For smaller venture capital (VC) and private equity (PE) firms, success comes down to efficiency. It’s about maximizing resources, keeping operations smooth, and staying focused on the main goal: making intelligent investments. One strategy that’s becoming increasingly popular is outsourcing CFO services, also known as hiring a fractional CFO. This approach gives your firm access to high-level financial expertise without the cost and commitment of a full-time hire.
In this article, I’ll break down why more firms are turning to outsourced CFOs. We’ll cover the big benefits like cost savings, access to specialized expertise, and keeping your team focused on what matters most.
1. Cut Costs Without Cutting Corners
For smaller VC and PE firms, carefully managing expenses is critical. Every dollar saved is a dollar that can be reinvested.
Hiring a full-time CFO can get expensive quickly. The median salary for a full-time CFO in the United States is currently over $400,000 per year. And, of course, it’s not just about the salary. Benefits, bonuses, and other perks add up too.
Outsourcing to a fractional CFO provides your firm with access to top-tier financial expertise on an as-needed basis. You only pay for the specific expertise you need—from a few hours a week for ongoing oversight to more intensive support during a critical financial event. For example, a fractional CFO can step in to provide strategic advice during a capital raise or help restructure a portfolio company’s financial model for better scalability. This flexibility helps you direct your capital toward high-potential investments that drive growth.
2. Get the Right Expertise When You Need It
The VC and PE world is inherently complex. Smaller firms often don’t have the budget or capacity to hire a full-time CFO with deep, specialized experience. This is an area where a fractional CFO can be a game-changer.
By tapping into outsourced CFO services, your firm can gain access to seasoned professionals with years of experience in VC, PE, and startup environments—often in the exact sectors and markets you’re investing in.
Burkland CFOs provide comprehensive financial management and strategic guidance across both operational and investment functions. On the management side, we handle financial preparations including budgeting, forecasting, and cost management, while also advising on headcount, contracts, audits, HR, governance, and more. Our expertise extends to marketing, investor relations, compliance, and invoicing.
For the investment side, Burkland CFOs manage fund administration with a focus on detailed investor reporting, tax compliance, and optimizing cash management and internal rate of return (IRR). We oversee the entire fund lifecycle—from capital calls to distributions—and provide vendor risk management, KYC/AML compliance coordination, and audit oversight.
3. Stay Focused on What Really Matters
Staying focused on core activities is crucial for smaller VC and PE firms. You need to concentrate on finding great investment opportunities and nurturing portfolio companies. But handling financial operations, compliance, and reporting can eat up a lot of time and attention.
Outsourcing these financial tasks to a fractional CFO frees up valuable time and resources. It allows partners and key decision-makers to focus on what they do best—deal flow, portfolio management, and building investor relationships. With an experienced CFO managing the financial details, firms can keep their focus on strategic growth and success.
4. Make Informed Investments with Due Diligence
Beyond financial management, VC and PE firms face another challenge—conducting thorough due diligence on potential investments to ensure alignment with their strategic goals and minimize risks. By partnering with a fractional CFO to conduct comprehensive due diligence, firms can make more informed investment decisions and better safeguard their portfolios against unforeseen challenges.
For smaller VC and PE firms, outsourced CFO services are a smart way to manage finances more effectively and stay focused on the big picture. Learn more about our suite of services for investors, and contact us for more information.