Hiring a Virtual CFO

For a long time, a small business having a Chief Financial officer (CFO) was essentially impossible in terms of affordability and practicality.

Of course, expert financial guidance from an experienced professional would be amazing, but having to pay someone full-time in the role never really stacks up for small business owners.

However, as the way we work has changed to a more remote, online basis, so has how we can engage a CFO. The word virtual has been placed into the title, meaning you can hire a Virtual CFO in your business on a part-time basis. The Virtual CFO you hire will also work with you remotely or online.

This is excellent news for small business owners because it allows you to leverage high-value financial guidance in your business for a fraction of the cost of a traditional hire.

Throughout this article, I'm going to detail three key benefits of hiring a virtual CFO, so you can truly understand the impact they can have on your business.

Virtual CFOs are highly experienced business professionals

At a glance, this might seem a little too simplistic. But what I'm referring to is that by hiring a virtual CFO, you're gaining the insights, experience and knowledge of someone who understands the fundamentals of financial success for a small business.

In a recent article, I wrote about the critical understanding that as a business owner, it's not your job to know and do everything. It's your job to ensure everything is done as efficiently as possible.

Unless you have formal education in accounting or finance, you will likely have plenty to learn about your business's financial systems.

Given that the entire purpose of a business is to contribute value profitably, having someone that understands this deeply guiding your key decisions is highly valuable.

The right virtual CFO will give you the best chance of building and running a profitable business and steer you away from the mistakes and common errors that many business people make that hold them back.

Virtual CFOs provide objective feedback

As business owners, it's too easy to let our preferences, biases and opinions cloud our judgement. This is simply human nature, and it's to be expected. This is okay too. Our ideas and inspiration are what make our business what it is today.

Unfortunately, the reality is that we won't always be correct. And sometimes, we'll only focus on what we want to focus on to avoid painful situations. This is where having a Virtual CFO you can turn to is so valuable.

Virtual CFOs are external to your business, and their focus is the success of your business. Unhindered by your worldviews, they can provide solid advice from a place of practicality, reason and proven experience. Having someone to tell you how it is, especially regarding your business's financial functions, is a resource that can't be ignored if you're serious about the growth of your business.

It's a harsh reality, but often the biggest bottleneck in our business is ourselves. Outside counsel from a virtual CFO is a great way to keep everything moving forwards.

Virtual CFOs provide clear structure and guidance on your business goals

Every business owner is in business for a different reason. The role of any good virtual CFO is to understand your own 'why' and build your financial strategy around that.

For example, virtual CFOs are invaluable resources if you're planning to build up the value of your business and exit the business. Alternatively, your business might be seeing exponential growth, and you don't know how to sustain it or allocate the revenue you're generating meaningfully. Perhaps your business is underperforming, and you need to look into the business further to turn things around.

Whatever your goal is in business, a virtual CFO will outline a clear path to achieving your required outcome and hold you accountable for the actions and steps that will get you there.

We all know how quickly the critical tasks that will grow your business can get put on the back-burner as urgent client requirements and internal staffing issues arise.

Nonetheless, the right virtual CFO will hold you accountable for what needs to be done in your business or at least provide guidance around how these specific tasks can be outsourced.

Should you consider a virtual CFO in your small business?

Before we wrap this up, I'll put forward a few key signs that might help you determine if it's the right time to hire a virtual CFO.

You're seeing exponential growth in your business, but you aren't sure how to ensure the growth is long-term and sustainable.

The key numbers in your business are getting away from you. You might be experiencing cash-flow issues, or you don't understand how healthy your business really is.

You plan on selling the business within x amount of years but don't know how to build the business into something that's genuinely high value for investors.

These are some but not all of the key reasons you should consider hiring a virtual CFO. If you are interested, it might be best to catch up with one in a free online meeting.

The team here at Accolution are highly trained experts in small business and act as virtual CFOs to numerous growing companies in Australia and overseas.

Click here, and we'll organise the best time for an online meeting.