Picture this: your morning kicks off with a sprint through an inbox overflowing with messages from potential clients, collaborators and suppliers.
As you wrestle with your inbox, your mind is already racing ahead to the day's lineup of meetings. Investor calls, team catch-ups and a strategy session, each demanding your focus, creativity and rapid decision-making.
And just when you think you might catch a breath, you remember about finances. Budgets, forecasts and financial strategies – they're crucial, but they're confusing and drain your energy.
You can’t be a chief everything officer – you'll have to hire professionals to help you with your small business financial management. Luckily, as new business models emerge, outsourced CFO solutions are also evolving, and many companies are choosing virtual CFO services instead of traditional ones.
In this article, we'll explain everything you need to know about outsourcing CFO services and choosing the right one for your startup.
An outsourced CFO (Chief Financial Officer) is a person who provides financial expertise and guidance to your business without being a full-time employee.
They can offer different outsourced services, such as financial planning and analysis, budgeting and optimizing cash flow management.
These financial experts can work as:
Whether or not you need an outsourced CFO largely depends on the size of your company.
The list of outsourced financial services CFOs can provide is long, and here are the most common ones:
Trying to manage a business without adequate financial information will be like trying to put puzzle pieces together without looking at them.
You'll need someone to either take that blindfold off or guide you all the way through.
An outsourced CFO can bring numerous benefits to your startup, such as:
Before you exhaust your financial resources, which happens in almost one-half of startups that fail, inform yourself about the cost of outsourced CFO services and consider it an investment rather than an expense.
The typical annual base pay for a full-time CFO in 2023 is approximately $147,000, as per 9,380 salary profiles, excluding bonuses and equity. Yet, alternative sources cite a higher average base salary of $250,000 to $400,000 for a seasoned specialist.
When creating an agreement for fractional CFO services, specify the duration or extent of collaboration expected from the professional.
The typical hourly rates for these services range from $250 to $400. The monthly expenses for engaging a fractional CFO could vary from $8,000 to $16,000, determined by the number of hours or days you need their help.
Contrast this with the annual salary range of $250,000 to $400,000, plus bonuses and equity, required for a full-time CFO. Therefore, you'll understand why companies increasingly favor a fractional CFO model.
If you're a small business owner or a startup founder, you might not have enough financial resources to hire an in-house CFO to cover all your financial matters.
Therefore, we present you with Fuelfinance – your cloud-based CFO!
Fuelfinance is a multipurpose financial management solution with two main functions:
The benefits of this startup financial management model include:
O0 Design, a full-stack design studio, collaborated with Fuelfinance to achieve the smooth management of business finances. Today, they exhibit an impressive 2x Year-over-Year growth due to their reliance on Fuelfinance's robust, data-driven insights for all decision-making processes.
Petcube, a widely recognized company offering smart pet devices, joined forces with Fuelfinance, resulting in five times more efficient and ten times more cost-effective solutions than the ones they've been using before. This not only boosted profitability but also built confidence in the future prospects of the business.
Hampton is an exclusive, by-invitation CEO membership community boasting an average company revenue of $23 million per member. Fuelfinance showcased its adaptability to the changing financial landscape of Hampton's expanding operations, tailoring its reporting to accommodate evolving needs and enhance agility. We can do the same for you by customizing financial modeling for your company.
Opting for outsourced CFO services may be the best financial decision for your startup or company, which can pay off in many ways.
For our clients like O0 Design, this meant achieving 2x YoY growth while reducing the time spent on financial management by 50%. For other clients like Hampton, it meant significantly increasing revenue per customer while simplifying their overall reporting system.
With dozens of companies that improved their finances since switching to Fuelfinance, we can confidently say that combining a comprehensive financial app and expert consultations is a way to success.
If you're a small business owner or a startup founder striving for effective financial management, book a free demo and let us help you skyrocket your financial success!
An outsourced CFO provides their financial expertise to help you with planning, financial forecasting, budgeting and making strategic decisions. The exact tasks may vary depending on your business model, company size and whether you have an in-house finance team or not.
It may vary based on their expertise, but the average hourly rate for CFO services ranges from $250 to $400. Monthly expenses may vary on how much help you need, but they're usually anywhere from $8,000 to $16,000 for a fractional CFO.
Hiring an outsourced CFO is a cost-effective way to gain access to the high-level financial expertise of a person who can help you manage your finances and reach your financial goals.
The ideal time to opt for an outsourced CFO solution is when you're a mid-size company worth anywhere from 5 million to 20 million. However, there's no need to hire a full-time chief financial officer unless you're a large company worth more than 20 or even 50 million, depending on the industry and complexity of financial procedures.
