What does a fractional CFO do? Fractional CFOs (Chief Financial Officers) most commonly partner with companies to help overcome financial challenges, achieve growth, optimize strategy, implement systems, raise capital, or navigate an audit or transaction.
Organizations may hire a fractional CFO, an expert CFO who works part-time, on a retainer or a contract basis. This provides the experience and expertise of a high-end CFO without the in-house costs—salary, benefits, and bonuses—associated with a full-time CFO.
What is a fractional CFO? Generally, a fractional CFO doesn’t maintain or set general financial strategy; rather, his or her work is project-based and tailored to the company’s specific problems or objectives. Although, their expertise can be used to help develop financial strategies to take a business in the direction they want to go.
What Does A Fractional CFO Do?
A fractional CFO can assist businesses in overcoming financial barriers, achieving success, optimising strategies, implementing systems, raising capital, or handling an audit or transaction in a way that is economical, timely, and of the highest quality.
A Fractional CFO Can Help Overcome Specific Challenges
Fractional CFOs are often hired by companies when the organization’s existing personnel do not have the skills or manpower to address their specific financial issues, such as:
-Low gross margins
-Cash flow issues
-Navigating an audit
-Reviewing existing financial systems and implementing new ones
-Lack of clarity on how to achieve their financial goals
Provide Financial Forecasting And Insights
Having a fractional CFO can help optimize or implement more forward-looking financial visibility. While accountants, bookkeepers, and controllers keep past and present finances organized and well-documented, a CFO looks to the future.
A fractional CFO can help you determine how to get your company from where you are now to where you want to be. A financial forecast from a fractional CFO can serve as a financial blueprint for achieving rapid, efficient, and sustainable growth for many businesses.
A company can better forecast its direction and cash position or demands by taking a short-term (up to 90 days), mid-term (remainder of the year), and long-term (up to five years) perspective. Fractional CFOs can help manage through hard times, assist in deciding when and how to obtain loans or investments, anticipate future owner compensation, and help plan and prioritize future business choices like staffing, production, and geographic expansion.
Fractional CFOs can provide the following benefits to companies:
-Clarity on their financial health
-Develop financial forecasting
-Analyze the financial feasibility of future products, services or customer segments
-Prepare budgets based on forecasting models
Helping Manage Growth Is Important
Fractional CFOs can assist companies with growth, guaranteeing that they stay profitable as they grow more sophisticated. This process involves creating tools, procedures, and vendor relations that help deliver value to an increasingly diverse and numerous consumer base. Many organizations encounter declines in margins and problems as they grow in size. To cross the chasm, most businesses must reinvent their tools, procedures, and vendor relationships.
Once a business passes the initial startup phase, the philosophy of “What got you here won’t get you where you want to go” is ever-present. Businesses expand their product offerings, open up new markets, establish new locations, accept new currencies, and handle growing regulatory demands. These upgrades all require more sophisticated thinking, tools, and techniques.
Bootstrap startups often begin with a part-time bookkeeper and simple systems, but later discover that they are unable to handle additional business growth and complexity. As a company grows, systems, resources, processes, and strategies must become more sophisticated. Companies can benefit from using fractional CFOs to:
-Implement financial systems to support future sustainable growth
-Explore root causes of cost overruns, cash flow issues, and revenue leaks
-Successfully help hire new employees for financial roles
-Improve the clarity and analytical capabilities into actionable and understandable insights
Helping People Achieve Their Goals
A fractional CFO can also help a company achieve a specific goal, such as raising money or preparing for a sale, merger, or acquisition. Fractional CFOs have raised hundreds of millions of dollars in debt and equity funding for businesses, as well as overseen numerous mergers and acquisitions.
Fractional CFO consulting is useful in these situations:
-Improving your bookkeeping systems and financial systems
-Getting your books in order and ready for audits
-Guiding leadership in financial clarity and decision-making
-Analyzing contracts and agreements
-Overseeing due diligence and policies
-Producing financial forecasting and reporting
Talk To A Fractional CFO Today
Learn how Intrepidium’s Fractional CFO services can help your business achieve its financial goals, bring clarity to your financial world, and implement the systems and processes to transform your business. Call us today at 778-800-7976.