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A lot of people ask me, "Hey Chris, our company isn't developed enough that I need a full-time CFO, but we still can't manage our finances well." What possible remedy is there for this? Bringing on a full-time CFO? No, it is very expensive, making it unsuitable for small businesses. Hiring a contract agency to redesign the structure and implement a new strategy for a period of time similar to three to six months? To this, I would say, "One can try, but the chances are 50/50." Because someone without financial expertise cannot maintain those strategies after the agency's contract expires, and eventually the business will collapse once more. Fractional CFOs?? I have heard about this, but not sure what they do and how they can be helpful for the business. Indeed!!!!!! Yes, I will outline the services to be expected as well as the (quantifiable) advantages of selecting one here. In many small businesses, fractional CFOs—who carry out the tasks required by the organization but are not full-time in-house CFOs—can be beneficial. How does it work??? A fractional CFO is, as the name implies, a person who, under contract, provides financial expertise to a start-up. Part-time or fractional CFOs typically assist start-ups temporarily but have a wealth of prior CFO-level experience. Fractional CFOs are typically involved in multiple start-ups. What does a fractional CFO do for growing businesses? 1. Finance - This is the CFO's bread-and-butter role. The financial procedures of start-ups grow too complicated for the founders to handle alone, even with the assistance of an accountant. They require an individual who can see beyond the details of accounting and financial reporting to the broader picture. 2. Optimize strategy - Since cash is the lifeblood of businesses, CFOs play a crucial role in developing and refining strategies as the financial gatekeepers. A fractional CFO can provide insight into the financial aspects of strategy by providing an analysis grounded in data. Put differently, your fractional CFO can evaluate your plan and let you know if it makes sense financially. And what steps can be taken to optimize it if not? 3. Implement systems - Start-ups must implement better systems as they grow in order to adapt to their changing needs. This calls for the oversight and direction of a person with experience implementing several systems in various contexts. Someone who has seen it all can anticipate potential problems and fix them before they arise. With a fractional CFO on staff, the founders can assign all audit-related duties to a professional with relevant experience. There are many more advantages, and to know more you can book an appointment with us, we provide all accounting and finance, tax tax-related solutions which will help you to utilize the resources more efficiently. Let me know in the comment sections if you have questions similar to these. #finance #money #business #cfoservices #fractionalcfo #financialadvisor #nebraska

The Changing Landscape of CFO Roles: Insights from a Conversation with a Startup CFO Today, I had a fascinating conversation with a startup CFO. During our discussion, he mentioned that at least one-third of his colleagues have transitioned to fractional CFO roles over the past year. This trend piqued my interest, and we delved deeper into the reasons behind it. We identified several key factors driving this shift. 1. Higher Interest Rates and Capital Flow The rise in interest rates has significantly impacted the flow of capital, leading to a decrease in demand for full-time CFOs in early-stage companies. As companies compete for a smaller pool of funding, they are more inclined to leverage fractional CFOs instead of investing in a full-time position. This approach allows them to access necessary expertise while managing costs effectively. 2. Competing for a Smaller Pool of Dollars Companies seeking subsequent funding rounds face stiff competition. Investing in a full-time CFO might not be feasible, but the need for strategic financial guidance remains. This has led to an increased reliance on fractional CFOs who can provide the necessary expertise on a part-time basis, offering a flexible and cost-efficient solution. 3. The Evolution of Financial Tech Stacks One of the most intriguing points we discussed was the evolution and sophistication of financial technology stacks. Modern cloud-based systems have advanced to the point where specific technical expertise, such as tax knowledge, is integrated into the software. This reduces the need for CFOs to be experts in every technical aspect, allowing early-stage companies to operate efficiently with a bookkeeper and a fractional CFO for a longer period. The Broader Implications This trend has significant implications for the future. As interest rates drop and the venture capital and private equity sectors become more aggressive, the demand for full-time CFOs will likely increase. However, when considering the continued advancement of artificial intelligence and cloud-based financial software, we may see a considerable thinning of both the CFO ranks and their supporting staff. These smart systems are poised to handle more complex financial functions, reducing the need for extensive human intervention. Takeaway: The role of the CFO is changing. Early-stage companies are increasingly turning to fractional CFOs and leveraging advanced financial technology to meet their needs. As AI continues to enhance these systems, the financial landscape will undoubtedly undergo further transformation, challenging traditional roles and creating new opportunities. And this trend is going to go beyond the start up world into the world of the middle-market CFOs with whom we do so much work. The CFO Alliance Nick Araco JR Greg Wood Milton Corsey Misty Law Flurry Grant Wallace Roha Zaheer AchieveNEXT #CFO #Finance #Startup #FractionalCFO #FinancialTech #AI #PrivateEquity #CloudComputing #FinancialServices

