Why Your Business Will Benefit from Hiring a Fractional CFO

Of all the Catch-22s that pop up in business, hiring a CFO can be one of the most frustrating.

You see, the easiest way to gain control of your finances and build a foundation for future profit is by getting a good CFO on board. But another C-suite position requires a whole lot of money, and you may not have those funds at your disposal. 

Some might say it’s an unfair vicious cycle. We say you just need to get creative. Because you can have your cake and eat it too… 

If you hire a fractional CFO instead. 

What’s the difference? Let’s take a look. 

Fractional CFOs vs. In-House CFOs

A fractional CFO is one who offers their skill set and experience to a company on a part-time or contract basis. They are typically very experienced and can equip companies with high-level insights to overcome specific challenges or achieve financial goals. 

The biggest advantage is the most obvious: a fractional CFO will cost much less than an in-house CFO and doesn’t require all the additional costs of a full-time employee. 

But dig a little deeper, and you may discover that you only really require a fractional CFO, anyway. 

Because here’s the thing…

While an in-house CFO spearheads the overall financial strategy of your organization, a fractional CFO can hone in on a specific element of your finances, from debt management to future planning. 

And quite frankly, that could be all you need. 

Here’s what you need to think about when hiring a fractional CFO. 

Is Subject Matter Expertise Important?

Some fractional CFOs specialize within specific industries. And this can be largely beneficial if you’re looking for someone who has experience with the particularities of the kind of business you’re running. 

Figure out how important it is to work with someone who has subject matter expertise, and use that information to spearhead your search.

What Problem am I Trying to Solve?

Are you up to your eyeballs trying to navigate an audit? Looking to manage investor relationships? Need help managing debt or planning annual budgets? Ready for a five-year plan? 

Spend some time thinking about exactly what financial services you’d like your fractional CFO to put on their to-do list, and make sure to refer to these services when you interview candidates. 

How Long Will I Require A Fractional CFO’s Services? 

You may just want to bring in a fractional CFO for one specific project. Or you might require their services on an ongoing contractual basis. By identifying your specific financial challenges, you’ll get a better understanding of how long you’ll be working with your CFO. 

How Often Will I Communicate With this Person?

Now, here’s something else to consider: because a fractional CFO is not an employee on salary, they’re likely to have other clients as well. And they won’t be around 24/7 for ad hoc requests. Remember, you’re hiring this person on an as-needed basis. 

However, you should definitely figure out their availability from the get-go. Will they be able to attend weekly meetings, or log into a Zoom call twice a week? Establish communication needs from the beginning, so you can make sure your fractional CFO can accommodate them. 

Hiring a fractional CFO can be a game-changer for businesses looking to level up their finances and see real growth. Are you ready to take the plunge? I <3 EBITDA has more than 22 years of experience helping businesses grow by setting up manageable processes that scale, as well as accurate reporting that helps business owners understand their finances and make the right decisions.  

Schedule a call today to find out how we can help! 

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Taking It Back to Basics

At the most basic level - when it comes to finances - all businesses are the same. What you make, minus what you spend, is your profit.

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