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What is a Fractional CFO? The Cost-Effective Way to Bring on a Rock Star Chief Financial Officer from the RED Team
Contracting with a fractional CFO from InterimExecs RED Team is the cost-effective way for companies that don’t need or can’t yet afford a full-time Chief Financial Officer. A part-time or fractional CFO offers the expertise and guidance of an experienced Chief Financial Officer on a part-time basis. It’s the way to get a financial leader with a proven track record of success for far less than the cost of a full-time CFO.
And, unlike bringing on board a new full-time CFO, contracting a fractional CFO through InterimExes means there is no need to pay benefits, vacation, or severance. You are paying only for the exact type of expertise you need right now. Bringing on a fractional CFO is low risk. With our standard 30-day cancellation clause, you can scale up or scale back services as needed..
“We needed help because we grew beyond the capacity to understand our company’s financial statements. Our [fractional] CFO asked questions we would have never asked ourselves, so it turned out to be a great learning experience. I wish I had done something like this sooner.”
-Tom Glavin, Glavin Security Specialists
6 Times When Fractional CFO Help is the Right Answer
A bookkeeper, CPA, or controller managing the books and producing financial reports is perfectly adequate for small businesses. But, as an organization grows, financial system complexity increases. That’s when a fractional CFO offers the financial expertise the company needs.
Here are some signs that your organization may need outsourced CFO services:
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- More sophisticated reporting and KPIs are needed for sustainable growth.
- There is a lack of good forecasting for risk management and making sound business decisions.
- Books need to be closed out monthly, accurately, and on time.
- The company is starting to grow, acquire, or look for funding.
- Transactions are harder to navigate.
- Bankers are asking for routine reports and insight into business drivers.
- Bankers are asking for routine reports and insight into business drivers.
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The RED Team Advantage
InterimExecs RED Team is an elite team of interim and fractional executives who have been carefully selected from a pool of more than 7,000 candidates.
With incredible track records building, growing, and turning around for-profit and non-profit organizations, an experienced fractional CFO can be a strategic asset to drive your growth.
Outsource Your CFO Services
“The benefit of a fractional model is that the client or company doesn’t have to pay for a full-time CFO. The cost is a lot less and I focus my time and efforts only on the items that need my level of experience.”
Dave InterimExecs RED Team CFO
“A fractional CFO will come in, assess the situation, put a plan in place, execute the plan and then at a certain point either find a replacement for themselves or mentor the existing officers or VPs in the company.”
Yoav InterimExecs RED Team CFO
“If people need a little more sophistication in reporting and then suddenly management realizes that they don’t have the capabilities or skills in-house, or it is taking too much of their time to do…that’s the time to look for a fractional or interim CFO.”
Vic InterimExecs RED Team CFO
“Being a fractional CFO is challenging work. I love the flexibility, the variety, the continued growth, and the opportunity to meet so many great people!”
Shauna InterimExecs RED Team CFOThe On-Demand Path to Proven Leadership
The right fractional or part-time leader can be on-site solving problems for your organization in as little as 48 hours through our straightforward placement process.
Profile Evaluation
We conduct a thorough assessment of your organization’s unique challenges and objectives.
Executive Match
Our extensive network allows us to rapidly identify the ideal fractional or temp CFO your company needs.
Statement of Work
We collaborate with you to define clear goals, expectations, and deliverables.
Operational Roadmap
Your fractional CFO develops a strategic plan to address your organization’s needs and meet your financial goals.
Implementation
With a tailored roadmap in place, your fractional CFO leads your organization toward success.
Transitioning a company to the next generation can be beyond challenging. We have found that hiring a fractional CFO from InterimExecs RED Team has been critical in our transition process to make sure we have the appropriate expertise and at the same time can remain nimble.
-Beth Kraszewski, President, Purposeful Wealth Advisors
Fractional CFO Services Across Sectors
Backed by a vetted team of executives with diverse industry experience, our Rapid Executive Deployment™ Program (RED) ensures you are matched with a fractional CFO aligned with your organization’s mission and goals.
Software & Tech
Manufacturing
Business Services
Retail & Ecommerce
Healthcare & Hospital
Fractional CFO 101
What is a Fractional CFO?
A fractional CFO is an experienced Chief Financial Officer who provides C-level financial leadership services on a part-time or temporary basis. Organizations essentially rent out a portion of an experienced CFO’s time whether that is a few hours per week or several days.
The benefit of the fractional model: Organizations that are not quite ready for a full-time CFO can get high-level strategic CFO guidance for a fraction of the cost of hiring a full-time employee. The part-time CFO can empower and put the structure in place to allow the rest of the finance team — from controller to staff accountant to bookkeeper — to thrive.
If you believe your organization is at a size and scale to need a full-time CFO — a financial professional fully dedicated to one client at a time — you should consider contracting with an Interim CFO.
What Type of Executives Choose This Career Path?
A specialized group of finance professionals choose this career path. They are seeking flexibility and selectivity in the assignments they take on. They are financial experts with a knack for jumping into challenging situations. And they thrive on the challenges of growth or turnaround when systems, processes, and people need to be put in place to ensure a strong foundation.
What Are the Responsibilities of a Fractional CFO?
Cash Flow Management, Financial Planning & Analysis
Too many companies don’t have a good view into day-to-day cash flow. A fractional CFO will manage cash and liquidity, strengthen bank relationships, put together credible financial forecasts, ensure good budgeting, and utilize financial data to empower the executive team and the board to make strategic decisions.
Drive Profitability and Efficiency
A part-time CFO can provide valuable insights into the profitability of projects and initiatives. They will help implement KPIs (key performance indicators) to measure performance. And to ensure continued financial stability, an experienced RED Team fractional CFO will zero in on increasing operational efficiency while driving cost management strategies.
