A business owner is like the mother of the company—they handle marketing, operations, client relationships, and oversee finances. But managing the vast majority of this work requires subject knowledge; otherwise, a wrong decision at a critical time can create a financial emergency. You don’t need an emergency department for that—all you need to do is employ skilled people, for instance, an accountant and a financial expert. There is no replacement when it comes to finances. Your accounts and financial activities define the overall economic health of the company. This is why you need an overhead like a CFO who can assist you in growing your business at a steady rate. Whether you need a CFO or not may seem like a personal choice, but rely upon crucial factors such as your business’s expansion, location, finances, accounts, staff members, and operations. The CFO takes care of three vital fundamentals of your venture—Finance, Operations, and Growth.
If you are unable to manage the hefty load of the multiple departments of the corporation, including finance, hire an expert CFO and an experienced accountant in Mt Vernon, NY, immediately.
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Why do I need a CFO for my enterprise?
CFOs, or Chief Financial Officers, are experienced professionals responsible for cash flow management, financial planning, and regulatory compliance. They handle revenue, debt collectibles, profits, and losses by optimizing your business operations and accounting processes. This, in return, helps you and the company ensure enough liquidity for future operations and growth. They act as the head advisor to the CEO (Chief Executive Officer) of the company, guiding them on strategic financial decisions.
A CFO knows how investors, market capitalists, and investment bankers think, meaning they understand the pillars that can make your business much more valuable in the eyes of a potential buyer. Most often, startup founders and business owners think narrowly about finance and accounting—they believe an accountant can act as a financial expert similar to a CFO. While that can work in some cases, an experienced CFO has the wisdom that is crucial for business growth. In simple terms, you should think of hiring a CFO more broadly. Sure, clean books, organized records, and financial control matter, but a CFO brings much more than just housekeeping to the forefront.
When do you know your Startup can’t thrive without a CFO?
Exactly when a company requires a CFO and can’t live without one depends on several factors, like company size, growth rate, revenue model, and the complexity of the organization and its financial systems. If your business is smoothly making $15 to $20 million annually in revenue and you don’t have a CFO, then you’re pushing it. Can you sustain this exponential growth and get by? Probably, yes. But at what cost? For instance, if the business is making this threshold of money and you are saving equity shares, assets, and other income streams, believing you will have a big chunk of money in retirement, you are mistaken. The economic inefficiencies and risks you and your business are exposed to far outweigh your retirement financial numbers. Without a CFO, you don’t have established decision frameworks, operational controls, systems, and measurement disciplines to scale effectively.
Business isn’t just about selling or revenue—it goes beyond that. A CFO helps you tackle scenarios like unmanageable finances and faulty business perspectives. They use the company’s historical data, such as bank statements and account details, to obtain valuable insights and patterns that can determine the loopholes in the financial flow. This data is then magnified to make smart business decisions.
Even if your startup is worth $10 to $20 million, you still need an expert head—i.e., a CFO—to handle your finances. As the company grows, the billables, revenue, finances, staff members, payroll processes, taxes, assets, and liquidity grow.