Startups often ask when to hire a CFO. Although every company is different, for many of our startup clients, an outsourced CFO is aoption if you don't plan on going public in the next 1-2 years.
It starts with small to medium-sized companies. Companies that bring in anywhere from $500,000 to $5 million in revenue. Smaller businesses can't afford to have somebody in-house handle their financial needs, unlike larger companies with in-house CFOs. It's vital to have operational guidance for your business in certain key factors, so we will sit down with our CFO clients and discuss company goals. Together we'll figure out your plans in a way you hadn't thought of before. It's not just financial advice either. It could be a question like “Where do you see yourself in the business in five years?”
We’ll look at the numbers and find out what's needed to get you to that place. You may want to sell the business in five years. How much do you want to make? How much do you want to pay yourself for all the numbers to make sense? We will look at many things and figure out how to get there.
What the CFO does is the first thing we need to understand.
An organization's Chief Financial Officer is responsible for all aspects of its finances. The CFO manages teams that are responsible for keeping accurate, timely books and meeting your tax obligations. Strategically, your CFO will monitor the company's health and provide guidance to achieve your financial
Keep track of your financial metrics and provide regular updates
KPIs should be reviewed and analyzed
Create a budget that works for you
Make financial forecasts
Develop growth plans for the future
Review of the board deck and creation of financial slides
Evaluate your financial hygiene regularly and recommend best practices
Make recommendations for improving your financial situation
Outsourced CFOs will perform the same strategic role for your company as in-house CFOs, but on a contract basis rather than as employees. Outsourced CFO services (also known as fractional CFOs or virtual CFOs) are typically billed hourly or by subscription.
Finance professionals are an essential part of guiding business decisions, especially at startups whose founders lack a financial background. Why might outsourcing be the right choice for your startup or small business?