CFO as Service – Why and How?

The CFO, or Chief Financial Officer, is responsible for a company’s financial management and financing. In many companies, the CFO may also be responsible for other functions such as human resources and IT. Right at the beginning of the article, we get to the heart of CFO responsibilities. The CFO has overall responsibility for these functions and their effective management, ensuring that set goals are achieved. However, the CFO is neither an accountant nor a finance manager. In this article, we will explain why outsourced CFO services are worth considering for small and medium-sized enterprises (SMEs). Welcome aboard!

Who and what kind of companies is outsourced CFO as a service suitable for?

Outsourced CFO services work best for companies with a turnover of approximately 10-20 million. Similarly, in the early stages of a company, such as startup companies, the CFO’s insight and experience provide concrete assistance and clarity in operations and administrative processes, especially if preparing for future financing rounds. Another suitable metric for evaluation is the number of employees, typically around 10-50 depending on the company’s industry. Outsourced CFO services add value to client companies by providing part-time CFOs who bring their extensive and diverse experience to the company cost-effectively, risk-free, and effortlessly. Ultimately, the most important task of the outsourced CFO is to free up the company’s top management, especially the CEO, to focus on other business activities. In addition to the above, an outsourced CFO is also excellent at managing other outsourced services, typically including accounting and payroll.

What business challenges can an outsourced CFO solve?

At Finaly, we always emphasize that financial management should be seen as support for business rather than just a support function. An outsourced CFO can solve issues related to improving a company’s profitability and obtaining financing for growth. Of course, efficient financial processes and the peace of mind brought by an outsourced CFO also give the company’s top management more time to focus on business development and leadership. The presentations and insights provided by an outsourced CFO on topics such as cash flow forecasting and asset development are things that will surely pay off quickly.

When should a company consider acquiring an outsourced CFO?

Naturally, the need for an outsourced CFO is best understood by the management of the respective company, but often outsourcing CFO services become relevant when the company is in a growth or transition phase. Are you, as a CEO, struggling with these issues? Typically, the need also arises when the company does not have access to sufficiently high-quality reporting on its financial situation. As a rule of thumb, acquiring an outsourced CFO should be considered when the decision-making of an SME requires facts that an outsourced CFO can provide.

Companies in the situation described above often consider hiring an internal CFO or even scenarios where they continue to handle the tasks themselves. “No outsider knows and understands my business as well as I do myself.” At Finaly, we believe that internal growth barriers often hinder a company’s success, and that’s why every company needs external coaching and support. An outsourced CFO exists for this purpose, to develop the client company’s business.

How can a company acquire an outsourced CFO, and how does the collaboration work concretely?

At Finaly, we exist to make people love finance. Simply put, outsourced CFO work is carried out according to a jointly planned roadmap after initial interviews and workshops. We want to help everyone understand the benefits of good financial management and an open and transparent financial culture. We don’t just produce reports or send them by email; we want to be involved in the company’s everyday life.

Many also ask whether we work remotely or at the client’s office – the client always chooses the methods and models of operation. Some things work fine remotely, but we recognize that face-to-face meetings are valuable, especially in the early stages. Modern financial management should be smooth and multi-channel communication that doesn’t hide behind spreadsheets or numbers.

Consider these aspects when outsourcing financial management:

  • When were financial management processes and practices last evaluated as a whole, i.e., how transparent is the financial management culture in the company?
  • How much time does the company currently spend on financial management?
  • Does the company’s management and board have up-to-date reporting and forecasts to support decision-making?
  • What experience and expertise does the outsourced CFO have? Is the work done “human-to-human”?

Are you facing challenges in measuring your company’s finances, or is your company’s management spending too much time on financial matters? At Finaly, we’re happy to help; contact us, and let’s see how we can assist you in a free consultation!

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