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The Smarter Startup

Getting Maximum Value from Your Fractional CFO

Marc Zablatsky and Steven Lord share guidelines and tips to help your startup receive the most value from your fractional CFO investment.

By Marc Zablatsky and Steven Lord


Hiring your fractional CFO is a significant milestone for your startup. Properly utilized, your CFO can help you reach goals faster by providing strategic financial guidance, tactical finance, and accounting support as you scale.

Helping hundreds of startups across many sectors, our fractional CFO team knows how a startup can receive the maximum value from working with a CFO. We’ve outlined some guidelines, tips, and best practices to help your startup get the most from your investment.

1. Roles & Responsibilities

Who is your Head of Finance (HoF)?

Did you know when working with your new fractional CFO, one of the first things to do is determine who will be the Head of Finance (HoF)—the person in charge of finance—at the company?

Will your fractional CFO be purely strategic, focused on big-picture matters, or do you also want the tactical day-to-day accounting and finance tasks and responsibilities off your plate so you can focus on scaling the business?

It matters, because someone has to be the HoF, even in the smallest startups, in order to build a proper, value-producing finance function at your company.

The HoF role starts with setting core accounting priorities for the business and setting a regular cadence for monthly close meetings and communications with accounting team members, the executive team, the founder / CEO, and Board (just like a full-time CFO).

From there, the role expands to include a number of additional responsibilities:

  • Managing the Finance and Accounting teams, including direct reports (internal and external), and deliverables
  • Ensuring your Chart of Accounts meets your business needs and requirements
  • Overseeing Tax and Compliance
  • Reviewing the monthly financials for misclassifications and other errors
  • Establishing and improving finance processes, including new technology
  • Creating and maintaining the Finance department’s organizational chart so responsibilities are clear
  • Modeling for future needs of the business and department as the company scales
  • Preparing accurate financial information for the Board, and becoming a resource for them regarding finance-related questions
  • Selecting, tracking and circulating key metrics, and getting input on them from other team members

The HoF handles everything accounting and finance-related for your startup. This frees your time and mindspace to focus on building products and growing the business. Managing the finance team and keeping the books squared away are obvious, but this role also improves back office processes, adds technology to your finance stack, makes your money in/out processes more efficient, and generates the metrics you and your team need to make decisions.

If your fractional CFO is not your Head of Finance, who is?

If you’re working with a Burkland CFO, they can assume these responsibilities along with their strategic financial role. Importantly, it is critical to clearly delineate who is responsible for which roles and responsibilities to ensure everything is covered.

If you are not the HoF, someone needs to be…and if no one is, two things will happen:

  1. First, the finance function of the business will have major gaps which will grow larger over time.
  2. And secondly, errors, bad habits and missed opportunities will accumulate – costing you and the company significant time and money down the road.

If you decide your fractional CFO will be your Head of Finance, let your organization know just like you would with any new addition to your management team. This makes it easier for both your organization and your fractional CFO to access the information and people they need to do their jobs effectively and efficiently.

2. Projects & Priorities

Once you have decided on the role and responsibilities of your new fractional CFO, focus should turn to initial projects and priorities. What do you want to accomplish over the next quarter and even the next year?

After you have answered these questions and have a list of projects, prioritize them into a finance and accounting action plan / project tracker. We suggest referring back to this and updating each time you have a meeting with your fractional CFO. You can be the keeper of this plan, or it may be more effective to have your fractional CFO maintain and update it on a continuous basis.

To develop an actionable list, ask the following questions:

  • What are your finance and accounting pain points? Who is addressing them?
  • What keeps you up at night? Where can finance and accounting help?
  • When is your next fundraising round, and what do we need to accomplish beforehand? For example, what internal processes need improvement to support scaling: invoicing, bill pay, expense management, budgeting, reporting, revenue recognition etc.?
  • Is your capitalization table and the company’s stock option plan in order?
  • What gaps/issues does your fractional CFO see?
  • Do you have a budget? Are you comfortable sharing it with investors?
  • Do you have a usable and impactful financial model?
  • Can you accurately forecast cash?
  • Are you doing a monthly close review? Is it timely and accurate?
  • Have you thought through Cost of Goods Sold (COGS) for the business?
  • Are you tracking the right metrics to manage the business and build the story for the next funding round?
  • Are you regularly updating investors?
  • Have you thought about compliance? What about state and federal regulations, labor law, sales tax, state payroll registrations, workers compensation, etc..?
  • Do you have the proper insurance policies in place? GL, E&O, D&O, EPLI, Cyber, etc.?

3. General Guidelines

As with any senior position, success starts with understanding how best to work with your fractional CFO. Your fractional CFO brings a wealth of experience and know-how that can save your startup time, money and headaches. If utilized correctly, your fractional CFO can become a very cost-effective senior resource for your startup and frees you and your team up for more product and go-to-market activities.

Here are a few best practice guidelines for working with your fractional CFO:

  • Meet weekly if possible, bi-weekly at a minimum. Getting on a regular cadence is a critical best practice.
  • When meeting, be prepared to discuss recent updates and share relevant data.
  • At every meeting, review and update the project plan to check progress and to share any new information that would impact any of the projects underway and impact future projects.
  • Be responsive and available for questions, especially early on in your relationship. It keeps keep everything moving as fast as it can for you.
  • Embrace your fractional CFO as part of your management team, letting your team and board know of their role and the responsibilities taken.
  • Get to know your fractional CFO. Many of them are former founders, CEOs, COOs, CROs and even VPs of Sales and Marketing. The more you understand their background, the more depth you have to fill additional gaps in your management team.

Knowing how to work with your fractional CFO—and understanding how to properly utilize the role—can deliver outsized advantages to your startup. You’ll save time and money, worry less about finance-related administrative and operational responsibilities, have accurate tools and information available to make decisions quickly, and have an experienced thought partner alongside you to help think through strategic issues. We’ve worked with hundreds of startups, and when it comes to finance, few early-stage executive decisions will have better a bang-for-the-buck than correctly using a good fractional CFO.