CarParts.com’s CFO and COO is the next CEO. He’s betting big on parts for EVs

David Meniane drives a 2017 GMC Canyon pickup truck, he told me. He just bought a JC Whitney aluminum tonneau cover and windshield wiper blades from CarParts.com, the company where he was recently named CEO.

For the past three years, the 39-year-old exec has served in both roles of CFO and chief operating officer (COO) at CarParts.com (Nasdaq: PRTS), an online provider of aftermarket auto parts. A few days ago, we had a chat about his promotion to CEO, effective on April 18 and what’s on the horizon.

“First on my agenda is to spend as much time in our operations as I can,” Meniane says. “It’s going to be visiting all our warehouses, visiting our team in the Philippines, and then meeting with our vendors, if I can, in Taiwan and in China.”

As car prices remain high and the global chip shortage fueled by the pandemic continues, many drivers are maintaining their existing cars. That has been an advantage for CarParts.com, based in Torrance, California. In three years, the company’s annual revenue has doubled from $280 million to $582.4 million, and its gross margin has improved from 30% to 33.8%, Meniane says.  

“We went from two fulfillment centers to six fulfillment centers,” he says. “With the new one that’s going live in the second quarter of this year in Jacksonville, we will be able to cover 55% of the country within one-day shipping,” he says. 

His growth expectations for this year? “We feel comfortable that we’re going to keep growing our top line at a 20% to 25% compounded rate,” Meniane says. “That’s going to be driven by investments in additional fulfillment centers, as well as growth in inventory, but also expanding our assortment.”

CarParts.com announced on March 15 that Lev Peker will step down as CEO and director, effective April 15. Peker is pursuing other business opportunities, the company stated. “David has been an integral part of the company’s transformation and he intimately knows the business, having built, among many other things, a vertically integrated supply chain and the company’s data science team,” Peker, who joined the company in 2019, said in a statement.

I first spoke with Meniane in February. He talked about how the company built its own supply chain and how data science was key. I asked him if that focus will continue.

“Absolutely,” he says. “I think you’re going see us double down on data science. We’re constantly looking to hire data scientists and data engineers. We have four PhDs on the team, and over the next couple of years, we’re going to have more than that.”

“If you look at our business, historically, we were very heavy on replacement parts,” he continues. “And now, we’re making big bets on, number one, mechanical parts, and number two, parts for EVs and hybrids.”

‘Too many companies have CFOs operate in a vacuum’

The path from finance chief to chief executive is becoming more common. “Many of the CFO searches that I conduct are very explicitly CEO succession planning engagements,” Alyse Bodine, partner and global managing partner at Heidrick & Struggles, told me last month. But research shows it’s not always a smooth path. A recent report by Spencer Stuart found CFOs can underperform as CEOs. In comparison to promoted COOs, divisional CEOs, and leaders advancing from below the C-suite, finance chiefs can over rely on the numbers.

In Meniane’s case, serving as the CFO and COO at CarParts.com, gives him an advantage, he told me. “I think too many companies have CFOs operate in a vacuum,” he says. “And we think that the CFO should be in the business, and in the trenches meeting with the people.”

Ryan Lockwood, the SVP of finance at CarParts.com since 2020, will become CFO. “After experiencing our eighth consecutive quarter of year-over-year sales growth, I believe in our ability to execute on our long-term growth strategy and disrupt a $300B industry,” Lockwood said in a statement.

“I had a fantastic partnership with Lev,” Meniane told me. “And now I’m looking forward to a great partnership with Ryan.” He’s also keeping his new leadership role in perspective. “I think a lot of people focus on the guy at the top,” Meniane says. “But we have 2,200 people in our company today. And each of them is really the driving force for building an exceptional business.”


Enjoy your weekend. See you on Monday.

Sheryl Estrada
sheryl.estrada@fortune.com

Big deal

ISACA's State of Cybersecurity 2022 report focuses on the current trends in cybersecurity workforce development, budgets, and the threat landscape. About 82% of respondents said their leadership team sees value in conducting a cyber-risk assessment. However, just 41% said their organizations perform an annual cyber-risk assessment. Regarding workforce development, there are hiring challenges, the report found. About 63% of respondents said their organizations have unfilled cybersecurity positions, an increase of eight points from last year's survey. And most cybersecurity teams are understaffed (62%). Fewer organizations require university degrees for entry-level positions compared to last year's survey, the report found. The findings are based on a survey of 2,031 cybersecurity professionals. ISACA is an international professional association focused on IT governance.

Courtesy of ISACA

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Leaderboard

Andrea Bonini was named CFO at Prada Group, effective May 2. Bonini will succeed Alessandra Cozzani who has been CFO since 2016. Cozzani has decided to leave the company for other professional opportunities. Bonini was previously managing director of the investment banking unit at Goldman Sachs International in London.  

Regina Buckley was named chief financial and strategy officer at Hearst Magazines. Buckley will oversee the financial and strategic planning processes across the business. Buckley joins Hearst Magazines from the Guardian News & Media LLC, where she served as president of the North American division for the past two years. Previously, she was CFO and COO for the division, a position she held since 2018. Prior to joining the Guardian, she held several senior level roles at Time Inc.

Eric J. Martin was named CFO at United Fire Group, Inc. (Nasdaq: UFCS), effective April 18. Martin was most recently the head of enterprise transformation at Transamerica. He also held numerous other positions at Transamerica including: COO, Individual Solutions and Retail Affiliates; SVP, controller and head of finance; president, Transamerica Business Services; SVP, chief accounting officer; SVP, director of finance; VP and controller; and corporate division controller.

Pedro Almeida Pereira was named CFO and chief business development officer at energyRe, a developer of renewable clean energy solutions. Before joining energyRe, Pereira was the global head of business development at EDP Renewables. He also served as the director of finance at EDP Renewables North America.

Michael A. (Mike) Riordan was promoted to CFO at FreightCar America, Inc. (Nasdaq: RAIL) effective March 21. Riordan has served as the company’s corporate controller and chief accounting officer since November 2020 He replaces Terence R. (Terry) Rogers, who joined FreightCar America in early 2021. Prior to joining FreightCar America, Riordan was controller at InnerWorkings and served in several financial management positions at Wheatland Tube, LLC. He also held various positions at PricewaterhouseCoopers.

Adam Towns was named CFO at Dataiku, an artificial intelligence and machine learning company. Before joining Dataiku, Towns served as the CFO of Sisense, where he led the company’s global finance and business operations team. Before that, he was SVP of strategic finance and FP&A at Mimecast, managing the company through a successful IPO in 2015.

Overheard

“Everyone has heard that gas prices continue to rise. The advantage this has for us is that it will increase application flow and has the potential to lower our average wage.”

—That's what Wayne Pankratz, the executive director of operations for Applebee's franchise, wrote in an email to fellow executives. The email was leaked and uploaded to Reddit and is creating a stir, as reported by Fortune

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