means comparisons across peers are often meaningless. 

4. “Debt is under control”
→ Interest payments are real. EBITDA ignores them completely. This can distort leverage and risk profiles - especially dangerous in high-rate environments.

5. “It’s great for bonus plans”
→ Bad idea. Tying incentives to EBITDA can fuel short-termism, inflated revenue at any cost, and misaligned priorities. A better approach? Base rewards on actual cash generation - think Operating Cash Flow or Free Cash Flow. It’s harder to manipulate and aligns incentives with long-term health.

6. “Working capital isn’t a concern”
→ EBITDA excludes swings in receivables, payables, and inventory. Your EBITDA might look great, while your cash position is sinking.

7. “Valuation based on EBITDA is fair”
→ Only if you ignore CapEx needs, debt, and liquidity. Relying on EBITDA multiples alone? You’re likely overpaying - or ov

Before we jump into real-world cases, here are a few red flags every CFO should watch for when EBITDA looks “too good”:

3. Real Talk: When EBITDA Breaks Down

Let’s be practical. EBITDA might look great in a slide deck - but it won’t save you when cash runs dry.

Take two high-growth, investor-loved businesses:

🚲 Peloton (2020-2022)

Peloton showed strong EBITDA during its pandemic-fueled boom. But CapEx-heavy investments in manufacturing, ballooning inventory levels, and operational inefficiencies drained cash. When demand normalized, the underlying fragility surfaced - leading to layoffs, write-downs, and a crash-course in liquidity management.

📦 Zalando (Growth Phase)

During its rapid growth years, Zalando reported impressive EBITDA - rising to over €700 million by 2024. But behind the scenes, major investments in logistics, tech infrastructure, and inventory tied up large amounts of cash. Despite strong earnings on paper, high CapEx and working capital repeatedly pressured liquidity. In several years, free cash flow even dipped negative, showing that healthy EBITDA doesn’t equal financial flexibility.

The common thread?

💡 Both businesses showed strong EBITDA.
❌ Neither could pay the bills with it.

In each case, leadership needed better answers to simple questions:

• What does it really cost to serve a customer?

• What’s our cash conversion cycle?

• Can we reinvest without raising again?

👉 If EBITDA doesn’t help you answer those, it’s not your friend.

4. What to Use Instead: Your Profitability Reality Check

EBITDA may still be the headline metric in investor decks, but it’s time for CFOs to go deeper.

Here’s what should be on your dashboard if you want to understand real performance, resilience, and reinvestment potential:

✅ Free Cash Flow
→ The most honest view of how much cash your business actually generates - and keeps.
→ Ideal for assessing the capacity to reinvest, repay debt, or survive downturns.

✅ Operating Cash Flow Margin
→ How much of each euro/dollar of revenue turns into actual operating cash?
→ A cleaner lens on operational efficiency than EBITDA.

✅ Unit Economics
→ The clearest picture of profitability at the customer/product level.
→ Ask: Are we making or losing money - per unit? [👉 Want to go deeper? Read our newsletter on Unit Economics: Wanna Fail Your Business? Ignore Unit Economics.].

✅ Cash Debt Service Coverage
→ Can we cover our financial obligations without tapping external funds?
→ Essential for managing risk, especially in rising interest environments.

✅ EBITDA works for:

• Asset-light businesses like SaaS or professional services.

• Stable cost structures with predictable margins.

• Early-stage comparisons when CapEx and debt are minimal.

❌ EBITDA is risky for:

• CapEx-heavy models like manufacturing, logistics, or infrastructure.

• Highly leveraged companies - especially in a rising interest rate environment.

• Any business with volatile working capital or deferred maintenance.

🔧 CFO Survival Kit: What Belongs in Your Next Board Deck

Don’t just report EBITDA - contextualize it. Here's what your board should see side-by-side:

• EBITDA AND Free Cash Flow → Show the real gap between “earnings” and spendable cash

• Cash Conversion Cycle (CCC) Trend → Reveal whether growth is tying up liquidity

• Debt Service Coverage Ratio → Demonstrate the company’s ability to meet its obligations from operating cash

  
  👉 Use these in combination to tell a complete, cash-aware story that goes beyond vanity metrics.

5. The Mirage of “Adjusted” EBITDA

Ever reviewed a pitch deck boasting Adjusted EBITDA and thought, “Wait… adjusted for what exactly?”

Let’s decode that.

