Putting your money in a company listed on the Alternative Investment Market is much like placing your chips on black in a casino, if you believe some commentators.

Accusations of an unregulated market where anything goes have been flying across from the other side of the Atlantic, but these are firmly refuted by those at the sharp end ­ the directors of AIM companies, their advisers and investors. And it is not a staging post for those looking to move on to larger pastures.

Often the opposite is true ­ many finance directors of AIM-listed companies began corporate life with companies on the full list, but have been lured to AIM by the prospect of helping a business grow and develop.

‘AIM was always seen as a second division, but it has really moved on,’ says Douglas Kearney, FD of SovGEM, an AIM-listed emerging market finance provider.

‘There were institutions that were a bit sniffy about it but they have now joined the club and participate in deals.’

He agrees that these days, institutional investors see little difference between an AIM-listed company and a smaller company on the full list. ‘I can’t imagine that any institution would turn around now and say we won’t invest because it is AIM,’ Kearney says.

End of the stigma

The same is true for finance professionals looking for the next step in their career ­ few would dismiss an opportunity purely because of the market that the company was listed on.

‘I wouldn’t see it as a natural stepping stone [to a FTSE company] because often, by the time they come into a CFO position, people have concluded that they either want to be with a medium-sized AIM company or they want to be with a very large FTSE company,’ says Steve Maslin, head of external professional affairs at Grant Thornton, the largest adviser to AIM companies.

‘Quite often they might have gone through the route of qualifying with one of the large audit practices, moving through the finance team of a large company and then moving up, or they might have decided that they prefer the benefits of an AIM company.’

These benefits, according to Maslin, include a greater opportunity for a hands-on role in formulating a company’s strategy. He adds that CFOs will often achieve their ambitions by helping a company grow, rather than seeing it as a stepping stone to a larger company.

So although they might not be mutually exclusive, it seems it takes a different breed of professional to step up to the CFO plate at an AIM company rather than a larger listed group. Nor is it a soft option. As Maslin says: ‘I don’t think any CFO has been tempted to move to an AIM company because they thought they would get an easy ride.’

Clive Davis, regional director at recruitment firm Robert Half International, looks for certain qualities when searching for an AIM finance chief. ‘The number one request from all of the organisations we have worked with was strong negotiation and presentation skills,’ he says, ‘because a large proportion of their time is involved in negotiations with banks. The difference would be found in their ability to communicate in what can be fairly tough and detailed negotiations.’

And who would be attracted to such a role, which can be fast moving and under-resourced? ‘We often find that people who have worked their way up can be particularly interested in these opportunities,’ says Davis.

‘They see it as their opportunity to be part of a seed that will go on to become a larger plc,’ he adds. So in this respect, such a move could be seen as a stepping stone, but in this situation the FD moves with the whole company.

Matthew Turnock, FD at AIM-listed Fountains, an environmental services group, agrees. ‘Managing smaller companies through growth phases is an extremely challenging environment, which requires very particular skillsets.’ But, like many of his peers, he is keen to stress that AIM is not, in his words, ‘a training ground’.

Do you have what it takes?

Time management: As Fountains FD Matthew Turnock says: ‘There is a lot that you need to learn around personnel management and personal time management as it is very easy in a position like this to be get totally swamped.’

Principles: No matter what size company you work for or where it is listed, you still have responsibilities, according to Grant Thornton’s Steve Maslin. ‘Always stick to your principles as you only have one chance to make a first impression.’

Thick skin: FD at SovGEM, Douglas Kearney, says: ‘On a public market you are exposed, people can be quick to criticise.’

Business agility: ‘You will be less well resourced and you have to be prepared to role up your sleeves and get stuck in. This can be quite a challenge if you have come from a large firm,’ says Maslin.

Don’t ignore the fundamentals: Irrespective of the regulatory regime, lighter or otherwise, you still have a business to run. Turnock says: ‘You need strong sales pipeline, work that is executed profitably, get the bills out of the door promptly, and remember cash is king. Anyone in a new position needs to make sure they have got a handle on that cycle, right from the sales side through to the cash being in the bank.’

Don’t miss the opportunity: ‘We speak to senior finance professionals who have been happy with their careers who say they would have liked to have been involved in an AIM-listed company. It can be a roller coaster, but very exciting at the same time,’ says Robert Half’s Clive Davis.