What is Beneficial for startups: In-house CFO or Outsourced CFO ?

OUTSOURCED CFO SERVICES provides you a financial expert (CFO) for risk management, compliance, capital structure, economic strategies and performance evaluations and offers financial expertise that aids growth.

One of the biggest challenges that SMEs face is about hiring an expert help. As business owners, we are told to do both, to manage costs and to get help rather than be an expert in all the things.

One area of expertise is often overlooked by SMEs is the area of strategic financial management. As small business grows, their needs tend to outgrow what their book-keeper or accountant can offer. And their success and on growing growth is likely to be constrained by not having access to the right level of financial advice.

What is an outsourced CFO?

The problem is the company will only realize when the information needed to support the decision making in the business is not available – Financial guidance/advice. A CFO- CHIEF FINANCIAL OFFICER is a professional found in the large corporate sitting at the top of the finance and administration hierarchy that reports directly to the CEO.

Need assistance in making your business happen? OUTSOURCED CFO aims to help your company navigate its financial function. As new and young companies cannot afford a qualified CFO to navigate this facet their business, hence outsource CFO seems to be best option.

What is the cost of an outsourced CFO?

OUTSOURCED CFO works closely with you to customize your financial solutions for the business. The solutions provided are cost effective and helps increase your business profitability. Depending on your company’s requirements, and the services you render the cost varies. You can hire an outsourcing service package or can have it customized as per your company’s needs – whichever ways; they are the most affordable options than hiring an in-house CFO.

Which is a good option, in-house CFO or an outsourced CFO?

SMEs can get high level of financial guidance without cutting a big pay check. If you are like most of the small business owners, your CFO is most probably either non-existent or underutilized.

OUTSOURCE CFO is a good investment for your business- Instead of hiring a full time in-house CFO; you can choose to outsource your needs by OUTSOURCING CFO Assignments. An outsourcing arrangement helps you to:

  • Save money on hiring costs
  • Implements professional inputs
  • Get an access to professional insights
  • Create hassle free operations

What are the benefits of an outsourced CFO?

When you OUTSOURCED CFO services, you can choose to have the CFO resource work as per your needs. An outsourced CFO can contribute to the growth of the company by:

  • Establishing a seamless financial process that manages the profits better
  • Proactively streamlining and drive internal business cash flow by managing working capital and improving profitability
  • Streamline business accounting and ensure that bookkeeping is done in the manner if it is required for year-end financials and tax time.
  • Develop, implement and process that ensures consistently accurate accounting.
  • Develop forecasting tools to help with planning and analysis for the business.
  • Contributing to the activities related to the revenue generation such as extending channelized support to the marketing efforts, raising capital, coordination with decision making members etc.
  • Implementing and improving system of communication between the key elements concerning the business like advisory boards, bankers, investors, etc.

What to look for when selecting an outsourced CFO?

Hiring an OUTSOURCED CFO is an important yet tough decision when it comes to your start-up financial management, while keeping the cost structure flexible. However, it matter a lot who you hire.

It would be easier to find the right fit, if you are clear about your company’s requirements. The important thing is to find a right OUTSOURCED CFO that can meet your current needs and grow with the company. Begin with these questions:

  • What specific experience do you have working with start-up businesses? Start-up demands having a unique skill-set therefore, they’ll need who is expert at financial projections, accounting credentials and managing budgets. Also, the start-up CFO needs to have good negotiations and strategic planning skills and extensive contacts with potential funding sources.
  • What is your domain expertise? Different professional services may specialize in couple of specific areas. Ensure that the one you consider can offer you full service support.
  • How do you work with the clients? You are trying to understand if this person has the capability and desire to partner with you in the development of your company’s financial structure. This encompasses an ability to wear multiple hats and flexibility to adapt to quickly changing circumstances.

Your relationship with your OUTSOURCED CFO should be like trusting professional that helps you in all the aspects of the business.

How will an OUTSOURCED CFO contribute before a company goes for his first round of funding?

SMALL-MEDIUM BUSINESSES that hire an outsourced CFO get the expertise Chief Financial Officer without having to pay for the cost that typically commands. Before the company goes for his first round of funding, an outsourced CFO can help with:

  • Well-documented business plan covering all important levels of business with appropriate assumptions in line with industry structure and economy.
  • A well-defined financial plan plays a crucial role in evaluating early stage venture; hence the financial documents like P & L Accounts, Balance-sheet and Cash flow are the most important paper work of this entire exercise.