When Should a Startup Hire a CFO?
Chief financial officers (CFOs) play an integral role in the streamlining of business finances. They’re an important facet of keeping control of your cashflow and monitoring what money comes in and when and where it’s paid out to. As a new business, you can benefit from having one on your team, but exactly when should a startup hire a CFO?
What is a CFO?
Before you can think about hiring a CFO, it’s important to first understand exactly what they do. The role of a CFO can vary depending on the business, but typical duties include:
Controllership responsibilities (meeting with board members to discuss historical financial information and how it can underpin future growth and investments)
Treasury responsibilities (looking at current business capital, determining if there are any issues, and whether future plans can be made based on current circumstances)
Financial forecasting and growth (using data from controllership and treasury reports and identifying positive areas and areas that need more work)
Other duties may be added or taken away depending on the unique financial needs of each business, but generally speaking, a CFO is the head of a financial department and plays an active role in liaising with the decision-makers to ensure the business grows and moves forwards.
Learn more about the role of a CFO and how hiring a CFO could help your startup excel in growth and reach its fullest potential.
When should a startup hire a CFO?
You might think that a startup has no need for a CFO because it’s not an established business and finances tend to fluctuate a lot in the infant years, making it difficult to financially forecast growth or make decisions on where money should be spent. Whilst this is the case for most businesses, the sooner you get on top of your finances, the better.
To answer the question of when to hire a CFO, as soon as possible is ideal. They can monitor your cash flow from the beginning and identify issues before they turn into something bigger. Having a CFO on board early on will stand you in good stead for the future.
How to hire a CFO
There are several ways you can hire a CFO. You can bring one in house through your own private hiring process on either a full time or part time basis, or you can outsource one. Due to the nature of startups, it could be more beneficial to outsource a CFO as and when you need one because it’s unlikely you’ll have enough work to warrant a full time position.
CFOs also incur high salaries typically out of range for startups to be paying, so outsourcing can be useful from this aspect, too.
CFO services at Accountancy Cloud
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To learn more about our CFO services and how they can help your business, contact us today.
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