What is a Fractional CFO

Is this the Financial Story of your Business?

As a small to medium size business owner, you already lived through the solopreneur financial life– You, yourself and “Hey, You!”. And you have a concept of how a large, corporate business does it – CFO, Controller, Bookkeeper, Accountant, AP and AR. But your company is not that big yet, and maybe you don’t ever plan to be that corporate.

  1. “You!” Remember when it was just you? Sending out invoices and collecting inbound payments.
  2. Accountant. Filing your taxes and giving you instructions to fix last years books. Looking backwards in time.
  3. Bookkeeper. A regular tidy up and reconcile of the books to keep everything you have done in order. They work in the present and back in time.
  4. Past in Order. Everybody so far has been helping you pull the past into compliance. This is all good, but it does not forecast the future.
  5. Future in Mystery. The monthly and quarterly reports do not tell you which business lines are the most and least profitable. Or which costs could be reduced, and which investments would be best to increase.

Spoiler Alert: The big 3 financial reports – even when you know how to interpret them – do not tell you the key drivers of future profit in your business.

What does a Fractional CFO do for you?

Fractional CFOs are independent resources who guide you and your business through financial choices and challenges. ‘Fractional’ simply means that they work for several different clients. Just like your bookkeeper, accountant, attorney, web tech or HVAC company. (Spoiler alert: they do charge more than those guys)

To prepare for your monthly update, a good Fractional CFO will:

  • Review and understand your most recent finances, ahead of the meeting (They loooove those books!)
  • Create a high level scoreboard from the books that shows you
    • If your cash is hiding from you. And where.
    • Whether more of your cash could be accessible right now
    • How many weeks/months expenses you really have to hand
    • Which of your cash is deployed to profit, and which to loss.
    • Is your cash safe? (Looking at you, FDIC uninsured)
  • Prioritize the options to improve profit and cash flow
  • Give you manageable goals and tasks for the next 30 days
  • Bring a background of experience. They’ve seen it before.

Most Fractional CFOs specialize within an industry and/or growth stage of companies. There is a whole cadre of Fractional CFOs dedicated to the fast movig world of tech start ups. We are not in that field. We specialize in regular, local businesses: $500k – $5m. We have a lot of clients in construction and Real Estate Development, a few in health services.

Can a Fractional CFO help you find more Cash?

CFOs, whether they are full-time or fractional, guide you on the financial choices and future of your business. They show you

  • What is your cash doing right now?
    • Do out know?
    • Is it hiding from you?
    • Could more of it be accessible?
    • Does more of it need to be on standby?
    • Is any of it good money following bad money into an abyss?
    • Is it safe?
  • Where will your cash be in the next 30 Days?
    • Funding profitable work?
    • Deployed into a loss leader?
    • Covering up areas that will never be profitable?
  • What is planned for your cash in the next 90 days or in the next year?
    • Are there new lines to be funded that will take cash?
    • Are there legacy lines to be retired that will release cash?
    • Does the business have the cash planned for owners draws?

A Fractional CFO can help you

Get in touch! Book a 30-minute call to sound us out.

We are nerdy, but we care

Most CFOs and Fractional CFOs got into forward-looking finance because we like helping and we enjoy collaborting

Numbers are our thing

We enjoy running projections. Between our times with you, we are thinking about your business and playing different strategies out.

We have a playbook

We are used to working with $500k - $5M businesses. All are different but there are some key drivers we know to look for in each.