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An ex CFO of a multinational corporation is the best hire for a start up. Making that sort of strategic hire is the easiest and most affordable way to fast track a start up through its growth phase to achieving the maximum value at exit.
Our experience is that founders of growing businesses are very clued up on the fact that they need expert help to grow the company and we’re seeing a real appetite for the part-time Finance Director role.
Benefits of a CFO
Hiring a CFO is probably a small company’s most critical hire. Numitas has a wide network of relationships with banks and investors and, anecdotally, a number of these are saying that they see significant improvements not just in bottom line profits but in growth strategy, forward planning and recruitment once the company hires a CFO.
Our CFOs all come out of big corporations and what we see is that the big company experience down-scaled to our typical client’s size really works to unlock the potential for our client. One of the key benefits is that experience at a blue-chip company gives a CFO real credibility and having someone like that on your team has a real impact on the way financiers and professional advisers see your company. Founders of SMEs often do not have strong relationships with professional advisers and financiers that are needed to unlock the maximum potential of a company. An experienced CFO can open those doors.
The other key benefit is around risk management and upscaling. Big corporations are very good at implementing control and discipline and that experience is very useful for an SME. A CFO from a big corporation will look at process from day 1 so that as the SME grows it is easy to scale up the processes. What we see with companies who wait a bit too long to hire an expert is that they really struggle with the transition from start up to AIM listed.
Planning for growth
As the SME grows, it will encounter problems and pitfalls that will be new issues for the founder but are likely to be issues that a blue-chip CFO has encountered many times in the past and will know the fastest and most effective way to resolve them.
One of the most important skills of a high-quality CFO is that they will spend the time planning and identifying the issues that need tackling early on. They know that lawyers and accountants need to get involved at the right stage, before a problem becomes intractable and there is very little they can contribute. Another factor is that as most of our CFOs have worked on complex contractual issues in their previous lives they can offer a CEO of a smaller firm a level of contractual advice that enables the firm to make the best use of the professional adviser time they are being billed for.
Rolling your sleeves up
While a blue-chip CFO can bring many benefits to a firm, it’s important to find one that will work well in an entrepreneurial environment.
SMEs need to know that a CFO will be able to adapt to a small business environment. CFOs wishing to move to an SME need to show genuine interest in working for a small company and relish the excitement of such a position.
An entrepreneur needs a CFO who can roll up their sleeves and wants to delve into the details. The right CFO will know the differences between managing a large and a small business, such as the importance of effective cash flow management and be aware of tax breaks and government initiatives that can benefit the company.
The right CFO will relish the opportunity to build relationships with all the department heads at the SME. They’ll be able to communicate their ideas clearly, even to those who do not have a finance background.
At Numitas, we make sure the fit is right and the CFO works with the client to make sure the strategy is right. It’s a win-win situation. For more information about engaging a part time CFO for your business, contact us info@numitas.com or phone 020 7717 5254.
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