When is the Right Time to
Hire a CFO or Controller?
How, When, and Why.
- Incorporate CFO talent into your business from day one.
- Start with the end in mind.
Are you struggling to gain financial visibility and strategic insight for your startup? Are you talking to investors who want information you can’t seem to put your finger on? Are you concerned about risk management and compliance? Congratulations! You’re probably in a growth stage of your business.
As your company grows, your financial needs become increasingly complex. You’ll need the strategic vision and leadership of a CFO to navigate new challenges and keep your company headed in the right direction.
You’re probably already feeling the pressure to bring on CFO-level talent. In the wake of the pandemic, most companies are laser-focused on the finance function, and current economic conditions have ramped up the demand for strategic leadership.
The problem is that you may not have the budget to bring on a C-level person full time. Even if you do, you may not be able to hire anyone else, and that means you’ll have to sacrifice operational and tactical efficiency.
So what to do? Hire a CFO? A controller? Someone who can straddle both roles? Keep treading water until you have a bigger budget? Scream for help?
Good news – you’re asking the right questions (except maybe that last one).
Is It Time to Bring On a CFO?
Short answer: yes. The brutal truth is that you should have incorporated CFO-level talent into your business plan from Day One. If you didn’t, though, it’s not too late. Do it now.
There is a reason that experienced entrepreneurs build fully functional teams right from the start. They consider their CFO to be the MVP, because they know that the best strategy for long-term growth is to start with the end in mind. These entrepreneurs want teams that are always ready for growth, and they understand that effective financial leadership is the key to future success.
Still not sure if it’s the right time? Here are some key indicators that you desperately need the strategic leadership of a CFO:
- You’re experiencing rapid growth. During growth stages, you need vision and strategic leadership to make sure you are moving in the right direction. You also need someone to handle financial forecasting, cash flow management, and the establishment of functional processes and systems.
- You’re experiencing growth challenges. Growth often brings challenges like lack of financial visibility, process overwhelm, the need for new technology, hiring new team members, and interactions with potential investors. The right finance leader can bring clarity to all of these areas.
- Your profitability is not where it needs to be. Perhaps your company is growing in terms of bringing in more clients, but your profitability isn’t keeping pace. To succeed in your next growth stage, you’ll need the financial insight both to identify the problem and understand how to fix it.
- You’re preparing for a merger or acquisition. Investors will want to see your financial statements and due diligence, and they will ask for detailed information about the financial structure of your company. A skilled financial leader will help you get those ducks in a row and close the deal.
If you are experiencing any of these friction points, then the time to hire a CFO is now. If you bring in CFO-level vision early, you won’t ever have to worry about growing pains. You’ll be ready for them.
How to Start with the End in Mind, Even on a Limited Budget
That all sounds good, right? But there’s still the question of budget. You don’t have infinite resources, so how are you going to build your team right now?
Option One: Add resources linearly one person at a time with an accountant, controller, and CFO. A lot of companies do this, but it’s not without pitfalls. There are advantages and drawbacks to every role and hiring one person at a time means you’ll miss out on certain skillsets. The reality is that no single person can do everything, which means you’ll always sacrifice something.
Option Two: Outsource any one or all of those roles to make sure you are creating value on your growth journey. Outsourcing gives you a competitive advantage by making sure you have the strategic leadership you need at every step of your growth journey. It also gives you access to a full range of skillsets up front without having to pay multiple full-time salaries.
When you outsource, you partner with a full financial team who can hit the ground running on day one and serve as an extension of your executive suite. If you are just starting out, you may not need the full-time attention of a CFO. But you do need someone who can set the strategic vision, and you may also need additional resources to help you handle tactical and process needs. The beauty of outsourcing is that you get the resources you need, and you don’t have to sacrifice one skillset in order to add another.
At CFO Alliance, we deliver a full-stack finance team solution so you won’t have to make the hard decision about who to hire or which positions to outsource. We give you what you need, when you need it, and we make sure your processes work for you, not against you.
Whether you are launching a new venture, scaling your operations, or considering a merger, partnering with CFO Alliance gives you the financial strengths you need to move forward with confidence.
Contact us today to learn how we can deliver the financial expertise you need to accelerate your growth!
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