Startups nowadays have significant advantages over larger companies, especially with today’s fast-paced market. Small managements have a shorter decision-making delay, allowing them to react faster to market changes and address customer concerns.
However, the speed of their response to current situations isn’t enough to maintain a successful enterprise in the long term. Startups usually start with inexperienced business owners, which means they have limited access to the expansive reach that their larger competitors have. This is where outsourcing becomes a valuable asset to startups.
The issue with outsourcing
Not all startups have the capacity to do all of their business operations in house. This is why SaaS companies are excellent partners to have for a growing company. Teaming up with agencies that offer digital marketing and logistical services is one way of providing reliable service. The delegation of work to reliable firms makes it easier for you to focus on your business’s expansion.
However, a company’s growth can go out of hand when tasks and accounts have little to no tracking and accountability.
Working with multiple companies can make it risky to handle governance, quality control, and compliance with different logistical and legal policies. This is why businesses need to hire an experienced Chief Financial Officer (CFO) to keep track of their cash flow, financials, and business growth and expansion.
The role of CFOs in your business
Experienced CFOs can provide tremendous value to your business. Here are some examples below:
- A CFO manages the expenditures of your business and prevents costs from going overboard.
- They help a company sustain a positive net worth on your cash flow to avoid debt and maintain investments.
- Besides preparing for financial issues, outsourcing CFO services can help you deal with rough financial periods and create long-term plans for your company’s expansive growth.
Your business’s financial system scalability dictates whether your operations will achieve a particular goal to maintain your success. If you don’t have scalability in different sectors, you will have a hard time retaining the momentum of your success. This can be present in their accounting systems to human resources.
A CFO will help you plot out a long-term plan for your business’s scalability so that you won’t worry about reaching dead-ends with your company’s progression.
The three potential routes for your future
It’s common for startups to stay as a startup for a short time. If you’re running your business well, your private company will mature and overcome the obstacles along the way. This leaves you with three potential outcomes for the future of your enterprise.
The first option is that your company can upscale and compete with higher tier corporations through expansion. The second is that you become big enough to issue an IPO to further your growth. Lastly, the third option is to sell your company to be a part of a larger enterprise.
Each option has its pros and cons, but all of them will require the proper transition. As you move into one of these three directions, you will need to rearrange your business’s organizational structure.
A CFO will help you strategize and prepare for these events to not run into conflicts with merges.
Conclusion
It helps to have a veteran by your side when you’re growing your startup. Employing a CFO will guide your business’s direction with their years of experience in the industry as well as their technical and financial foresight.
Small business owners and entrepreneurs need to adapt to companies that offer virtual CFO services to adjust to modern times.
If you need CFO consulting services in Boston, we’re here to give you the help you need. Contact us today to see how we can grow your business.