Working in a Startup/SME comes with its perks – you get to work on exciting new projects, build a brand from scratch, and develop all marketing exercises with brand new insights. Creating the brand and getting the product/service market-ready is one of your key action items with effective sales and business development, the next item on the list.
While you’re caught up with these factors of your business, the thought of a good financial process only makes an entry when a financial crisis rears its head. That’s precisely what’s happened to many Startups/SMEs across the board during the COVID pandemic, and managing your finances has suddenly become your number one priority.
If you’re in a business in the nascent stages experiencing similar headaches, you’re not alone.
There are plenty of Startups/SMEs that don’t have a detailed and structured hierarchy, and it can be daunting to figure out the finances on your own if you lack experience in this department.
To battle this out, a CFO is what your company needs, as their insights can help protect your critical financial assets during this crisis. However, onboarding a permanent CFO is not a practical approach because your resources are focused on operations, and revenues are already stretched thin. So, what’s the way out?
Consider Virtual CFO. An individual or entity that takes on the role of a CFO (chief financial officer) in a remote way, helping you outsource your core financial operations virtually.
Why is VCFO the best option for your business? Apart from being able to curb your financial prospects remotely, these virtual CFOs can save your company a ton of money by being cost-effective.
They are also an effective option to streamline the financial process by providing timely insights to maximize profits and cut on costs earlier in your business cycle.
Can Virtual CFOs be Effective for a Company like Mine?
Considering the way businesses are struggling to stay afloat, virtual CFO might be the supportive lifeguard you need to get through the COVID wave!
Let’s accept it – businesses are finding it hard to keep their finances in check, and every company requires a viable financial strategy and execution to flourish.
With the COVID-19 crisis at hand, a lot of Startups/SMEs are struggling with their finances. While most bootstrapped or minimally funded businesses had financial activities relegated to basic bookkeeping and taxation, they’re now in need of someone who can help save their money, and in some cases – even the company.
At this point of time, you’re probably trying your best to keep the company afloat even after the unfortunate layoffs, furloughs and other cost-cutting measures. A virtual CFO is a viable solution because it can help you oversee your company’s financial aspects.
Their expertise and insights can help guide your business in minimizing business risks, providing an acute decision, and charting out a long-term plan for the upcoming financial year to steady your company’s boat.
Here are some benefits you can enjoy by outsourcing your financial troubles and embracing the potential of a virtual CFO in your company –
- Make it cost-effective –
This is the time for an almost extreme cost-cutting requirement, and a virtual CFO will enable you to do that. The average salary of a CFO in India is a whopping 3,556, 440 and that can be a sizable chunk of your operational budget.
A virtual CFO will help control costs by giving you only specific services and deploying their abilities only when required. Most virtual CFOs are veterans who can help you with your financial strategies as per your needs. You can pay them as outside consultants and rely on their advice only when it’s required.
Even if you have them on a retainer basis, you can save a lot of money by incurring a nominal fee for timely services. You won’t have to provide extra benefits and other employee perks that are part of your company, thus saving crucial money that can be reinvested somewhere else.
- Provide expert opinion on growing your business –
Once the virtual CFO receives a lowdown of your business, you can trust them to provide you strategic advice on how to grow your business.
Most virtual CFOs work with a diverse range of clients, so their knowledge and expertise are varied and expansive. You can tap into this experience and get some sound, expert advice on how you can grow your business.
The virtual CFO can also work with a handful of varied problems and provide a great sounding board on growth. Their insights can help you carve out your next steps to take in long-term growth which may be crucial for the business.
- Streamlining your financial strategy –
Your financial strategy needs to be aligned with your mission statement and match the vision of your company. A virtual CFO’s contribution can streamline this financial strategy based on your current revenue and budget and outline the scope of work that’s needed to be done.
Depending on what area of business your SME is in, there are different financial needs in hand. The services a seasoned virtual CFO provides can help you understand how you need to budget and allocate your money.
Virtual CFOs can also grow with your company and realign the goals based on how you progress. They can start by taking over the bookkeeping and get into the whole financial planning aspect, controlling cashflow management to forecasting growth trajectories over the long term.
The needs vary as you grow, and a virtual CFO can help you explore different financial options and choose one that works best for you as you along your business cycle.
I’m Sold on the Concept of VCFO, but Don’t Know if it is a Viable Long-Term Option
Virtual CFO services may seem like a lucrative option for you to jump in to emerge from the present economic uncertainty and the impending recession phase ahead of us. It’s crucial to figure out if a VCFO service is what your business needs to survive in the long run.
The below scenarios can help you effectively decide if you should consider VCFO as a viable option for your company –
- The company’s financial processes become more complex with time – While you may have started as a small, garage-owned business, your company’s needs have expanded over time. You’re now expected to partake in crucial decisions regarding hiring resources, reaching out to vendors, and expanding your clientele. As a business, you now understand that a simple book-keeper job is not helping you manage your costs effectively. What you’re lacking is an experienced finance professional to provide insights on how to regulate your expenses in the company better and ensure you have good profits.
- Facing high growth but lacking good strategy – While every company aspires to hit a rapid growth, things can soon spiral out of control if your financial strategy is not in place. What you’re lacking is well-experienced personnel who can help you stabilize the company during periods of accelerated growth and implement strong measures in place as the company sets foot in the next phase.
- You’re not an expert, but need one – Not everyone is blessed with a good sense of numbers, and if you’re one of them, we completely agree. What you need is a good mentor that can help streamline your business and provide clarity around your finances so that you can make sound decisions. As a start-up, if the majority of these scenarios rings true for you, then it’s best to take a plunge and opt for virtual CFO services today. The best part is they’re easily accessible and super simple to work with. You provide them the necessary details regarding your financials, and they’ll get to work on formulating a strategic plan for your company.
As your financial partner, we are here to help you make informed decisions in lieu of your strategic financial goals and forecast your growth trajectory well in time.
With our Virtual CFO services, you can save a ton of money and also receive the right advice to move towards your next set of business goals with ease.
Consult with us today.