When it’s time to call in a Fractional CFO
You’ve passed several milestones building your business, but you are quickly outgrowing your basic financial setup. It’s time to find expert help, and soon!
If you’re an early-stage founder - particularly if you’ve just secured venture or early-stage funding - you have bootstrapped and spent countless hours getting your business to where it is today. Your investors recognized that grit & determination within you and entrusted you with additional resources to continue building.
That new influx of funding however, comes with new obligations and even more weight loaded onto your shoulders - and is a forcing function to mature your financial operations, planning, and reporting (among other things).
The finance function of any business must grow and evolve to enable the core business to succeed. No matter what you think you may have solved for at whatever stage of growth your company is in, there will without question be areas you need to improve in.
I have had many conversations with local tech founders in the Austin area - and I pay close attention to the reactions I see from those founders when I start asking deeper questions about their company’s plans, and how they envision their finances & operations functioning at these later stages of their company. The more I prod, the more worried the expressions on their faces become.
It is important to understand that - you do not need to perfect your financial models, billing operations, sales tax remittance procedures, procure-to-pay processes, employment taxes, monthly close variance reporting, international transfer pricing recharges, expense management integration with your ERP, subsidiary consolidation, business unit acquisition accounting, annual tax provision (and 409A) procedures or any other of these (random) topics all at once. But you will grow into them. I promise.
A Fractional CFO can step into your business at whatever stage it is in and know (quickly) which topics to address that will add the most value - not just at that moment - but to help prepare you to grow towards more advanced stages of your company.
Well why don’t you just hire a full-time CFO and have that person stick around and solve all of this, full-time? Absolutely, go for it. But be prepared to share some slices of pie, with that person. Be also prepared to endure a months-long process of finding a person you know holds your ideas, values, and vision for the company just as dearly as you do - and for the long haul. Also, make sure you budget your cash, accordingly.
The alternative I hope you are taking away from this brief intro, is that a Fractional CFO can step into any business finance situation, quickly assess & develop plans to earn value for you and your company in a matter of weeks (not months), at a fraction of the cost of recruiting, hiring, and retaining a full-time CFO.