Top 3 Highest Paid CFOs In The World (Chief Financial Officers) List of The 10 Highest Paid CFO In The World Below listed are the top 3 highest-paid CFOs in the world in 2023, along with their key responsibilities, notable achievements, and CFO compensation. 1. Patrick Pichette Patrick Pichette is a renowned business leader who is currently serving as the Chief Financial Officer (CFO) of Google’s parent company– Alphabet Inc. With over 30 years of experience in the technology industry Key Responsibilities: Overseeing Alphabet’s financial operations, including financial reporting, budgeting, and forecasting. Developing and implementing financial strategies to support Alphabet’s growth. Providing financial guidance to the company’s top management to support decision-making. Notable achievements: Pichette played a crucial role in Alphabet’s transition from Google’s. He has also been recognized for his leadership in sustainability. Under his leadership, Alphabet received significant success in its environmental and social initiatives. Pay & Benefits: As the CFO of Google, Pichette received a total compensation package of $16.5 million in 2023. This includes a base salary of $2.7 million and stock awards worth $11.2 million. 2. Anthony Noto Anthony Noto is a well-known financial executive and former NFL executive who currently serves as chief executive officer and the CFO of SoFi (a financial technology company). Key Responsibilities: Overseeing all financial operations, including financial planning and analysis, accounting, treasury, and investor relations. Developing and implementing financial strategies that support SoFi’s growth and expansion. Leading fundraising efforts to secure funding for SoFi’s ambitious plans. Notable achievements: Noto played an instrumental role in taking SoFi public in 2021 through a SPAC merger with Social Capital Hedosophia Holdings Corp. V. He has successfully raised over $2 billion in funding for SoFi through multiple rounds of financing. Pay & Benefits: Noto earned a total compensation package of $15.8 million in 2023. This includes a base salary of $500,000, stock awards worth $9.2 million, and a cash bonus of $6 million. 3. Safra Ada Catz Safra Ada Catz is an Israeli-American business executive who currently serves as the CEO of Oracle Corporation. With a long and successful career in the tech industry, Catz has established herself as one of the world’s most influential and highest-paid CFOs. Here’s a closer look at her key responsibilities and achievements: Key Responsibilities: Overseeing the company’s key operations, including sales, marketing, finance, and legal departments. Managing the company’s relationships with customers, partners, and investors. Pay & Benefits: In 2023, Catz received a total compensation package of $12.7 million. This includes– a base salary of $950,000, stock awards worth $9.4 million, and a cash bonus of $2.3 million. #CFO #cfoinsights #cfoservices

