Question 1

Financial projections (of cash, revenue, expenses and profit)

Accepted Answer

Every startup needs financial projections to be able to set itself targets, manage cash burn and show its revenue potential in order to attract new investors.

Through financial projections, you will: 
Get a complete picture of your revenue and expenses projections
Ensure you have healthy cash flows (and identify issues and opportunities)
Understand how expenses will increase as your business grows
Get reliable data to help you plan the expansion of your team and drive growth

Question 2

Scenario modeling

Accepted Answer

Scenario analysis will show how your company is likely to perform under multiple circumstances. This could be if you ramp up/down your marketing spend, freeze or ramp up hiring, do one big fundraise or plan for several smaller ones, or any number of scenarios.

The main purpose of scenario modeling is to inform your strategic planning and help you make informed decisions in the running of your company.

Question 3

Budgeting

Accepted Answer

When setting budgets, it’s important to balance your cash flow and burn rate with your growth and profitability targets. By providing a deep understanding of the company’s financial situation, valuable insights and recommendations based on their financial and strategic expertise, a Fractional CFO can help establish realistic and achievable budgets.

Question 4

Budget vs. actual financial data comparison

Accepted Answer

To make sure that your business is hitting the desired milestones, your CFO will regularly compare your actual financial data with your budget, creating information that is digestible and actionable for non-financial people. As a result, you will have a periodic diagnosis of your financial performance to help you adjust your strategy and budget accordingly. This can help you stay on track with your objectives, and make informed decisions about resource allocation.

Question 5

Unit economics and KPIs

Accepted Answer

KPIs and Unit Economics are essential to any business’s financials because they measure your team and company's performance. Establishing and tracking these can be easier with an outsourced CFO. This analysis can help you to:
Understand how sustainable your business is
Get insights and make data-driven decisions to boost revenue

Question 6

Financial presentations & reporting

Accepted Answer

Your leadership should be 100% aligned regarding your company’s financial situation. That’s why board meetings often cover:
Your annual budget 
Fundraising opportunities
Financial projections
Financial models
This information will get more complex as your business grows. And here is where an outsourced CFO can help. Should you require it, a fractional CFO will:
Attend board meetings
Lead financial discussions
Turn figures into actionable advice
Answer financial questions with a combination of technical knowledge and clarity

Question 7

Strategic planning

Accepted Answer

A market strategy is essential to any company. A fractional CFO can help create a market strategy by providing revenue forecasts, analyzing market trends, developing pricing strategies, and developing financial models to ensure your business is financially viable (if it isn’t, they can advise you on ways to optimize it). Additionally, should it be needed, a fractional CFO can help identify potential funding sources to support the market strategy.

Question 8

Risk management

Accepted Answer

All businesses have risks and uncertainties, and a Fractional CFO can help you understand, prioritize, manage and mitigate them to ensure financial stability. For startups and small businesses, this can often be related to your:
Cash flow, debts or funding
Consumer demand, new competition, or economic downturns
Regulatory compliance or intellectual property issues
Employee turnover, succession planning or recruitment of skilled employees

Case Studies