Relationships make or break businesses – especially at the top. Founders and CEOs often find themselves needing support from an advisor that they can rely on to give them an unbiased opinion. Enter the CFO. Chief financial officers are increasingly becoming the second-in-command to founders.
The founder and CFO relationship is one of the most important in any organization. They should be able to work independently of each other while giving the other the support that they need. CFOs provide the data-driven insights that ground the decision-making process of every founder and CEO.
Not all founders and CFOs work side-by-side. Recruitment agencies like FD Capital are seeing a rise in demand for part-time, interim, and fractional CFOs. Most start-ups and scaling businesses choose to hire a CFO on a more flexible basis to make it financially affordable. What does that mean for founders and CFOs?
Part-time CFOs may only work for the company a few days a week or on a remote basis. It makes it more difficult for CEOs and CFOs to fall into rhythm with each other, but it’s not impossible. We’re sharing how founders and part-time CFOs can develop their relationships to deliver real results.
CEOs are always looking ahead. That’s why they need a CFO to keep them grounded. While CFOs lay the groundwork for growth, they also keep their fingers on the pulse of current events. A CEO planning for the future is operating in the dark without the help of a part-time CFO.
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It’s the responsibility of CFOs to carry out risk assessments and prepare the company for times of economic uncertainty or market disruption. Both the CFO and CEO are thinking of the future – only in different ways.
Recognizing a CEO’s focus on growth and a CFO’s focus on future-proofing can provide a basis for joint-up thinking. The CFO-CEO relationship is what provides forward thinking in any company.
United Approach to Stakeholders
Founders and their CFOs should work in unison with each other. A strong CEO-CFO relationship relies on putting up a united front, especially with stakeholders. A strong CEO-CFO relationship can even save companies on the verge of bankruptcy.
Elon Musk and Deepak Ahuja were able to save Tesla from financial uncertainty to become one of the world’s most valuable companies. Ahuja entered Tesla in 2008 with the task to save the company from financial ruin.
The importance of Musk and Ahuja’s relationship was so strong that the company’s stocks dropped sharply after Ahuja announced he was leaving the company. Why? The stocks tumbled because stakeholders had come to come to value the importance of the CEO-CFO relationship and their united approach to stakeholders.
Communication is vital in every relationship. It should be the focus of the early days of a CEO-CFO partnership. A trusting relationship takes small steps to achieve. Communication is the key to this. A founder and part-time CFO should feel like they can speak to each other in confidence and get an unbiased opinion from each other.
CEO-CFO relationships only succeed when they are a partnership of equals. They should both feel like can talk to each other plainly about the company’s situation. It may mean that the CFO has to deliver hard truths to the CEO – and vice versa.
A part-time CFO can only do their job effectively when they can openly communicate with their CEO. It’s impossible for a CFO to do their job with only half the picture.
Sharing information and openly communicating with each other allows CFOs and CEOs to present a united front for the board and investors.
Automating Data Sharing
One challenge of the founder and part-time CFO relationship is that the pair isn’t always together. It’s not like traditional c-suite working environments where the two will be in an office together. Remote and flexible working makes automated data sharing vital.
CFOs need to be able to provide their latest forecasting and data analysis to the founder to ground their decision-making. It’s the responsibility of the CFO to translate this financial data for the CEO.
Automated data sharing and cloud-based project management tools allow CEOs and CFOs to stay up-to-date with each other’s work. Part-time CFOs may only get to see their founder in person once a week or even less in remote working situations.
Investing in data sharing and software that visualizes data will help CFOs to move away from traditional spreadsheet-based approaches. CFOs and founders can build strong relationships by keeping communication channels open with each other.
Choosing to incorporate automated systems and data sharing can avoid confusion and keep both parties in the loop.
Choose the Right CFO for Your Company
Building a winning founder and CFO partnership starts with the recruitment process. A founder should be deeply involved in the recruitment of their CFO. You want to choose a candidate who shares your values and whom you can build a strong working relationship with.
Recruitment agencies like FD Capital can curate the hiring process to your needs. Start by identifying the responsibilities you want to hand over to your CFO. Many CEOs choose a candidate who can fill a skills gap in their c-suite.
You may choose a CFO who has greater industry knowledge than you or one with more connections to investors. Work with a recruitment agency to filter through the candidates and find one who will be right at home with your company culture.
C-suite relationships are crucial for the success of any business. In the era of hybrid and flexible working, it’s never been more important to curate the relationship between a founder and a part-time CFO. Building a winning CEO-CFO relationship is the key to unlocking the potential of every business.
Are you looking to find your second in command? Start recruiting for a part-time CFO by signing up with a specialist recruitment agency. FD Capital is the leading CFO recruitment agency, hiring on a part-time, interim, and remote basis. Start your journey towards a winning CEO-CFO relationship today.