Most businesses without the budget or workload to employ a full-time CFO simply go without altogether. But what are they missing? What does a CFO do? Of course, a CFO may be involved in a broad range of business activities as needs arise, but in my experience the core responsibility of a CFO in a business is to help remove blind spots by providing financial leadership to the Finance Team and the Senior Management Team. Other activities that the CFO may get involved in won’t much matter if the financial storytelling is not up to scratch and the business leaders don’t understand the levers available to improve profit and cash flow. Sadly, that will be the case for most businesses lacking the financial leadership provided by a CFO. Let’s dig into that further to provide a deeper understanding of what you should expect of a quality CFO. 1. Numbers Right – Your monthly financials are accurate and can be trusted and relied upon. A CFO will elevate your bookkeeping into accounting so that your numbers are reflective of business performance. It’s surprising how many businesses don’t know the true score. 2. Presented Right – Key information is extracted from the financials and presented so that the financial story can be simply understood. A CFO will focus on reporting less, but more meaningful numbers, and interpreting those key numbers so that business leaders understand all aspects of the financial performance. Done right, you will have your financial story presented on 1 page, showing profitability, summary balance sheet and net cash flow (more on this 1-page reporting in a future post). You are flying blind if you don’t know your cash flow and why it differs from your profit. The answer lies in the balance sheet movements, and these can be managed to optimise cash flow. 3. Optimise Right – With your numbers being right, and being presented right, business leaders can optimise right. A CFO will provide financial leadership to ensure that business leaders understand the financial story and the levers available to improve profit and cash flow. One of the most powerful things a CFO can do is demonstrate the financial impact of small improvements and engage business leaders in discussions on how these improvements can be achieved. This is where the magic happens. Ultimately, a CFO is all about facilitating strategic financial management and a lack of financial leadership in your business can have enormous consequences to profitability, cash flow and business valuation, not to mention stress levels. Insightful management information and accurate financials shouldn't be something only enjoyed by big business. If you would like to know more or would like to understand options around improving the financial leadership in your business, then please reach out to me to chat further. #businessmanagement #financialmanagement #strategicfinancialmanagement #financialleadership #cashflowmanagement #businessoptimization

🛣 Navigating the Financial Leadership in Your Startup - when fractional CFO is not enough? 🛣 A recent conversation with a founder left a lasting impression on me—their startup, blooming with potential and a robust team of 100, faltered due to the absence of a dedicated finance professional. It’s a cautionary tale that underscores the necessity of timely financial leadership. The question then arises: At what stage does your startup need a fractional CFO, and when does the transition to a full-time CFO become imperative? 💭 Some early thoughts to start a further conversation: 💭 1) 🌱 Seed Stage: ~$500K Budget - External finance support  In the early days, with a tight budget and a lean team, the focus is on stretching every dollar. An external accountant can handle the basics for a few hours each month. Responsibilities include: - Managing burn rate - Keeping track of cash flows - Preparing basic journal entries and financial schedules - Ensuring basic tax compliance 2) 👶 Early Growth: ~$1M Budget - In-house finance employee As your startup matures, the financial terrain becomes more complex. An in-house finance person becomes necessary to dive deeper into: - Day-to-day accounting - Budget management and forecasting - Financial analysis and reporting - Assisting with financial decision-making 3) 🗺 Expansion Phase: $1M to $5M Budget and 10-20 Employees - fractional CFO + in-house finance employee. Here, the stakes are higher, and the financial intricacies grow. A fractional CFO can steer your startup through more advanced financial landscapes, tackling: - Complex financial modeling - Strategic planning and risk analysis - Cash flow management and financing strategies - Key performance indicators (KPI) tracking and management 4) ⏫ Scale-Up and Beyond: Over $5M Budget and 20+ Employees - full-time CFO / Leader At this stage, your startup requires a full-time CFO / Leader to fully embed into your team. The responsibilities expand significantly to include: - Leadership in financial strategic planning - Capital structure and fundraising initiatives - Investor relations and stakeholder management - Oversight of all financial operations - Regulatory compliance and corporate governance In Conclusion: Choosing the right financial leadership for your startup is not just about meeting present needs but preparing for future challenges. A startup must assess its financial complexities, growth trajectory, and strategic needs at each stage. The role of financial management is pivotal—from an external accountant to a full-time CFO, each plays a specific part in the financial health and growth of your company. The absence of adequate financial oversight can be the Achilles' heel for a budding startup. Proactive financial leadership is a strategic investment in your startup’s future. So, ask the right questions, assess your startup’s financial pulse regularly, and ensure you have the right financial expertise at every turn of your growth journey.

