When should an SMB hire a CFO?


Hiring a CFO with their financial expertise could be one of the best decisions you ever make. Post-Covid, many businesses are assessing their business structures and staffing arrangements. Perhaps yours is one of those, and you are tossing up whether to hire a CFO.

Hiring a CFO depends on your business, its development and the industry you are working in. A CFO’s role is to manage the finances of a business, which encompasses many different areas such as financial reporting, record-keeping, financial planning and financial risk management and strategy.

Here are 5 signs it's time to hire a CFO:

1. Financial and cashflow problems
Financial stresses and cashflow problems can focus your attention on that part of the business to the exclusion of all else. They can limit your and others’ effectiveness in the workplace, and impact on home life and health. Rather than carry the burden yourself, you could hire a virtual CFO to apply their expertise to your finances. It sounds counter-intuitive to spend money when you have financial issues but it could be the best thing you’ve ever spend money on, freeing you up to focus on other areas of the business.

Related: Why a Virtual CFO is a great choice if your are a small to medium business?

2. Rapid growth
Conversely, when a business is growing quickly is also another time when you should consider hiring a CFO. Business owners can feel out of their depth, not knowing what area of the business to focus their attention on. Even if you are a whiz at accounting, it still makes sense to hire someone with specific skills, experience and expertise in this area as it always pays to have two sets of eyes rather than just one. A CFO will have an unbiased and pragmatic approach to your finances, giving you time and clarity to work towards your goals.

3. Support for the executive team
In times of stress and even when things are going well, executive teams can become comfortable managing day-to-day responsibilities rather than having the energy to think about big picture planning. Even if some have an inkling that the business could be doing better, individuals may be lacking a structure where their ideas can be brought to the fore.

How can a CFO help? The role of a CFO should be strategic and aligned with supporting the executive team to achieve significant profit growth.

A simple event such as a monthly board meeting, giving structure and formality to your leadership team can be set up by your CFO.  They can provide key commentary and insights into your business’ performance and strategy, providing powerful tools that promotes big picture thinking.

4. Looking for investors
If you are at a stage where you are looking for investors then financial management and the presentation of your finances becomes crucial. Investors are going to expect your business’ finances to be extremely transparent and tightly controlled. A CFO will ensure that your finances are in order, presented in a way that will attract investors and will add credibility to your business.

5. Current economic climate
As a result of the current economic environment, there are many varied challenges so quick, decisive and educated decisions around the financial and strategic management of your business during these uncertain times is imperative. A CFO can add this depth of knowledge at the executive level of your business at a speed in which the market requires it.

The benefits of hiring a part-time CFO

A CFO is a senior position and therefore expensive. There are ways to mitigate this cost, though, by hiring a CFO on a part-time basis on a flexible working arrangement. That way, you can benefit from their knowledge, skills and expert input when you need it most.

  • You get the best of both worlds – the expertise of a CFO without the permanent salary costs.
  • By offering flexible working arrangements, you will be in line to pick up the best talent.
  • Though part-time, a CFO can still complete a thorough review of people, systems and finances and implement changes that can benefit the business in the short and long term.
  • A part-time CFO would have the experience to help you navigate various types of transactions so that the outcome is to your benefit. Those specific transactions may include business acquisitions and mergers, capital raising, valuations, due diligence, ESOP arrangements and also the implementation of specific strategic CFO initiatives to support your business growth.

Have you noticed our #FridayExpertTips... here's one that relates to #CorporateAdvisory

"As a small business you might be missing the strategic advantage that comes with having a CFO. An experienced part-time Virtual CFO could be solution that helps accelerate your financial growth and business success."

Tap into a team of highly skilled Corporate Advisors and Virtual CFOs

Azure Group delivers strategies that empower our clients success and have witnessed our clients grow year on year by an average 23%  and know our hands on approach contributes to this success.

Our team consists of highly talented and experienced senior finance executives who each have a substantial commercial background and have worked with various sized businesses across a wide range of industries and in a multitude of countries. Speak to us.

Related: What is the difference between a Virtual CFO and a Financial Controller and why to engage one?

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About Author

Azure Group
Azure Group

Azure Group is the leading Chartered Accounting, Business Advisory and Strategic Advisory firm supporting the growth & success of fast growing entrepreneurial businesses.

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