"I Hired a Fractional CFO and It Was a Total Waste of Money,"

"I Hired a Part-Time CFO and It Was a Huge Waste of Money"
Said just about every CEO we talk with...

Have you ever said this?

Have you ever hired a fractional CFO, only to be left feeling like you just paid a premium for bookkeeping services?

If you have, you're not alone.

We've heard it from almost every CEO we've talked to in the past 10 years.

But here's the thing - it's not really your fault. And it's not entirely the CFO's fault either, although often falls on the fractional CFO themselves.

The real problem?

The truth is, the problem usually stems from a fundamental misalignment of expectations. You and your CFO probably had very different ideas about what they were supposed to do.

Asking the Wrong Questions

Imagine needing surgery. You wouldn't ask your surgeon, "Can you grab my insurance card?"  

That would be ridiculous, right?

The same goes for your CFO.  When hiring a CFO, I think most people carry the assumed questions along the line of:

• Are my books correct?
• Can I complete my taxes and not pay a fortune?
• How much money do I need to run my business?
• Am I making the most profit I can?

These are good questions.

But they're not the biggest problems keeping you up at night, are they? Nor are they the ones that make hiring a CFO a valuable investment.

These kinds of questions you can ask a much junior person.

The Questions That Really Bother You

The real value lies in questions like:

• Why do we make a couple of million in revenue and yet every pay period I worry that we aren't going to meet payroll?
• Why do I feel like I am overpaying this employee and yet I am not sure?
• I suspect that my marketing isn't working or at least profitable, how do i know for sure?
• I feel like we should be much more profitable than we are, but how come we never have any excess cash?
• I want to launch this new product line, or service, do I have the financial resources to be successful with it?
• If not, how can I get the money to successfully launch?
• What does a successful launch even look like?
• I think the ideas would be profitable, but can I project today how much?
• How do I answer the question of is the juice worth the squeeze?
• How can I make big decisions that will change the course of the company and know with great confidence if they are the right decisions?
• Do we have enough revenue to hire a new xyz employee?

These are the questions that matter.

These are the real problems that need solved by your C Level team.

As i write this, it almost feels like it is more of an oracle type position.

Someone who has the ability to use their magic to look into the future and be able to guide you on making the best decisions for your company - based on numbers, true input and outputs, rather than just guessing.

That is really what your Chief Financial Officer should be able to do for you.

Someone who can put together financial models that you can manipulate.

For example, say bringing on that new vendor.

When you go to make this decision, you have to know is how this going to affect my business from a cash flow standpoint - next year, two years, five years?

What other areas is this decision going to touch? Employees, management, production?

You have to have someone that can take a simple decision like that and be able to lay out for you all the little ripples that will result from it.

These are the kinds of questions that are more than valuable to a CEO. 

They are indispensable.

At a minimum your fractional CFO should be able to:

• Build dynamic financial models that allow you to see the future (well, sort of). Imagine a scenario where a particular decision requires a significant upfront investment. Your CFO should be able to model the impact on your cash flow for years to come.
• Speak your language. Even the most financially astute CEO might not be a walking encyclopedia of accounting jargon. A good CFO can break down complex concepts into actionable insights.
• Collaborate across departments. True financial leadership goes beyond the finance team. Your CFO should work with operations, HR, sales, and marketing to ensure everyone's decisions are aligned with your financial goals.

Why Your Fractional CFO Didn't Help

Most part-time CFOs are good with numbers. They can tell you what happened last month or last year. But that's not what you really need.

You need someone who can look at your whole business and help you see what's coming next. Someone who can work with your sales team, your marketing people, and your operations folks to make everything run better.

It's Not (All) Your Fault

If you hired a fractional CFO and felt let down, don't beat yourself up. Lots of CEOs have trouble explaining exactly what they need. You might have had big hopes without realizing it.

What You Really Need in a CFO

A great CFO should:

• Make complex money stuff easy to understand - for everyone.
• Work well with all parts of your business. They must be completely integrated into the business.
• Know what makes businesses like yours profitable, where are your cash leaks?
• Help you test out "what if" scenarios.
• Make you feel like you can make big decisions with 99% confidence - because you have the data and experience on your side.

With a CFO like this, you'd feel much more sure about where your business is going.

Wouldn't you?

The Big Picture

Next time you hear a CEO complain about wasting money on a part-time CFO, you'll know what's really going on. It's not that part-time CFOs are bad. It's that often, nobody was clear about what they were supposed to do.

The roles, nor the responsibilities were not defined.

So, think about your business.

Do you have someone you trust to help you with the big money questions?

An oracle, for business.

Someone who can help you figure out what to ask, understand the answers, and use them to make your business better?

That's what a real CFO does. And that's what we do.

Want to talk about it?

Call me at (844) 413-6287

Or you can keep guessing and hoping.

It's up to you.