2/3 Benefits of Hiring Virtual CFO for Start-ups and MSME Enterprises Accurate Budgeting & Accounting: A strong and well-planned Budgeting ensures the company maintains healthy profit. Virtual CFO also assists in determining the amount of money required by combining the salary and the cost. Improve Profitability: Virtual CFO services analyze your resources and save your company from any sort of wastage. A well-planned and executed strategy boosts the overall productivity of the business. Decision Making: Virtual CFO also helps in the decision-making process of the company which ultimately leads to business growth. It analyses the finances and operations of the company by using the identification of key operational indicators. Risk Assessment: Virtual CFO recognizes potential risks and provides solutions to curb the level of risk which may influence business over the long haul and improve opportunities. Success Focused: Virtual CFO keeps a constant eye on the current market and financial condition and works continuously on a success-based model. The virtual CFO frequently tracks and evaluates factors such as production, distribution, sales, cash flow, distribution, and inventory levels which show the KPIs. Growth Strategy Mentor: The virtual CFO evaluates the business and suggests growth strategy/planning. The virtual CFO creates a suitable improvement plan, market strategy, and advanced idea in order to recognize when financing is required in the business. Access to investors: Virtual CFO also helps in the decision-making process and looking to relevant options of investors for the organization which ultimately leads to the growth of the business. Help in valuations: Business Valuations of Assets, Liabilities, and securities recognize the market equity value instruments, debt instruments, and derivatives issued by government agencies, financial institutions, and corporate organizations. Organizational Hierarchy Structure: Virtual CFO services have the power to make any changes in the organizational hierarchical structure of the company as and when needed for business growth.

99% of CFOs Have Fallen Into 1 of These 3 Budgeting Traps: (1) The Frugal Non-Budgeting CFO (2) The Excessive Non-Budgeting CFO (3) The Copier Budget CFO Frugal Non-Budgeting CFO tells his employees that they are not allowed to spend anything without approval. Need new software? Get permission. Need it again next year? Get permission again. Frugal Non-Budgeting CFOs are extreme micromanagers all in the name of financial control. They stifle agency and ownership, leading to poor performance and employee attrition. Very inefficient (and costly)! Excessive Non-Budgeting CFO tells his employees they can spend anything whenever. On the upside, the Excessive Non-Budgeting CFO lets their teams operate independently with high ownership. The down side is, there is zero strategic guidance. Spending is completely unhinged and there are few (if any) audits on existing, recurring expenses. Very wasteful (and costly)! Copier Budget CFO copies the budgets from last year with minimal changes (like 5% increases for the heck of it). “If you don’t spend it, you lose it” is common, forcing teams to spend money so they have budget for next year. The benefits of this approach are clear - it’s quick, easy and budgets get approved fast without needing to convince the board. The problem is, the Copier Budget CFO incentivizes bad behavior by encouraging teams to max out their budgets. Also wasteful (and costly!) Which trap best describes your budgeting process? Don’t worry, there is a fourth option: The Strategy-based Budget CFO The Strategy-based Budget CFO sits with the executive team (and maybe the board) and starts with Strategy. What are our goals for next year? they ask. - Getting to X level of gross margins - Entering this new market - Releasing this new product Okay. Then they go to different teams and ask 3 key questions: (1) What is your core spending? (2) What do you need to spend to achieve our strategic goals? (3) If you had unlimited budget, what would you do? Now they have 3 levels of budgets for each team and can work with leadership to prioritize, invest, and allocate. I know some people like “zero-based” budgeting - when you tell teams they have no budget for next year and built it from scratch. That can be helpful, but it is very time consuming. That’s why I place my bets on the Strategy-based Budgeting CFO to build useful budgets that maximize revenue and minimize expenses for companies. Warning: For this to work effectively, your lines of communications must be trusted and open. Which approach do you use?

