As a company accelerates into the early growth stage, new challenges and priorities arise. Many founders have met this initial success through mentorship, affordable junior talent, contract bookkeepers, and internet advice—an admirable accomplishment. But alongside this growth comes complexity, and the need for an elevated expertise.
Whether it's Series A fundraising, risk management, or strategic forecasting, this complexity often prompts startup founders to question: Is it time for a full-time CFO? Founders want to think big-picture, but might lack the nuanced perspective—and hiring a veteran CFO full-time isn’t the only solution.
Enter: The Fractional CFO
A Fractional CFO is a part-time or contracted Chief Financial Officer who provides strategic oversight and high-level expertise without the full-time commitment.
For most companies in the early stages of growth, hiring a full-time CFO who has spent a decade in Fortune 500 companies isn’t realistic or even fiscally responsible. An affordable hire would likely be someone far less experienced. What does a company at this stage actually need? Someone who can guide their financial strategy and ensure they have the capital, resources, and direction for sustainable growth. That’s where the Fractional CFO comes in.
Yes, it’s true this option comes at a fraction of the cost. But those who say Fractional CFOs are for people who can’t afford to hire a full-time CFO are missing the full picture and the many benefits.
Top benefits of a Fractional CFO for an early-stage company
A full-time CFO can command not only a high salary, but also expensive benefits, bonuses, and likely even an equity package. Beyond the cost savings, consider the other important benefits that come with a Fractional CFO:
Strategic focus
A Fractional CFO is hired to work on higher-level items. Their dedicated hours are spent on strategic concerns like pricing models, FP&A, fundraising planning, and profitability optimization, ensuring the company’s growth continues on an upward trajectory.
Applied expertise
Something every business owner should understand—Fractional CFO work attracts individuals in the prime of their career; those who have worked in Fortune 1000 or high-growth companies, in multiple startups, and across industries. Fractional CFOs adapt their expertise to the company’s needs to provide the right information at just the right time.
The perfect fit
CFOs with high-level expertise look for work that excites and challenges them, and the strategic potential of an early-stage company can meet that criteria. That said, an experienced CFO likely wouldn't be challenged enough in a full-time role at an early-stage company as it would likely include the less-strategic responsibilities of an accountant and controller.
The key to sustainable growth
As a company grows and faces increasing complexity, it’s natural to look for an expert to step in as soon as possible. But before you do, it’s important to consider your options.
At Ascent CFO Solutions, we step in to fill in all the gaps that come with a company’s growth—including the Fractional CFO role. Our full-stack financial team can also step in with controllers and accountants to close the books, produce monthly financials, process payroll, manage payments, and complete bank reconciliations. At some point, every growing company needs a long-term, proactive approach to running their business—and we can help.
3 signs that a Fractional CFO may be a better fit
The cost of a full-time CFO strains resources. If hiring a full-time CFO means straining resources or selecting a less experienced candidate, consider a Fractional CFO.
Strategic input is needed, but not every single day. If the company can manage administrative financial operations with an accounting manager or controller, hiring a Fractional CFO to focus on the big picture insight and strategic guidance could be very cost effective.
A full-time CFO wouldn’t feel challenged in the full-time role. Experienced CFOs look for work that challenges them, like managing investor relations, doing strategic planning, and scaling operations. If a significant amount of the full-time CFO’s role would consist of administrative tasks, a Fractional CFO, paired with a full-time Controller would likely be a better fit. By hiring a Fractional CFO who focuses on strategic work, the company can attract a higher caliber professional.
Growth is exciting: Let’s fill in the gaps!
The early stages of business growth are full of excitement and possibility. Instead of struggling to keep up with the growth, or making big decisions quickly—simply reach out.
Our financial team provides the expertise you need, when you need it.