When do you need a CFO?

​​Sometimes it is difficult to determine if or when you made need a CFO for your company. I look it at in two phases. 

The first area is when things are changing at a reasoned pace. You may even have a bookkeeper that takes care of the day to day activities. But as times goes on, you may start to have a lot more questions about your business that are going unanswered. And you either don’t have the bandwidth or possibly the knowledge to answer the questions. Some of those questions are:

• Are some of my products more profitable than others?
• Am I overspending for certain items or people?
• What opportunities am I leaving on the table?
• I used to have my arms around all financial aspects of my business but I don’t anymore…what happened and how do I fix that?

The second area is when there is a bellwether event that occurs. When that happens it is fairly evident that you need a CFO. Some of those events include:

• If you are looking to raise money from external investors or borrow money from financial institutions
• You are opening a new line of business
• You have merged with or acquired a new business
• You have landed a substantial client that has dramatically increased your revenues

In either case, a great solution that allows flexibility from a time and cost perspective is an outsourced CFO. There is no heavy or long term commitment and you can determine in short order whether you do in fact need a CFO. You may only need one on a part time basis as your business evolves. Then one day you may transition to a full time CFO. But a part time CFO is a great middle term solution.

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