Adjusted EBITDA often starts with standard EBITDA and then adds back everything inconvenient:

• 🧠 Stock-based compensation

• 💼 Executive departures

• 💸 “Strategic” marketing blitzes

• 📉 Restructuring costs

• 🔧 Anything labeled “non-recurring”- even if it recurs annually

These adjustments might be valid in isolation. But when the list grows longer than your P&L, it’s no longer a normalization it’s a narrative.

CFO Checklist

• ✅ Ask what’s included, what’s excluded, and why

• ✅ Scrutinize consistency across periods

• ✅ Pressure-test with cash flow: would these costs show up in your bank account?

Because if you need to adjust your EBITDA every quarter to make it look healthy, it might not be your EBITDA that needs fixing.

🍹⛱️🌴The CFO’s Summer Stack: Podcasts, Books, and Fresh Perspectives

Need a break from models and metrics? We’ve got you.

Whether you’re unplugging at the lake or commuting through Q3 planning, here’s what we recommend packing this summer.

🎧 Podcast Picks

• 🎙️ My First Million: Shaan & Sam deliver business ideas, strategy breakdowns, and wild founder stories with a side of entertainment. You’ll learn and laugh.

• 🎙️ Open AI’s Controller on how AI can transform Accounting 

• 🎙️ Business Punk - How to Invest: Host Sherin Maruhn sits down with tech veteran and Project A founder Florian Heinemann to explore how VC and PE are evolving.

📚 Summer Book Stack

Wishing you a relaxing, inspiring, and sun-soaked summer ☀️
We’ll see you back in August - recharged and ready to dive in again. Until then: enjoy the pause, skip the spreadsheets (just for a bit), and soak up the good stuff.

🌐 Finance Collective DACH

Your go-to CFO Network

(by Simone)

🇩🇪 READ OF THE WEEK

Die EBITDA-Falle: Was die Lieblings-KPI vieler nicht verrät

EBITDA dominiert weiterhin Pitch Decks, M&A-Teaser und Management-Reports. Aber wer EBITDA als Hauptkennzahl für Profitabilität nutzt, schaut womöglich an der Realität vorbei.

✅ Klar strukturiert.
✅ (Ziemlich) gut vergleichbar.
❌ Aber auch hochgradig irreführend.

In einem Umfeld, in dem einem das Funding nicht mehr hinterhergeworfen wird und Investoren echte Ergebnisse sehen wollen, brauchen CFOs mehr als oberflächliche Erfolgskennzahlen. EBITDA mag bequem sein - aber es reicht nicht.

Denn: EBITDA ist kein Gewinn. EBITDA ist kein Cash. EBITDA ist nicht genug.

1. Der Aufstieg von EBITDA: Vom PE-Liebling zur Standardkennzahl

EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) wurde im Private Equity populär – um schnell abzuschätzen, ob ein Unternehmen seine Schulden bedienen kann.

Von dort aus verbreitete es sich in alle Richtungen: Investmentbanking, Startups, Controlling-Dashboards.

Das Problem: Die Einfachheit ist auch seine größte Schwäche. Denn EBITDA lässt genau die Faktoren weg, die den Unterschied zwischen Wachstum und Überleben ausmachen.

2. Sieben Irrtümer rund um EBITDA

1. „CapEx ist irrelevant“
→ EBITDA ignoriert Abschreibungen - aber Maschinen, Server & Lagerhäuser müssen früher oder später ersetzt werden.

2. „Das sind Einmaleffekte“
→ Wirklich? Viele Firmen stecken wiederkehrende oder operative Kosten gerne in die „One-Off“-Schublade. Genau hinschauen lohnt sich - nicht jeder „Ausreißer“ ist wirklich einer.

3. „Super zum Vergleich“
→ Leider nein. Es gibt keinen GAAP-Standard für EBITDA - die Definitionen variieren. Vergleiche zwischen Unternehmen? Oft wertlos.

4. „Unsere Verschuldung ist kein Problem“
→ Zinszahlungen sind real - und EBITDA ignoriert sie. Gerade bei steigenden Zinsen ein riskanter Blindspot.

5. „Perfekt für Bonuspläne“
→ Gefährlich. Wer Boni an EBITDA knüpft, fördert kurzfristiges Denken, Umsatz um jeden Preis und Fehlanreize. Besser: Auf echten Cashflow setzen - Operating oder Free Cash Flow lassen sich schwerer frisieren und zeigen, was wirklich zählt.

