I'm currently an Outsourced Controller for 2 small companies. I want to get into doing Consulting
Consulting CFO
Answers
My advice to you would be to talk to some business owners of the size companies you are looking to get into or talk to some PE groups that specialize in the industry you are looking at. Do you have CFO experience in that size of company? In that industry? If not, why would they hire you? You should be prepared to answer that question. The step between a controller and CFO is larger than most people think. The role is very different. Best of luck.
For me, the transition from part-time Controller to part-time CFO was gradual over time. I can't think of a client where I was part-time controller where there was also a CFO. So, CFO-type things came to me in the natural flow of things and perhaps you're already finding that to be the case, too. If you want to make a quicker transition, I'd suggest having someone at each client who can take on the more routine
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Well stated Bob.
The short answer to your question: "What does a $5-$20 mill company expect..." A strategic view. be it processes, budget, systems, legal, contractual, customer or vendor centric. The ability to transform that 10,000' foot view into tactical plans. The ability to see that those plans get implemented.
There are several firms that provide
Very difficult to move even from a full time CFO to a Virtual CFO. The majority of mid sized companies while they need a good strategic thinker they don't want to have someone like this. Only the enlightened few do. I have never found the organisations who provide marketing support for Virtual CFOs any good.
Bob above is right that it takes a long period of transition
Thanks for the responses. So the response from "Anonymous(Managing Principal)" is addressing one of my biggest concerns and something I didn't even ask about. Lots of people (ones selling Virtual CFO tools) talking about how there's a huge number of businesses who need Virtual CFO help. And I agree.
But I know enough about marketing to understand that just because they need it, doesn't mean they KNOW they need it, let alone want it.
If I had a
I think your biggest focus should be on networking to find the right opportunities. The best CFO consulting opportunities are the ones with founders of small to mid-sized companies that are hitting their growth pain points and need the strategic and sound finance advice of a virtual CFO. Of course industry experience goes a long way but I've found that networking to find the right owners looking for help is the way to go. Then you can sell on the relevant experience you have to see if it's the right fit.
Providing a complete answer depends on your skills, abilities, and confidence levels.
Early in my CFO business career, I was controllership-centric. I still have a few of those clients as the work is heavy on FP&A, but light on all other areas of the business. You should be able to easily fit 8-12 clients a month in your schedule.
What does that look like? Presumably (I don't know your current workflow), you'd quarterback but not do the month-end closing work. Every client should be closing in 3-5 business days.
You should then be scrutinizing the financials afterwards and then updating your driver-based financial model comparing actual to plan. And I'm assuming you'd be doing some rolling forecasts over a 6-, 9-, or 12-month time period. Get a tool like Quantrix to do this. Excel is fine, but as you get better, you'll be pulling your hair out for everything Excel can't do well.
You would probably and should own the banking relationship--packaging new loan requests and managing and negotiating the LOC renewal annually.
You should be the key expert in risk management and overseeing the marketing of existing insurance coverages and limits every 3 years and ID'ing where exposures exist for potential losses that should be transferred.
Bi-annually at a minimum, you would be working with the owner to update any investment plans for CapEx or other significant changes to the workforce.
While you don't do taxes, you'd be updating the tax projections for the owners so there are no surprises each April 15.
The above is if you are controller-centric.
Being CFO-centric means being involved in marketing, sales management, operations, and customer support. I have clients that have controllers, and 2 even have CFOs. So in these cases, I truly am a CFO as I was in my W-2 years. I still charge a monthly retainer to these clients, and I meet with the owner at least once per month. I'm available on-demand at all times.
Accordingly, you'll be the one that figures this out over time. I did. I also grew bored of the controller-centric model looking for/seeking greater challenges. Your business will evolve as you do in skills, capabilities, and confidence.
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