Why You Should Hire an Outsourced CFO

January 08, 2019 By Dave Chase

The CFO is a key influencer on a business’ success. From startup to enterprise, every business benefits from a strategic CFO. However, contrary to tradition and popular belief, not every business needs a full time CFO. Despite different business needs, a good CFO can help make the difference between a successful year and an unsuccessful one. Here’s why you should consider an outsourced CFO for your business.

What is an Outsourced CFO?

An outsourced CFO is financial expert who steps into the role of CFO at a business in a variety of capacities. Outsourced CFOs can be hired in the interim, acting as Full Time CFO until the business is able to hire one. CFOs can also be outsourced on a project, part time, or full time basis, hired to perform one specific task, or to fully command the finance and accounting functions of the business. They can consult, create financial strategies, and affect positive change just as well as a full time CFO, but on a pay for play basis.

In short, an outsourced CFO is you business’ financial expert — on your terms. Outsourced CFOs usually work on an hourly basis, meaning that you only pay for what you use. Fixed fees are also a great option for businesses needing assistance with specific projects. An outsourced CFO adapts and changes depending on the needs of the client.

Outsourced CFO

Why Hire an Outsourced CFO?

Hiring a CFO is a monstrous task. The implications of choosing the right candidate that fits within budget constraints and company culture can mean lots of time and energy spent reviewing resumes and interviewing. Choosing an outsourced CFO may be right for your business if:

You want to hire an expert, but can’t afford the salary. Outsourced CFOs are experts with proven success at many different companies. You’ll get access to their tried-and-true ideas, without having to pay salary or benefits. Just pay for the time you need, when you need it.

You only need a few hours a month. Outsourced CFOs can work on a part time or project basis, which means no more paying for unused hours. Even better, outsourced CFOs are experts and have worked as CFO on several different companies, so they’ll likely be able to get the job done in even less time than someone with less experience. 

You’re looking to hire a full time CFO, but need help in the meantime. Outsourced CFOs can pinch hit for a short period of time, keeping the financials up to date, assisting with planning and modeling, and managing the financial function so you’re free to focus on choosing the right candidate. Even better, they’ll help make the transition even smoother once you’ve found the right person for the job.

You’re worried about choosing the wrong candidate. A good hire means more than finding the right expertise to get the job done. Often times cultural fit and personality can make or break an employee relationship, especially at the executive level. Outsourced CFOs work differently than internal hires and mitigate the risk of hiring the wrong person. Take an outsourced CFO for a test drive on a project or two before bringing them in full time. If it doesn’t work out, no harm, no foul.

Outsourced CFO

Outsourced CFO for Every Stage of Business

Because of the flexible nature of outsourced CFOs, businesses of all sizes can benefit from their services.

Startup

Startups often don’t need a full time CFO, so paying a $300,000/year+ plus benefits is unnecessary. Budget constraints can also limit companies from hiring an experienced CFO, so many startups hire connections that may not actually have the experience they need. An outsourced CFO is ideal for startups to stay under budget and get the strategy and experience they need to grow.

Growth Stage

As a company grows, its needs can change dramatically. Accurate financial modeling and planning is paramount to the successful growth. Because needs may differ from month to month, an outsourced CFO is a good option, taking on projects and tasks as needed. It’s a win-win — the company saves money on unused hours and gets an experienced professional to get the job done.

Enterprise

Large businesses usually have more full time needs than smaller businesses. In this dynamic, outsourced CFOs can plug into organizations as consultants on a short term basis, or can even fill CFO needs on a fixed term basis. For example, if a company loses their CFO, their need for strategic analysis and planning doesn’t go away during the hiring process. Yet, hiring a good CFO can take time. Outsourced CFOs can step in during the interim and help make the transition easier on both the company and the new CFO.

As your business looks to hire a CFO, consider hiring an Outsourced CFO, instead of a full time CFO. You’ll get best-of-breed financial expertise and see the same results for a fraction of the cost of a full time CFO.

Not sure what your business needs? Advanced CFO offers highly skilled CFOs ready to tackle your business’ unique challenges. Contact us for a free consultation.

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