6 Reasons to Hire a Virtual CFO Today

Founders of startups and high growth businesses often struggle to find time to do everything. While focusing on growth, you may let tasks like cash flow management, budgeting, and forecasting fall by the wayside. Fortunately, a virtual CFO offers a superb solution for businesses in need of financial leadership. Below are six reasons a startup or high growth small business should hire a virtual CFO:

1) Hiring a virtual CFO is more affordable than hiring a full-time CFO.

The cost of hiring a full-time CFO can average close to $200,000 per year, making the expense out of reach for many startups and small businesses. Hiring a virtual CFO costs a fraction of this. The cost savings is significant because companies pay for financial services on an as-needed basis instead of paying a full-time salary.

2) Your forecasting and budgeting will improve.

According to a 2016 financial priority survey, cash forecasting is a top priority for business owners. Without the expertise of an experienced financial professional, a company's key performance indicators can be negatively affected. Here are some ways that a virtual CFO can lead to more timely and accurate forecasting:

  • Outline and track critical financial risks
  • Create a budgeting schedule and adhere to it
  • Oversee investment funding and returns

3) A virtual CFO will help you prioritize your financial goals.

Determining how to allocate resources is a task that is best handled by an experienced CFO. A virtual CFO has the skills to evaluate your goals and how best to reach them. Here are a few examples of tasks a virtual CFO helps with:

  • Evaluation of system upgrades to allow expansion into international markets
  • Selection of a cost-effective telephone system and CRM software
  • Approval of investment in new product lines

4) Your company will benefit from professional financial leadership when you hire a virtual CFO.

A virtual CFO offers objective leadership and ability to make tough decisions that a business owner or full-time employee might have difficulty making. For instance, a virtual CFO may advocate the elimination of jobs that are not yielding sufficient returns.

5) You will enjoy a healthier cash flow.

A healthy cash flow is critical for paving the way for business expansion and acquisition of new product lines. A virtual CFO will employ strategies to help a growing business enjoy improved cash flow on a daily basis. Below are a few examples of specific strategies that virtual CFOs often implement for improved cash flow:

  • Implement electronic invoicing?
  • Oversee collections efforts, especially before the holidays to ensure receipt of payments
  • Determine when it is a good idea to use the company credit card

6) A virtual CFO will work alongside key members of your company.

Virtual CFOs work side by side with business owners to help them determine how they should focus their financial resources. A virtual CFO can also work alongside sales directors, COOs, and HR directors, therefore making your life easier. They can help manage costs by balancing expenses with sales goals.

Choosing a Qualified Virtual CFO for Your Growing Business

Seeking the services of a virtual CFO is an effective way to prepare your startup or growing business for future prosperity. Failure to seek the guidance of a trained financial professional can result in impulsive financial decisions that hinder future growth. A trusted virtual CFO will conduct a thorough analysis of risks and rewards to ensure that your business is well-positioned for success. Most importantly, a virtual CFO provides welcome relief and financial direction for overburdened business owners.