The Advantages of Hiring a Fractional CFO

Headshot image of author James Wheeler
By James Wheeler
February 22, 2023

The strength of a company is directly tied to the financial decisions made alongside operations, marketing, and growth. Deciding when to invest in infrastructure or how to finance a big purchase is a strategic position that could ultimately impact the trajectory of the company as it grows.

The Impact of Financial Decisions on Organizational Growth

Let’s say that a middle-market company is experiencing rapid growth in its primary market. To meet the demand, the company decides to hire additional staff. With a bigger team, day-to-day workflows naturally begin to change. Processes for quality assurance that previously involved a single touchpoint now have three or four hands completing a portion of the process causing the growing company to lose visibility.

The company decides to make a big purchase on a new operations management software program that promises to integrate operations, sales, quality assurance, and other resources into a single platform to provide end-to-end visibility over the entire business process.

This decision could be a powerful way to support sustainable growth or an incredible drain on the company’s resources. The outcome depends on many different, complex factors like:

  • The cost of the software and development needs to make the program fit the company’s needs.
  • Ongoing cost of ownership like increased cybersecurity needs or peripheral technologies like scanners to support data inputs.
  • Labor requirements to keep data up to date and accurate.
  • Level of automation available to improve efficiency.
  • Employee training needs and ease of adoption for new technology.

Strong financial talent can help guide a company through the process of making everyday operational decisions that potentially impact long-term growth. The only question is–when is the right time to hire financial talent?

The Role of a Chief Financial Officer

Not every company needs a full executive team. Many small businesses start out with a single founder wearing many different hats. As the business grows, so does the leadership team. However, deciding when to add a Chief Financial Officer (CFO) is a unique, strategic choice for each business.

The CFO typically oversees the financial side of planning and operations across the organization. This includes:

  • Financial Planning & Analysis
  • Financial Reporting & Compliance
  • Risk Management
  • Capital Allocation
  • Financial Operations Management
  • Investor Relations
  • Strategic Planning & Business Development

It’s a big job that comes with a big salary. While not every company needs the commitment of a CFO position, they can all certainly benefit from expert financial support.

Fractional CFO services offer top-tier executive-level financial talent with a scalable commitment. For companies that might only need a few hours per month, fractional CFO services provide an alternative to relying on less-qualified financial talent when making strategic business decisions.

Benefits of Hiring a Fractional CFO

Fractional CFO services are growing in popularity as an ideal solution to an accessibility problem faced by startups and growth-stage businesses. These services offer experienced, executive-level financial talent with a flexible commitment.

Some companies use fractional CFO services to access expert advice for a few hours per month. Other companies use fractional services to bridge the gap between full-time hires. The real benefit of fractional CFO services is the flexibility to use what your business needs.

Get Support to Make Better Growth Decisions

Hiring a fractional CFO can be a good way to put your company on a solid path to financial sustainability. When you have the right talent guiding decisions with the right perspective, the entire company can make better decisions.

There are two ways to get great talent involved in the conversation. The first is to recruit and hire heavy hitters to build a winning team. This can be expensive and time-consuming–and for growing companies, not always feasible. The alternative is to outsource. Fractional CFO services provide an option to access quality financial talent with a flexible commitment.

Access Skilled Financial Talent at a Significant Cost Savings

When you compare the costs of fractional CFO services compared to the cost of finding, recruiting, and maintaining an executive-level position, the savings can be significant. These savings can be compounded by better control over your company finances. A fractional CFO can provide financial planning and analysis that guides your business strategy from a cost-efficiency perspective.

Strengthen Funding Prospects

A fractional CFO comes with considerable experience. They have worked with companies in all stages of growth, handling important tasks like FP&A or venture capital fundraising. One key benefit of working with a fractional CFO is that it can provide a level of confidence to potential investors or lenders that strengthens the company's funding prospects.

Hiring a Fractional CFO can Transform Your Growth

Sustainable growth takes strategy. It’s the type of thing that takes continuous monitoring and adjustment. Ultimately the success of any business depends on how well they adapt to changing conditions and continue to grow. A fractional CFO can be a great way to access quality financial talent to guide business strategy.

Headshot image of author James Wheeler

James Wheeler

James Wheeler has 15 years executive financial leadership experience in service and technology companies. He was a San Diego Business Journal CFO of the Year finalist in 2019. James was the recipient of multiple graduate fellowships at the University of California, San Diego, where he earned a BA in economics and an MBA, before complementing that with executive education at MIT Sloan. He has held several nonprofit and for-profit directorships and committee positions over the past 10 years.


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