6. „Working Capital? Kein Thema“
→ Doch. EBITDA ignoriert Forderungen, Verbindlichkeiten und Lagerbestand. Die Liquidität kann kippen, auch wenn das EBITDA (noch) glänzt.

7. „Valuation auf EBITDA-Basis ist fair“
→ Nur wenn man CapEx, Schulden und Liquidität großzügig ausklammert. Sonst zahlt man zu viel - oder glaubt an ein Geschäftsmodell, das es gar nicht gibt.

Bevor wir zu den Praxisbeispielen kommen, hier die wichtigsten Warnsignale:

3. Real Talk: Wenn EBITDA nicht reicht

Zwei Beispiele aus der Praxis:

🚲 Peloton (2020–2022)
Starkes EBITDA während des Pandemie-Booms. Aber hohe Investitionen, aufgeblähte Lagerbestände und ineffiziente Prozesse ließen den Cash Flow wegbrechen. Ergebnis: Restrukturierungen, Entlassungen, Abschreibungen.

📦 Zalando (Wachstumsphase)
In der Hochwachstumsphase stieg das EBITDA auf über 700 Mio. Euro (2024). Doch hinter den Kulissen: Hohe Investitionen in Logistik & Tech und wachsendes Working Capital. In manchen Jahren rutschte der Free Cash Flow sogar ins Minus - trotz starkem EBITDA.

💡 In beiden Fällen: Solides EBITDA.
❌ Aber zu wenig Luft zum Atmen.

Die entscheidenden Fragen, die EBITDA nicht beantwortet:

• Was kostet es wirklich, einen Kunden zu bedienen?

• Wie lange dauert unser Cash Conversion Cycle?

• Können wir wachsen, ohne neues Kapital?

👉 Wenn EBITDA das nicht beantwortet, hilft es dir nicht weiter.

4. Was CFOs stattdessen tracken sollten

Wer wirklich wissen will, wie’s um Profitabilität & Cash steht, braucht mehr Kontext. Das gehört ins CFO-Dashboard:

✅ Free Cash Flow
→ Zeigt, wie viel Cash tatsächlich verfügbar ist – zum Investieren oder für die Runway.

✅ Operating Cash Flow Margin
→ Wie viel operativer Cash bleibt pro Umsatz-Euro übrig?

✅ Unit Economics
→ Der ehrlichste Indikator: Verdienen wir an jeder Transaktion?

✅ Cash Debt Service Coverage
→ Reicht unser operativer Cash Flow, um Kredite zurückzuzahlen?

💡 Wann ist EBITDA ok?

✅ Geeignet für:

• Asset-light Modelle (z. B. SaaS, Services)

• Frühphasen-Vergleiche ohne großen CapEx oder Schulden

❌ Riskant bei:

• CapEx-intensiven Geschäftsmodellen

• Hoher Verschuldung bei steigendem Zinsniveau

• Unternehmen mit stark schwankendem Working Capital

 🔧 CFO Survival Kit – Was ins Board Deck gehört:

• EBITDA & Free Cash Flow nebeneinander

• Cash Conversion Cycle im Zeitverlauf

• Debt Service Coverage Ratio

  👉 Nur so entsteht ein vollständiges Bild – und nicht nur hübsch aufbereitete Kennzahlen.

5. Die Illusion von “Adjusted” EBITDA

Pitch Decks lieben „Adjusted EBITDA“. Aber was steckt drin - oder besser: was wurde rausgerechnet?

Typische Add-backs:

• 🧠 Mitarbeiter-Aktienoptionen

• 💼 Führungswechsel auf C-Level & Restrukturierung

• 💸 Marketing-Offensiven mit „strategischem“ Etikett

• 📉 Verluste aus Investments

• 🔧 „Einmalige“ Kosten, die doch öfter auftauchen

Einzeln okay - in Summe problematisch. Denn: Wenn deine Adjusted-Liste länger ist als die GuV, hast Du ein Storytelling-Problem, kein EBITDA-Problem.

CFO-Checkliste

• ✅ Was wurde einbezogen, was weggelassen – und mit welcher Begründung?

• ✅ Sind die Add-backs konsistent über Zeiträume?

• ✅ Würden die Kosten auch im Cash Flow auftauchen?

CLOSING REMARKS

Thanks for reading 💛

Send your feedback, suggestions, or requests to feature something in future editions to [email protected]. We’d love to include your input.

Follow us on LinkedIn for more updates!

CFO Playbook reflects our personal opinions, not professional advice.