What is a Fractional CFO?
A fractional CFO, also known as an Interim or Virtual CFO, provides high-level financial expertise on a part-time basis to businesses that do not require a full-time CFO. You get access to the same range of services and expertise without the considerable expense of a full-time employee with a typical salary range of £150k to £250k+.
A fractional CFO gives you flexibility. It means you can work together on a short-term basis to help achieve a fixed goal, such as raising investment, selling the business, buying another company, or working on a longer-term plan to scale the business from as little as one day per month.
The Benefits of Working With A CFO
Having a CFO on your team will give you an expert who can help you make sound financial decisions, manage risks, identify opportunities and ultimately grow your business. The already overworked CEO would typically ignore or handle many of these business areas. A CFO can act as a great support partner for the CEO.
A CFO Can:
- A fractional CFO can work remotely or alongside you in your office, depending on location.
- Help the business to develop and execute a strategic plan that aligns with its goals and objectives.
- Help the business measure the correct numbers and understand how they can be improved.
- Help spot the need for additional cash and manage the process of fundraising.
- Reduce risk and ensure measures are in place to protect the business.
When do I Need a CFO?
Typically businesses won't hire a full-time CFO until they hit £25-50m in Revenue, but the beauty of a Fractional CFO is that you can start much earlier Every business has different needs, but the four scenarios below might be a good lime to consider starting:
- Your Revenue has exceeded £1m.
- You will be fundraising within the next six months.
- You have too little or too much cash.
- You are looking for fast growth.
- You are considering buying another business or selling up yourself.
Working Alongside Your Finance Team
The real value of a CFO lies in the strategic thinking they bring to the business. Whilst they will also be involved in operational support for SMEs, you will need a finance team around them to benefit the most.
If you already have a finance team, your CFO can work alongside them, offering support through training, mentoring and hiring.
If you have gaps in your finance team, your CFO will work with you to fill these. The virtual finance function from Crisp Accountancy can help here.
Services Overview
The services you need from your CFO will differ for each business and change as your business grows. Once we understand your goals and where you are, we will build a bespoke project plan. All our CFOs have a wide range of experience covering the following services:
Business Plan & Strategy
The business plan is the starting point for your CFO. We can help you build or rework your plan to cover everything from your long-term vision to the specific 90-day actions needed to drive the business forward. Accountability is critical to keeping you on track with the plan.
Risk Management
Identifying and minimising risks is a key role of a CFO. We will work with you to create a complete list of risks, both internal & external, rank these in order of importance and create a plan to mitigate these.
Exit Planning
It can take up to 5 years to maximise the valuation of your business when selling, so it's always early enough to start. We will help you get to the bottom of what you want. We will create and implement a plan to make your business as attractive as possible to potential buyers. The selling the process can be highly stressful and is full of pitfalls; your CFO will be experienced in this area and can hold your hand or take the lead.
Mergers & Acquisitions Support
Mergers & Acquisitions can be one of the quickest routes to growth but can be daunting for the inexperienced. We can help identify opportunities, carry out valuations, help structure deals and take care of due diligence.
Fundraising
Identifying a future need for additional cash is the best way to maximise your chance of securing the money at the best price. Many options are available for raising cash, and we can help you explore which path is best for you. We have plenty of experience working with angel investors, Venture Capitalists & Private Equity. If you decide to raise equity finance and bring in an investor, we can help you get the business ready for investment, manage the fundraising process and handle investor relations afterwards.
Forecasting, Budgeting & Financial Modelling
Forecasting has many benefits, whether creating a model to help you raise investment, spotting future opportunities or issues with long-term forecasting, or using budgets to track your progress and create accountability. We will build, update and embed these forecasts into your regular
financial reporting.
Building Systems & Controls
Great systems are the key to rapid growth. We will use our experience in systemising and automating businesses to map out your existing processes. We can remove bottlenecks and work on the areas that deliver the greatest reward. Our love of technology plays a big part in this process.
Mentoring & Training
Finance is a complex area of business that is vital for all to understand. We will work with the company's senior leaders to improve their financial understanding and decision-making. We can help hire, train and mentor your in-house finance team too. A finance function fit for purpose is vital to enable growth.
Management Information & Metrics
Occasionally looking at your Profit + Loss is not enough to empower you to make better business decisions. We will ensure that you have access to accurate, timely and relevant financial dashboards and that you truly understand what these mean.
Cash Flow Management
The biggest cause of stress for many owners is cash flow. Cash flow problems are always the symptom of poor controls or tight margins. We tackle this in two ways. First, we build cash flow forecasts and help you stay on top of your bank balance. Secondly, we will look to identify and fix the root cause of the issue.
Profit Improvement
Pricing has one of the most significant, direct impacts on your profitability. We will create a pricing strategy with you that maximises your profit. Monitoring and reducing your overheads and measuring efficiencies are other vital tasks we can cover.
Luke Desmond Your Fractional CFO
Having a CFO on your team will give you an expert who can help you make sound financial decisions, manage risks, identify opportunities, and ultimately grow your business.
I am proud to work closely with a deliberately small group of clients as their CFO, alongside my team.
The services you need from your CFO will differ for each business and change as your business grows. View my brochure to view the typical areas that I work on with clients.
Testimonials
Working with Luke as our fractional CFO has been a game changer for our business. Luke helped us to nail down our pricing strategy and boost our profit margins, which has had a significant impact on our bottom line. We have a much deeper understanding of our numbers, which has given us the confidence to make strategic decisions about growing our business. Luke is not only highly skilled and knowledgeable in finance but also a great communicator, who makes complex financial concepts easy to understand. We highly recommend Luke to any business looking to improve their financial performance and grow.
We have been working with Luke as our fractional CFO for over a year now, and the impact he has had on our business has been tremendous. As our business grew rapidly, Luke helped us to build key management information that has been essential for making informed decisions and feeding back to investors. Luke was instrumental in preparing our business for investment, providing valuable guidance on financial forecasting, budgeting and metrics. He also actively played a part in helping us raise investment, talking to investors and overseeing Due Diligence during fundraising and then during the $30m exit when we sold the business. One of the most valuable things Luke has done for us is help us understand our complex cash flow situation. His expertise in cash flow management has allowed us to invest in ourbusiness without worrying about running out of money. Luke is not just a financial expert, but also a great problem solver and a pleasure to work with. His communication is clear and concise and he is always available to answer our questions. We highly recommend Luke to any business looking to improve their financial performance and make strategic decisions about their growth.