Startups, MSME companies and early stage mid size corporates mostly focus in their formative years on operations and core business. In the process, the accounts department mostly gets less attention. However, as the company grows this needs to change. Fortunately today with virtual CFO services the transformation can be fast as well as cost-effective. Given below are scenarios where a virtual CFO or CFO at fractional cost will be suited :
- Your company is looking to raise funds from investors and you need insight on the valuation of your company and preparing for due diligence.
- Your company is looking to raise debt from multiple banks or finance companies and needs professional advice on the form of debt to take, the terms and conditions and also prepare forecast and business plan for bankers and take care of all the documentation till disbursement of debt/loan.
- Your company is growing very fast and the accounting department is not able to cope up with the compliances and is overwhelmed with new taxations and accounting challenges such that they need support regularly.
- Your company is facing a challenge in understanding the cost and profitability of the company with rising input costs and customer pressure to reduce prices and the accounting team is not able to present the correct perspective
- Your company wants to enter into a partnership or joint venture (JV) with another company and requires feasibility study and preparation of business plan, JV agreements and various formality for successful start to a JV.
- Your company needs an oversight on accounts department to ensure all best practices are in place and compliances are handled professionally.
The above are only a few illustrative scenario.
Now the question in your mind would be that why not have a full time First CFO??. Well, you can always have a CFO but consider the following
- A full time CFO will come at huge cost differential as compared to a virtual CFO. The cost of virtual CFO shall be a fraction of the full time CFO Costs ( do not forget that a full time CFO will also paid bonus and retirement benefits)
- Not only that if your company is appointing a highly paid CFO for the first time you may not be able to get the right candidate. The cost of appointing and reappointing will be quite high. Also based on our experience when a professional joins in a existing accounting team that has never got such exposure it takes 1-2 years to integrate and for team members to adjust. All this time the goal of organisation (for example investor round or JV opportunity) may not wait and company can loose out.
- Our virtual CFO services will also provide in addition to the finance function services such as audit, tax planning and valuations
- Every company looking for a CFO for the first time should give Virtual CFO services a chance because the upside is quiet attractive.