Growing a business or a startup takes a lot of effort. You need to account for numerous factors. If you have recently embarked on this journey, you will be fully aware of the amount of attention required to get everything up and running. A recent study by Failory discovered that the failure rate among startups is nearly 90 percent.
That's why procuring the proper guidance from the start is crucial for the success of the venture. Hiring virtual CFO services can go a long way in ensuring your business has the best chance of succeeding.
If you are still unconvinced, here are five reasons why hiring a virtual CFO is good for your business.
New businesses and startups aim to grow fast. If you have a rapid growth rate or are planning to implement plans for rapid transformation and growth, it might be a good idea to get additional expert help in the form of a virtual CFO.
They have the expertise to assess your business and develop an actionable blueprint to grow at the pace you desire.
Need for Increased Cash Flow
If you compare your enterprise to a beating heart, then its cash flow would be its lifeblood. You have to be aware of the level of cash flow in your company to avoid certain risks. There are many enterprises that, despite having good products in the market, run into financial trouble owing to a lack of proper cash flow analysis.
Using virtual CFO services, you can identify areas in your business that require improvement. A CFO can chart out a clear cash infusion strategy that can revive these areas. The CFO can also place a monetary mechanism that can help you avoid similar cases in the future.
Connect with Investors
Most virtual CFOs are experienced professionals who have been working in the industry for many years. They will be privy to information on potential investors who may be interested in infusing your startup or business with adequate capital.
The involvement of a capable CFO can attract external stakeholders by increasing their confidence in your venture.
Two of the biggest reasons most startups fail to succeed are misreading the market demand for the product or service and inadequate funding.
Some studies suggest almost 58 percent of startups begin their entrepreneurial journey with less than $25,000 at their disposal. A CFO can help manage the funds at your disposal better.
Bird’s Eye View
Building up a startup is like jumping into a vortex; there are hundreds of things vying for your attention at the same time. Sometimes it becomes pretty hard to keep track of the overall direction the organization is taking.
A virtual CFO can help you stay on track at all times. They can also provide you with clear, objective, and unbiased feedback that can help you grow. They can also be excellent guides and confidence boosters when needed.
Auditing and Tax Expertise
Taxes and audits can be complicated subjects if you've just begun your journey. As your organization grows, things will only get more complex.
At the end of the term, you may find your financial statements riddled with errors, requiring multiple corrections. Not to mention, making mistakes in filing tax returns can result in hefty business penalties.
If you are unsure, you should get in touch with a virtual CFO. They can help you with filling tax forms and complying with correct auditing requirements.
With the right resources, there's no limit to what you can achieve. Set targets and empower yourself with the right tools to forge your unique path towards success.