03 May 2022
As your business puts down roots and becomes more established, you’re going to need expert financial advice to move forward – whether this is to evolve your financial model, raise more finance or spot opportunities to help grow the business. You may decide you need a finance director to help drive these plans, but what’s the most efficient way to source your own FD?
Should you create an internal role and hire your own full-time finance director? Or will you get more value from an outsourced model, where you get the benefits of a part-time ‘virtual FD’ alongside the support of an outsourced finance function to sweeten the deal?
We look at the key reasons you may need an experienced FD in the first place, and why a virtual FD could be the best option for established start-ups looking to take their next step.
To begin with, let’s ask why your business needs an FD at all. You have an accountant doing your annual accounts, tax returns and monthly reporting, after all. So why do you need an FD to add to this pre-existing financial support set-up?
In a nutshell, it boils down to a key distinction between what a traditional accountant delivers, and the added value you can get from having an FD at the helm of your financial ship.
By looking at your key financial drivers, drilling down into the numbers and looking for the opportunities for improvement, your FD takes the business to the next level. In other words, they give you a more grown-up, forward-looking overview of your finances.
If the business is demanding a more complex overview of your financial management, the temptation is to opt for an internal hire. By creating a permanent full-time finance director role, you put some real momentum behind your financial evolution.
With an FD on the management team, you’ll get:
Sounds ideal, doesn’t it? Who wouldn’t want to bring this level of skill and expertise into their ambitious and growth-hungry small business?
But there is a catch. A full-time FD come with a few caveats and considerations that could make things look a little less attractive:
And, of course, you’ve got to find the best person for the role in the first place. Finding someone with the right level of experience, in the right market, at a price you can afford is no simple task. So, if you’re at a relatively early stage of the company’s development, is there another option?
This is where an outsourced virtual FD could be the answer to your start-up prayers…
A ‘virtual FD’ brings all the key benefits of an internal FD, and at the same price. What’s removed is the long-term investment of a permanent director role, with the added bonus of the increased flexibility and scope of an outsourced model.
When you’re still settling into your market and whipping your business model into shape, it’s unlikely you’ll want to be tied to a permanent FD role. But with a part-time virtual FD, you can still get the kind of top-drawer financial advice that’s needed to push the company to its next stage on the business journey.
With a virtual FD working alongside your management team, you’ll get:
This last point is the real icing on the cake for ambitious businesses that have big aspirations and clear business goals to achieve, as we’ll explain…
Rather than gaining one internal FD role, with an outsourced model you get access to your own virtual FD and an entire outsourced finance team.
You’re bringing in the flexible services of a diverse team to cover the accounting basics, intermediate finance jobs and higher-value reporting and scorekeeping – PLUS the proficiency of an expert FD when you need strategic insight and top-level advice and planning.
By opting for the ‘Virtual FD + outsourced finance team’ model, what you get is:
If you’re a busy owner manager, or a time-starved founder with a long to-do list, having your whole finance function outsourced is a real game-changer. You can forget about mundane bookkeeping and data entry of expenses and get on with building the business.
And, with access to your part-time FD, you have an experienced finance professional to turn to when you need support, have a key strategic question or just want the confidence of talking through the next step in your business journey.
At FD Works, we want to get under the skin of your business and delve deep into your numbers. From there, we can simplify complex systems, optimise processes, and offer you real insight that will take your business to the next level.
The more time our experts spend on the ground, within your business, the more they become part of your team and function seamlessly. Take that to do list into reality with someone you can trust to get things done, without the worry of a heft bill at the end of the month.
FD Works are a team of accountants, business advisors and Xero specialists located in Bristol and Bath. Founded in 2013, we provide our clients with hands-on finance support in a real partnership.
We give you top-level FD support, and cover all your financial basicsCall us for a chat