Introduction

Compared with their larger rivals, small and medium-size businesses (SMEs) have a whole host of advantages. They are nimbler, can quickly launch experiments, and can more easily build strong corporate cultures. But for all the advantages that SMEs have, they also have to cope with some weaknesses.

 

Some of the most glaring weaknesses are cash constraints and lack of experienced human capital. Combing these weaknesses can make it difficult to do everything from manage working capital to raising a seed or series A or B round.

 

Most SME founders try to work through these challenges. They spend countless hours making up for these weaknesses, even though they are busy with the other aspects of running their businesses. But even after doing this, they often discover that they aren’t completely satisfied with the results.

 

This is where Portfolio CFOs can provide a wealth of value. Portfolio CFOs provide the twin benefits of experienced and steady hands, all at a lower overall cost than bringing on a permanent CFO. In other words, it is like owning one-fourth of a £100,000 Ferrari versus a £25,000 Mazda outright.

 

 

Creating Mutual Value

Hiring a Portfolio CFO is a win-win for both the SME and the Portfolio CFO. The SME gets a cost-effective and experienced CFO while the Portfolio CFO gets flexibility and entrepreneurial work engagements.

 

From the SME side, hiring a Portfolio CFO is both cost-effective and accretive to the business. One of the best parts of Portfolio CFOs for businesses is that they are available on-demand. The total costs are a function of the service that the SME needs. While costs are typically front-loaded, lower maintenance costs can be expected on an as-needed basis. In exchange, the SME can leverage the Portfolio CFO’s financial expertise to overcome a wide range of financial challenges, including raising outside capital, helping the company navigate an audit, and reducing high expenses.

 

But beyond handling these critical tasks, the Portfolio CFO can contribute an intangible asset to your business — experience and new ideas. Typical qualifications for CFO roles include a minimum of eight years of experience in a senior role, a master’s degree in accounting, finance, or business, a Charted Accountant designation, and up-to-date knowledge of current financial and accounting ERP systems. The Portfolio CFO should have the technical chops to shepherd your business through a wide variety of obstacles.

 

Flexible

But moreover, they likely have experience in other sectors. While this may not seem immediately obvious, these experiences can help generate new ideas to make your business grow. New ideas emerge from the collision of seemingly disparate notions or experiences, meaning that a diverse team with varying experiences can make this job much easier. Ultimately, it can open your eyes to a new way of doing business.

 

On the Portfolio CFO’s side, they can take advantage of the opportunity to work with different clients. The varied engagements can not only improve their financial skills but can expose them to young and scrappy SMEs that are looking to change the world. For CFOs who are looking for new challenges and the opportunity to work for growing enterprises, a Portfolio CFO role may be the perfect fit.

 

Granted, the Portfolio CFO role isn’t for everyone. A good number of CFOs are looking for continuity or enjoy working for their current company. But those that choose the Portfolio CFO path can embrace an entrepreneurial lifestyle, experience different challenges in a variety of sectors and industries, and create real value for their SME clients. Being a Portfolio CFO can be extremely rewarding, both on a personal level and a professional level.

 

For many SMEs, the trade-off is quite clear. Portfolio CFOs let them hire qualified financial operators at a fraction of their normal cost. Moreover, SME owners recognize that a fraction of a qualified CFO is better than 100% of an under-qualified accountant or bookkeeper.

 

Trusted

Essentially, the Portfolio CFO can be a trusted ally as an SME is encountering growth challenges. Whether the SME owner needs help with reducing expenses or preparing the company for a capital raise, a Portfolio CFO can apply his or her expertise to get the job done. Better yet, SME owners can hire a Portfolio CFO based on their own needs and budget.

 

Speak to us about hiring one of our Experienced Portfolio CFOs.

Tel: +44 203 286 8700