Five ways to grow your business with a Virtual CFO

March 5, 2022by Kelly Morgan0

There are very few business owners who wouldn’t welcome expert financial advice and financial help if it was available, as good financial advice and financial management are keys to success for any business, small or large.

The difficulty for most small businesses, entrepreneurs and new start-ups is that it is prohibitively expensive to recruit a full time chief financial officer (CFO) with significant experience and expertise, so they tend to soldier on relying on their own knowledge or the knowledge of their employees. However, there is an affordable way to obtain the top-level financial advice, expertise and experience needed for growth and financial success and that is by engaging virtual CFO services.

There are five compelling reasons for engaging Virtual CFO Services:

1. Financial Reporting

The company bookkeeper or Finance team can and will prepare reports for a business owner but to receive advice, insight, help and to be able to share the knowledge that an experienced CEO can bring to the table with accurate and insightful reporting, is hugely valuable.

Not only will a Virtual CFO provide information that will build the decision-making confidence of the business owner but will inspire collective confidence across the whole business and its stakeholders. Quality and insightful reporting and report preparation by an experienced virtual CFO will also inspire confidence amongst investors and the company’s bank or banks.

2. Analysis and Decision making

Analysis and Decision making – A Virtual CFO will analyse a business to give its owner or senior management all the information necessary to make informed strategic decisions. The businesses’ financial health, its opportunity for growth and long-term profitability, what risks does the business face and how and when might they come into play.

Once a virtual CFO is able to analyse all the necessary information, they will be able to formulate a workable and realistic business plan with the business owner or managers, that will be robust and be a working document for the business to measure its progress towards its financial and business goals.

3. Investment

Whatever growth plans a business may have; it is likely that at some point they will need to raise money to pay for that growth. Whether it be expansion of the product range, more staff, new premises, more infrastructure or even the acquisition of another business. Raising money can be difficult for small businesses, as the number of options available are numerous and there are a number of pitfalls that businesses can fall into, if they make wrong decision on how they raise capital. There is also the actual process of raising money and pitching to banks or possible investors a compelling business plan that will attract investment. This is a complex process and one which requires experience and expertise. A virtual CFO will have been through this process on numerous occasions, so will be able to advise a business on the best route for raising capital and help put the financial pitch together and help the business owner work out what they are going to give away in terms of share capital in return for the money raised or how the investment repayment will be structured. There are many details involved in capital raising and a virtual CFO will help ensure the business owner has a much easier journey through the process.

4. Managing Risk

All businesses face multiple risks to their business, whether it be from failure to comply with regulatory requirements, natural disasters, technology-based sabotage and cyber-attacks or employee theft and misbehaviour, to name a few. There are multiple threats and risks business owners need to plan for and often don’t see coming. A virtual CFO will be able to assess all the risks the business faces and draw up a plan to ensure that the business will be able to overcome likely problems. This may involve, increasing or changing insurance policies for natural disaster, employee illness and public and employee liability. More efficient back-up systems are purchased and put in place to ensure that all data is adequately stored and saved. More defence against cyber-attacks and threats and a higher level of maintenance of all company machinery. The virtual CFO will also look at disaster planning and come up with systems for when things do go wrong and what can be done to mitigate the potential damage the business will suffer. That is often coupled with the insurance review and increasing coverage and valuations of what is insured. An experienced virtual CFO will look at the risks facing a business, as a matter of course, which is something business owners might never think about as they are so busy running the business day-to-day.

5. Managing Change

For a business to grow and expand it needs to be in a constant state of change. Change and growth often result in businesses taking their eye of the financial performance and concentrate exclusively on new products, new areas of business, new technologies and other major growth impactors. A virtual CFO can analyse and manage the financial performance of the business while the business owner or the senior management concentrate on the core activities of the organisation. This ensures ongoing control of the businesses’ financial position and performance. The virtual CFO can guide a business owner through periods of significant change and business transition and help the organisation reach the growth goals it has set itself and at the same time keep the business focused on all the activities it needs to do to be compliant, secure and profitable.

Kelly Morgan

CFO Australia’s Lead Advisor with over 32 years’ experience as a Chartered Accountant, CFO and Board Advisor across multiple businesses. Kelly is inspired to connect with people each day and influence their success.

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