Virtual CFOs have been a recent phenomenon, with many startups and small and medium-sized businesses (SMBs) looking for a CFO without the hefty price tag. But is going virtual better than hiring in-house? Is one really better than the other? The answer likely depends on your business and what you want out of your CFO.
We compare the two based on some of the main factors that come into play.
Finding an in-house CFO isn’t a quick interview away. It may require an extensive search to find a CFO who has prior experience working with your type of business. However, a virtual CFO (or vCFO, short) tends to have more experience in a variety of SMBs since they tend to work with more clients overall. Plus, they often work for companies that have other CFOs they can collaborate with to give you the best service.
When you hire an in-house CFO, you’re looking at paying a full-time salary, plus benefits and paid vacation time — a significant chunk of change for startups. Now, this may be cost-effective for you if you require a lot of work done every day and can factor in the cost of benefits, etc. On the other hand, you can find a full-time, part-time, or fractional CFO who only charges for the work they actually do for you — and don’t require any extras.
Plus, when you have an “employee” who doesn’t actually work in the office, you’ll save on overhead by not having to have a desk and/or office set up for them. Perhaps you only have a home office or small space to work in, so it’s beneficial for you to not have extra people on site.
Whenever you hire a new employee to work in-house with you and the rest of your staff, there’s always the question of “fit.” Will they fit in seamlessly into your office and work well with the rest of your employees? Company culture is an essential part of a working environment, but when you hire a virtual CFO, this is one less thing to worry about.
Communication & Training
Training a new employee generally means a lot of face-to-face time and being on-site to clarify anything as they need it. While this might be true, vCFOs have a lot of experience working with a variety of businesses, meaning they can slip into a position quickly. They also tend to have knowledge of different computer systems, formats, and reporting styles so they can adapt to the way your organization does things.
Any employee on-site is there to address any questions or solutions that crop up on the spot, but that isn’t to say that a virtual CFO won’t understand the importance of quick responses. Working on multiple projects means they’re excellent multitaskers, so they’ll know how to respond promptly.
We’re experts in the virtual sphere. If your startup is looking at hiring CFO services or a virtual controller for your business, contact us today. Our expertise and knowledge can help take your business to the next level of financial success.