Financial Reporting
When a business has outgrown basic bookkeeping and Excel sheets, a fractional CFO can upgrade financial reporting so that data-informed decisions are at the center of an organization. Skilled at cost accounting, financial forecasting, cash flow analysis, and financial modeling, a part-time CFO from the RED Team will ensure accurate and timely financials.
Finance Technology Tools & Systems
From business intelligence and data analytics tools to ERP systems (Enterprise Resource Planning Systems), a fractional CFO can help select and implement technology systems and create the process and systems to help an organization get a better view into trends while ensuring accurate reporting and forecasts.
M&A – Mergers & Acquisitions
CFO consulting services can be beneficial in the case of M&A. A CFO can help identify and assess potential acquisition targets, or in the case of exit, a CFO experienced in selling businesses can work alongside the business owners or management team to ensure a successful outcome.
A temp CFO will lead the sale process, assess initial valuation, interface with investment bankers, oversee due diligence, and manage negotiations to transaction close. In some cases, a fractional CFO may stay on to help with post-acquisition integration.
Stakeholder Management
An experienced Chief Financial Officer interfaces with stakeholders of an organization whether investors, the board, auditors, or banks and lenders. They play a key role in presenting financial data along with a short-term and long-term financial strategy that includes risk assessment and the impact on financial performance.
Leadership & Team Development
A fractional CFO provides strong financial guidance, overseeing the finance department and mentoring team members across FP&A, accounting, and treasury. Serving in a part-time role, they may help train and mentor someone internally who can one day step into the full-time CFO role or help identify their replacement when the company is ready for a permanent CFO.
Financial Turnaround
A RED Team finance executive with experience in turnarounds can serve as a trusted leader and advisor in tense times. Whether that is streamlining operations, cutting costs, or making data-driven decisions to get the company back on track, expert turnaround professionals can hit the ground running.
The CFO jumped in eagerly, making sure the business continued to function smoothly, and then helped to efficiently manage the process of successfully selling the company. It was a great outcome and I thank InterimExecs for providing expert leadership fast.
-Dan Felix, Master Trustee
Welcome to Rapid Executive Deployment:
FAQs: How to Find the Right Fractional CFO
▶ Does your company specialize in Fractional CFO services?
▶ Are you a retained search firm?
▶ How much does a fractional CFO cost?
▶ How do you get paid for your CFO search services?
▶ What’s the difference between a fractional CFO and consulting CFO?
▶ How long is a typical fractional CFO services assignment?
▶ How are contracts with a part-time or fractional CFO structured?
▶ Is my CFO in-person or virtual?
Does your company specialize in fractional CFOs?
Everything we do is focused on fractional, interim, or project based executives across the C-suite. We are usually called in when:
> transition is taking place – a CFO retired, resigned, or is fired;
> growth is on the horizon and systems need to be put into place; or
> the team needs accountability and some additional expertise to overcome financial challenges but the company isn’t ready to hire a full-time CFO.
We have screened thousands of executives to hand-pick the best of the best CFOs from around the globe.
Are you a retained search firm?
We don’t take retainers and we are not a traditional recruiter who will throw hundreds of resumes at you. In as little as 48 hours from an initial briefing, we will present you with trusted CFOs from our RED Team who could be a good fit for your needs and then take you through our propriety process to find the best fit.
How much does a fractional CFO cost?
Most fractional CFOs charge by the hour or charge a fixed monthly fee (i.e. $X/month to dedicate 50% of their time). Rates vary by background, experience, length of assignment, and other factors. This is not the same thing as permanent employment though. No severance. No benefits. No paid vacation. You are paying for the exact type of expertise, you need right now.
How do you get paid for your CFO search services?
InterimExecs acts as agent to executives. We will work with you to create a statement of work and rate schedule that includes an executive’s fee with a markup included to cover our services.
What’s the difference between a fractional CFO and a consulting CFO?
Fractional and interim CFOs are true financial professionals who have decision-making responsibility within an organization. They have P&L responsibilities, embed within the team to provide leadership, financial management, and accountability, and they have the authority to hire and fire (on terms agreed upon with the owner, investor, executive team, or board). A consulting CFO is another title often given to part-time CFOs, but the best part-time CFOs don’t just provide advice; they get their hands dirty and hold themselves and the team accountable for results.
How long is a typical fractional CFO services assignment?
A fractional CFO might work a few days a week or a few hours a day over the course of several years, or they might be brought on board for a few months on a project basis to oversee fundraising efforts or to implement a new financial approach. It all depends on the needs of your organization.
With a RED Team fractional executive, contracts are flexible: no severance, no benefits, and an easy time scaling up or down CFO services. Once you reach a size or scale where a full-time CFO is needed, your fractional CFO can help identify and onboard their permanent replacement while ensuring a seamless transition.
How are contracts with a part-time or fractional CFO structured?
RED Team executives are deployed through InterimExecs’ placement arm. Under our business model, there is never an employee/employer relationship created and the assignment is focused on specific deliverables and results.
Bringing on a fractional CFO is low risk. With our standard 30-day cancellation clause, you can scale up or scale back services as needed.
We stand for happy executives, happy clients.
Is my CFO in-person or virtual?
Whether a fractional CFO is in-person or virtual depends on the client’s needs. Some executives are local or travel to the assignment, some have a hybrid setup, and others are virtual.
Virtual CFO services are especially beneficial to organizations that want a top quality CFO with a specific skillset or background. A virtual CFO model also provides a lot of flexibility while still delivering on projects. While a virtual CFO may not always be on the clock from a set time, a client can text or call and and a virtual CFO will get back to them promptly.
