It’s not practical or economical for many SaaS startups to hire a full-time CFO to handle their financial matters in-house. In many cases, it makes more sense to work with a fractional CFO, or an external financial partner who works with your startup – and others – on a contract basis. Just think of a fractional CFO as a part-time CFO who works outside of your business, but who you can rely on for expert financial services.

Strategic financial management is key for any business, let alone a startup. It serves as a guiding light for where your startup is and where you want to go. Good financial management is a way to ensure you’re maximizing your startup’s market value and reaching long-term goals.

Why SaaS Startups Need a Fractional CFO

From cash flow challenges to difficulties raising capital to budgeting, startups face a unique set of financial challenges. This is especially true of SaaS startups; It’s a complicated business plan and it can be even more complicated to keep accurate financials. While it’s possible to hire an in-house CFO or assign an existing team member to manage the financial situation, it’s not always the most economical, practical or smartest decision for a young business that’s looking to scale and grow.

That’s where seeking fractional CFO services can help. As a cash-strapped startup, you’re saving money by outsourcing this role. Yet, you’re still receiving expert-level service from an finance specialist who knows the ins and outs of your business and has expertise working with SaaS startups like yours.

Benefits of Hiring a SaaS Fractional CFO

Hiring a fractional CFO has its benefits – here’s a look at a few of them:

Cost-Effective Financial Expertise

When you hire a fractional CFO, you’re getting expert guidance for your financial operations at a fraction of the cost of what it would be to hire a CFO in-house. This creates a unique value proposition that makes working with a trusted partner all the more attainable, especially if you’re working with a fractional CFO who has experience working with SaaS startups. There’s little learning curve for this CFO partner, meaning they can begin providing value for your startup sooner. There’s also cost flexibility that can lead to significant cost savings. For instance, at Graphite Financial, we offer a fixed monthly pricing model and special offers for early-stage startups.

Strategic Financial Planning

Financial modeling, cash flow management and fundraising are all important for SaaS startups who plan on sticking around in the market – and a fractional CFO can help with all of this. From ensuring accurate financial reporting in the present day to long-term scenario planning and strategic planning, there’s value in working with a fractional CFO beyond the here and now, but in setting your startup up for a sustainable future.

Industry-Specific Knowledge

Industry-specific expertise is necessary when you’re launching a startup. Oftentimes, you’re not able to hire a professional with the level of experience necessary if you plan to bring a financial professional in-house, which can be problematic. If you do, it might take weeks – perhaps even months – for this employee to really get to know the business and how it operates to perform their duties appropriately.

However, when you work with a fractional CFO, you’re already working with a trusted expert. At Graphite, we pride ourselves on pairing our professionals with the startups in markets that they have experience in. For example, SaaS startups can rest assured that they’ll be working with a fractional CFO who has specific experience in SaaS businesses to add more value.

Key Services Provided by a SaaS Fractional CFO

Financial Modeling and Planning

Financial modeling is important for capturing a snapshot of where a company currently is while helping to provide a roadmap to projected future financial performance to help influence where a company may be headed in the future. When you work with Graphite and take advantage of our fractional CFO service offering, you’ll get more than just a professional to help manage the books, but someone who has a keen understanding of financial models and unit economics to help assist decision-making and help make your startup as attractive as possible to potential investors.

Fundraising Support

Startups need to overcome financial challenges and fundraise to help bring their vision to life. For startups to operate, they need capital. To attain the necessary amount of capital to operate, they need investors on board who believe in what they’re doing and see the financial opportunity. Fundraising for a startup is a bit like taking a leap of faith and trusting that the support helps the business prosper to a point where investors also prosper over the long term. A good fractional CFO can help facilitate venture capital, improve investor relations, and make your startup more attractive to potential investors, which can significantly help with the multiple rounds of fundraising efforts your startup will require.

Cash Flow Management

Good cash flow management often translates to good financial health and business stability – and vice versa. That’s why a big part of any fractional CFO’s duties is to accurately manage cash flow to cover expenses and remain solvent. Good cash flow management can do more than just paint an accurate picture of how much your startup is spending versus how much it’s earning, it can also help improve operational efficiency, better prepare for challenges, improve access to financing and help leadership make better, more educated decisions.

Compliance and Tax Management

Any time earned income is involved, Uncle Sam is coming for what’s his. Yes, complying with tax laws is a part of doing business, and it’s another way that working with a qualified fractional CFO can help your startup. In addition to ensuring that your startup is complying with all tax regulations, a fractional CFO will also go to bat for you to ensure that you’re receiving all credits that your startup qualifies for. Many startup firms may be eligible for several credits, including but not limited to R&D credits.

How Graphite Financial Supports SaaS Startups

When you work with Graphite for your fractional CFO needs, you can rest assured that we’re well-positioned to serve your startup and the best interests of your growing business. We strive to be more than just a reliable partner, but a true extension of your startup that you can count on for the important task of financial management.

Dedicated Team of Experts

Partnering with Graphite ensures that you’re receiving expert-level financial service – but at a fraction of the cost that you’d have to invest in someone were you to bring a professional in-house. Our track record speaks for itself. We strive to become your long-term financial partner, ensuring your startup receives the dedicated attention it needs. We pride ourselves on only having our financial professionals work with a handful of clients at a time, meaning you’ll get high-level service that will truly feel like an extension of your startup. Additionally, we’ll work to pair you with a strategic partner and financial expert who has experience in the market your startup is operating in to ensure the highest level of service possible.

Comprehensive Startup Accounting Services

From bookkeeping to financial modeling to tax services to bill pay and invoicing, we do it all for your SaaS startup. Our industry-specific approach to bookkeeping and financial modeling allows us to provide a high level of service to our clients and scale up with them as they grow. Our proof is in the pudding – we’ve worked with more than 250 SaaS startups, helping them grow and prosper in part due to our expert-level accounting services and the actionable insight that it can help provide.

Final Thoughts

Proper financial management is important for any type of business, but it’s arguably all the more important for a SaaS startup that can’t afford to make financial mistakes and has a unique business model when compared to more conventional businesses. You can either bring in your own full time CFO, which can be costly, assign a current employee to handle the finances, which can be risky, or work with a trusted partner like Graphite for all of your financial needs.

If you’re interested in the latter, contact Graphite today to learn more about how we can help your SaaS startup. We offer flexible pricing plans and specials for early-stage startups.

Take the Next Step with Graphite Financial

For a custom plan tailored to your SaaS startup’s specific needs, contact us at Graphite today. With special pricing and programs available for early-stage startups, we’ll work with you on all the accounting services that you need to continue to advance your young business. We’re your one-stop shop for fractional CFO services.

Contact us today to learn more and discuss all of your accounting needs with a Graphite Financial expert.