How can Virtual CFO Services be a Solution for Your Company or Startup?
CFOs play a vital role in the company’s financial well-being, as they shoulder various crucial pecuniary responsibilities. However, that makes CFOs expensive resources, especially for startups, who aren’t necessarily able to hire a regular CFO unless he is one of the investors. Besides, initially, the work volumes and numbers aren’t as significant for an in-house CFO to manage. Accordingly, startups, or even SMEs for that matter, require an individual who serves as the CFO but who comes without the exorbitant employment costs attached to him. Precisely, the solution is Virtual CFO.
What is a Virtual CFO?
A virtual CFO does everything that a conventional CFO does, except that he works remotely or virtually. Besides, virtual CFOs are external resources that are an integral part of the client’s company’s C-Suite.
Why Should SMEs or Startups Hire a Virtual CFO?
Virtual CFOs offer various benefits on the commercial and the operational front. Let us look at them.
- Considerable Cost Savings
One of the first and the most significant commercial advantages of hiring a virtual CFO is substantial cost savings. Hiring a full-time in-house CFO can cost you, as a startup, lakhs of rupees. Such a high initial investment that too on employing a single resource can dry your investment reservoir up.
In situations like these, hiring a virtual CFO proves helpful. With a virtual CFO by your side, you only have to pay the resource fee. Other costs related to employment benefits, etc., are borne by the external party that provides the service. So, while you ensure your finances are managed well, you do not spend as much as you might on an in-house CFO.
- Initial Forecasting
Virtual CFO resources are selected by external service providers based on the diversity of their experience with similar types of companies and technical expertise. For startups, this proves beneficial. Since you might not be able to hire a regular CFO, a virtual CFO fills in the position and helps you with the crucial initial forecasting aspect. Accordingly, he can help you win investments based on effective and comprehensive initial forecasting.
- Early Expense Management
As a startup, your initial expenses may get out of control. Here, you need solid financial control policies in place to ensure your employees spend on only what is genuinely necessary for your business. A virtual CFO formulates the financial policy of your business and helps you enforce controls that monitor costs, flag unnecessary expenditures, and thus ensure efficient early expense management.
- Scalability
When you grow from a sprouting startup to an established organization, your numbers too will grow and become increasingly intricate to handle. You’ll have several ledgers, expenses, a significant amount of revenue, compliance, vendors, clients, associates, etc., to deal with. Working with an experienced professional with a strategic understanding, precisely like a virtual CFO, proves beneficial here. You can have him scale your processes to manage your finances better. Similarly, when the situation is otherwise, a virtual CFO can help you scale down the processes.
Need the best virtual CFO services? From financial planning, forecasting, budgeting to routine financial administration and management, Biztree does it all. For details, connect with Biztree at +91 9028499520.