Fractional CFOs, or Remote CFOs have gained significant traction in the post-pandemic era.
But what is a Fractional CFO?
These finance experts offer CFO-level support to businesses either part-time or for specific projects.
During our interview with Gyanesh Changlani, a Fractional CFO on Toptal, he revealed that numerous startups, SMEs, and even large businesses in North America, Australia, the UK, and the UAE seek seasoned Finance Professionals for cost-effectiveness and scalability.
In 2021, after spending 15 years of his career in the UAE and India, he became a full-time Fractional CFO, working for North American clients.
Let’s explore the scope and opportunities in the realm of Fractional CFOs.
What are the benefits of being a Fractional CFO?
There are many reasons why people want to get into the freelancing Fractional CFO pathway. Some of the most common advantages are:
- Flexibility: Fractional CFOs have a lot of flexibility in their work schedule, making for an excellent work-life balance. They can choose the number of hours they would want to work and operate from anywhere they like.
- Be your boss: Fractional CFOs have the freedom to pick the projects they would want to work on and set their rates.
- Variety: Fractional CFOs get to work with various businesses and industries. This can be a great way to break the monotony and learn new things.
What are the skills, experience, and qualifications needed for the role of a Fractional CFO?
To become a fractional CFO, you would need the same qualifications and skill sets as a full-time CFO.
- An MBA or CA qualification is adequate for this role.
- A Master’s in Accounting or Finance can also be considered.
- Some employers may also require Fractional CFOs to have specific licenses or certifications, such as the CPA or CFA.
- Accounting, Budgeting, Forecasting, and FP&A are basic financial skills you must have.
- You have to help businesses solve complex financial problems. These problems can range from budgeting and forecasting issues to risk management.
- Most companies prefer 5-10 years of experience. However, 2-3 years of experience can also be acceptable.
Apart from technical skills and qualifications, here are some other factors that you should keep in mind:
- Build relationships with clients: As a Fractional CFO, you must build a good rapport with your clients. It will not just help you build credibility in the realm of freelancing but also help you better understand the client’s needs.
- Manage your time effectively: If you choose to work with multiple clients simultaneously, then you would have to manage your time properly. That’s how you can meet all your clients’ needs without compromising on their projects.
- Communication skills: While working remotely, good communication is essential to gain your client’s trust and maintain long-lasting relationships. You should be able to explain complicated financial concepts in simple words so that your clients can understand.
- The right mindset: Last but not least, having integrity and a strong work ethic is non-negotiable. Don’t overpromise and only accept the projects that you can deliver.
“Do not just focus on cost-cutting but also on increasing revenue. You need to have an analytical mindset to create reports, analyze KPIs, and provide clients with ideas on how to boost their business revenue.” – said Gyanesh.
What kind of compensation do Fractional CFOs typically earn?
Determining how to price your services as a Fractional CFO may feel like a tough task, especially when you are starting out.
But it doesn’t have to be.
First, you need to consider factors like your experience, the type of work, the location of the client, and the industry you’re in.
There are three standard pricing models: hourly rate, retainer, and project-based. It’s essential to pick the model that suits your and your client’s needs best.
Gyanesh mentioned that some consultants can earn as much as USD 250 or even USD 500 per hour when talking about clients from the US. Being a capitalist country, they value your services and compensate you well.
If you can bag multiple clients, your compensation would be indefinite.
“Today, I have six clients and earn almost five times what I was getting in the UAE or ten times the salary I would’ve earned in India. Of course, my 15 years of experience is also a determining factor.” – said Gyanesh.
As a freelancer in India, you can file taxes based on your business status rather than as a salaried professional, which can optimize your tax situation.
How can you find opportunities as a Fractional CFO?
Online job boards can be a great way to find clients and get your name out there. Some of the popular platforms are,
- Upwork – Upwork is a freelance marketplace with fractional CFO opportunities, which is possibly the most popular among freelancers. You can create a profile and bid on projects.
- Toptal – Toptal is a freelance marketplace that exclusively hires the finest fractional CFOs. You need to pass multiple levels of interviews to be accepted to the platform. The interview process is stringent but the remuneration is also high.
- Guru – Guru is another freelancing marketplace with fractional CFO opportunities.
- LinkedIn is without a doubt one of the best platforms for professionals. It allows you to connect with potential clients and network with other financial professionals to find opportunities.
- Indeed – Indeed is another popular job board that lists fractional CFO opportunities.
If finding clients on online platforms is not up your alley, we suggest you check out specialized Fractional CFO Services Companies. Yes, there are companies that offer fractional CFO services. Contact them and they will connect you with potential clients and help you manage your workload.
Finally, nothing beats networking as one of the best ways to find these kind of opportunities, be it online or offline.
Attend industry events, connect with other financial professionals online, and let people know you are available for fractional CFO work.
The Global Virtual CFO market is expected to grow significantly from 2022 to 2030.
Don’t be discouraged if landing the first gig as a Fractional/Remote CFO takes months.
Start by working with small businesses or startups and work your way up to large corporations. This will allow you to gain experience and build your reputation.