If you’re the CEO of a startup, you’re probably wearing a lot of hats and juggling multiple roles at the moment. Although trying to take on every aspect of running a new company can seem like an ideal way to cut costs, in the long run, it’s more likely to lead to burnout. Trying to do everything yourself can also lead to massive mistakes, especially if you’re running your first business.
While your company might not have the budget right now to hire a team of full-time executives, it can most likely afford to outsource some of the roles. Hiring an outsourced or virtual CFO can help to streamline your operations and improve your startup’s finances. Take a look at some of the responsibilities an outsourced CFO can handle.
Your startup needs money to operate, but getting that capital can be tough, especially if you’re new to the business world and don’t have a lot of connections yet. A virtual CFO can provide significant guidance when it comes to locating sources of capital and helping you choose the forms of capital that are most appropriate for your company.
Often, businesses can seek out debt financing, such as loans from banks, or equity financing, which comes from investors. Your CFO can act as a bridge between your startup and sources of funding. They can make the appropriate introductions to investors or lenders and act as an intermediary between you two.
They can also help you weigh the benefits and drawbacks of each funding option, helping you choose the financing that will pave the way toward growth and success.
Developing a Business Strategy
Running a business might have turned out to be more complex than you anticipated. An experienced virtual CFO can provide the guidance and knowledge you need to develop an effective business strategy.
In the best cases, a vCFO will go above and beyond when implementing a strategy. They will let you know what concrete steps to take to put it into action and help drive your business into the future.
Your outsourced CFO is a neutral, objective party regarding business strategy. They don’t have the emotional investment you do in your company, which means they’re better equipped to make recommendations and provide actionable insights that will deliver results.
Planning for Profitable Growth
Your startup might enjoy a period of rapid growth initially, then seem to hit a wall or plateau. You might not know what’s going on or what you can do to get off the plateau and restart growth.
A virtual CFO will, though. They’ll examine your company closely and make recommendations that will allow it to grow and thrive. They might offer guidance on programs to implement or ways to correct course to get back on the path toward growth.
Finding Ways to Save Money
While you might have to spend some money to make money, in the long run, the goal of your startup should be to cut costs to boost profits. But, you might not be sure how to go about doing that, or you might not have the time to spend brainstorming cost-cutting options.
Fortunately, helping businesses save money is one of the primary roles of an outsourced CFO. The vCFO can review your business practices and operations to identify money-saving opportunities. You might cut costs by changing suppliers or by streamlining your product line. In some cases, eliminating workforce redundancies is an ideal way to trim costs.
Deciding Your Business’ Future
There will come a time when every startup CEO needs to decide what’s next. For some, selling the company to a larger business is the best course of action. Others decide to acquire similar businesses or merge with other startups.
These aren’t decisions you need to make on your own. An outsourced CFO can help you make the right choice, whether it’s time to sell your business or acquire another one. They’ll guide the process, ensuring that your company’s best interests are protected.
If you’re feeling overwhelmed by the demands of running a startup, the team at New Direction Capital is here for you. Contact us today to learn more about how our virtual CFOs can help.