by Rob Joseph, Director, BeaconCFO Plus
What the Role Is—and What It Is Not
If you are unsure whether your organization needs a CFO in any capacity, let me refer you to the book Startup CXO: A Field Guide to Scaling Up Your Company’s Critical Functions and Teams. Matt Blumberg—the founder and CEO of Bolster—has gathered advice and insights from his experienced team designed to help startup organizations scale their business over time and navigate the challenges in doing so.
In one chapter of the book, John McCarthy, a seasoned CFO with experience working in a fractional capacity, boils down the need for a CFO, noting that every company needs someone to help them understand the finances and make sure the financials are organized.
“If you don’t have your financials in order,” McCarthy states, “Then that’s the time to bring somebody in.”
That someone might be a full-time CFO, or it may be someone in a fractional capacity. But it needs to be someone with broad experience who can serve as a coach and as counsel to your organization and its leadership.
Let’s address—and clear up—some common misconceptions about the role of a fractional CFO.
- A fractional CFO is not a replacement for an existing CFO—they are an extension of your team and there to support your team’s ongoing efforts.
- A fractional CFO is not looking to become your organization’s full-time CFO—they will transition out of the role at the appropriate time.
- A fractional CFO is not an outsider who will make sweeping changes without understanding the mission of your company—they will make thoughtful and intentional recommendations while remaining committed to your mission.
- A fractional CFO is not someone who clocks in and out on Mondays and Thursdays without a thought to your organization during the rest of the week—they will do what’s necessary to keep strategic initiatives moving forward, respond to questions, and provide support.
What Defines the Role of a Fractional CFO?
“I’ll help counsel CEOs on what the numbers are really saying, what the vibe in the company is saying, or counsel them about the future of where the company is going. I can put that into a context based on all of the things that I’ve seen—the successes, the failures, and all the stuff in between.” – John McCarthy, Startup CXO
In the book, McCarthy details many characteristics of a fractional CFO, including:
- Broad experience
- Ability to be flexible and adapt
- Strong time management skills
- Strong organizational skills
- 100 percent committed to the company for the duration of their involvement
A fractional CFO is there to serve as a resource and an asset to your team—again, not a replacement. They help you know your numbers, use financial data to make better decisions, and chart a long-term strategy for growing your business. They will also help with recruiting key financial personnel, including finding the right person to take on the role of CEO full time for your organization, helping to train that individual, and eventually pass on the finance “keys.”
Does Your Organization Need a Fractional CFO?
Work With BeaconCFO Plus
If your organization needs someone to help you better understand your financials and develop a financial strategy for the future, a fractional CFO might be the answer. BeaconCFO Plus offers part-time and project-based CFOs with experience in a broad range of industries. Reach out to us to schedule a time to speak directly with one of our CFOs about your unique business and current challenges or goals.