The figure of the CFO is key for the operation of any company. Even more so when it is in its early stages, as is the case of startups.
If you are not very clear about the functions, skills or competencies of this profile, keep reading because in this article we will explain everything.
But before we start, let’s define this position…
What is a CFO?
The CFO (Chief Financial Officer) is a person who is in charge of the financial planning of a company.
He or she is in charge of supervising investments and monitoring the achievement of economic objectives in order to increase the value of the company, playing a crucial role in the management of finances, especially in the early stages.
The challenges faced by the CFO in a startup are unique, from managing limited financial resources and seeking new investors to having to adapt quickly to market changes.
That’s why the CFO of a startup must be a skilled leader who can make the right strategic decisions to drive the company’s growth and success.
Functions of the CFO of a startup
As we have already mentioned, a CFO is responsible for the financial health of the company. Therefore, when we talk about startups, the importance of their functions is magnified as they can mean the growth or end of this emerging company.
Let’s see what each of its functions is:
Analyzing the economic situation of a startup
The CFO is a key player in the economic future of startups. He is able to identify and minimize risks, report metrics, and identify and communicate which areas of the company are more or less efficient within the startup. To then propose how to get the most out of that information from the financial area.
Contributing to the business strategy to scale your business
The figure of CFO, whether external or internal, is part of the management team and is in a position to advise through a financial prism the strategic decisions of the emerging company. Achieving improvements and innovations that can translate into added value. Something decisive when we want our new company to have a future in the market.
Managing financial communication
Another of his functions is to maintain good communication with the entire team. For this reason, he prepares and presents rigorous and timely reports on the history of financial information. All stakeholders (shareholders, analysts, creditors, employees or board members) depend on the accuracy and timeliness of this information. Fulfilling this function helps these stakeholders who may be affected by the company’s decisions increase their commitment and confidence in the startup’s future.
Fundraising
Finally, fundraising and seeking funding are vital for any startup. CFOs are responsible for analyzing all possibilities, from public funds, bank loans, or venture capital funds, to private investors. And they draw up a high-quality business plan to raise the financial resources needed to propel startups forward.
At this point, you will have realized that CFOs do not just report numbers, but are people with vision and initiative who are able to enhance the value and growth of startups.
Many startups do not have a CFO to play this key role in the strategic and financial development of their companies. If this is your case, at The Startup CFO we can help your project achieve its goals. We specialize in the financial and strategic management of fast-growing technology startups.
If you would like to learn more about the services we offer, do not hesitate to contact our team of professionals, we will be happy to help you!