Deciding when to hire a CFO for your venture capital-backed business depends on various factors, including the stage of your company, your growth trajectory, and your specific business needs. Here are some indicators that it might be the right time to bring a CFO on board: Preparing for Funding: As you prepare for a significant funding round, such as a Series A or Series B, hiring a CFO can be advantageous. A CFO can help you develop financial projections, prepare investor materials, and navigate the due diligence process more effectively. Scaling Operations: If your company is experiencing rapid growth and scaling operations, a CFO can provide strategic financial leadership to support your expansion plans. Complex Financial Needs: As your business becomes more complex, with multiple revenue streams, international operations, or intricate financial transactions, a CFO's expertise becomes essential. They can help navigate complexities such as tax implications, regulatory compliance, and financial reporting requirements. Strategic Decision-Making: If you find yourself making significant strategic decisions that have long-term financial implications, having a CFO at the table can be invaluable. They can provide financial analysis, scenario modeling, and strategic insights to support decision-making and maximize value creation. Investor Expectations: If your investors are expecting more sophisticated financial reporting, analysis, and governance as the company matures, it may be time to hire a CFO. A CFO can ensure that your financial reporting meets investor expectations and provides transparency and credibility to stakeholders. Preparing for an Exit: If you're considering an exit strategy such as an acquisition or IPO in the near future, hiring a CFO well in advance can help ensure that your financial house is in order and that you're well-prepared for the process. Managing Risks: As your business grows, so do the financial risks. A CFO can help identify and mitigate risks related to cash flow, regulatory compliance, financial fraud, and other areas, protecting the company's financial health and reputation. Professionalizing the Finance Function: As your company matures, having a CFO in place can professionalize the finance function and elevate the company's financial management capabilities. They'll establish financial policies and procedures, implement best practices, and hopefully build a high-performing finance team. Personal Bandwidth: If the founder or CEO, finds themselves stretched trying to manage all aspects of the company's finances while also focusing on other strategic priorities, hiring a CFO can provide much-needed support and expertise, allowing you to delegate financial responsibilities and focus on driving the company's overall growth and success. Ultimately, the decision to hire a CFO should be based on an assessment of your company's specific needs, growth stage, and strategic objectives.

As a small business owner, I know how hard it can be to manage all the financial aspects of running a company. There's budgeting, forecasting, financial reporting, cash flow management, and more. It can feel overwhelming trying to wear all those hats, especially if finance isn't your specialty. That's why a growing number of entrepreneurs are turning to Fractional CFOs. A Fractional CFO is a part-time CFO you bring on to handle your key financial functions. They don't join your team full-time; you pay for only the time you need. This gives you financial leadership without the expense of a full-time CFO salary and benefits. Some of the key benefits of a Fractional CFO include: - Financial strategy and planning - They can help set financial goals and create plans to meet them. This includes budgeting, forecasting, and performance tracking. - Reporting and analysis - They can prepare key financial statements, analyze data, find insights, and report on performance. This helps you make informed decisions. - Cash flow management - They can monitor cash flow, accounts receivable/payable, and suggest ways to improve it. This keeps your business financially healthy. - Financial processes - They can establish or improve systems for billing, collections, payroll, and more. This boosts efficiency. - Mentorship - An experienced Fractional CFO can mentor you on financial management and be a sounding board for strategic decisions. - Compliance - They can ensure you meet legal and accounting compliance requirements. This reduces risk. - Capital strategy - They can help you identify capital needs, choose sources, and negotiate terms. This fuels growth. A Fractional CFO gives you just the right amount of financial leadership your business needs, without the huge expense. If you're feeling stretched thin or lacking financial expertise, it's time to consider hiring a Fractional CFO. The benefits for your bottom line and peace of mind could be immense. What are you waiting for? ----------------------------------------------------------------------------------- My name is Jeffrey Johnson. I am a Fractional CFO..I am here to help your business grow profitably, while still maintaining positive cash flow. DM me, if you would like to explore working together.

“I don’t think a lot of business owners actually think about the difference between a strategy and the execution of it.” What to know before hiring an outsourced CFO? In this Fortune article, our CEO, Chris Arndt, suggests finding out where the outsourced CFO firm’s services end. You might find one, “that wants to kind of wave a wand and say, ‘You need to change how you do this or do this, or change your accounting here,’” he explains. “And then they don’t want to roll up their sleeves and get involved in the execution and the operational [side of] accounting to make that happen.” In that case, decide who will follow through, Arndt counsels. Read more about the "new" CFO: https://lnkd.in/gVBfvZtq #CFO #outsourcedCFO #fractionalCFO #CFOservices