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2 Ways to Know if Your External CFO is Right for Your Business

It can be a challenge to know if an external CFO is right for your business.

External CFOs allow businesses owners to experience the value of a traditional CFO but at a fraction of the cost. However, the investment of thousands of dollars per month is still significant for many small business owners, and that means that it is critical for business owners to work with the right external CFO or virtual CFO.

External CFOs offer various critical services to business owners including setting strategic direction, financial forecasting and setting KPIs. External CFOs work with business owners on both quantitative and qualitative matters. That means they understand your business from a financial and non-financial perspective.

As a business owner it is critical that you engage with the right external CFO for you.

The right external CFO will be a vital part of making your business the business of your dreams.

1) Do you Trust them?

The fastest test you can do to see if your external CFO is right for you is asking yourself the question “do I trust them?”

Trust is primary to anything else when you are working with someone to improve your business because it will ultimately reveal the range of other key areas of competence.

When you trust someone it tells you the following:

  • You believe in their technical ability.
  • You know they won’t lie to you about your business.
  • You will be comfortable divulging the good, bad and ugly about your business.
  • You know they understand the direction of your business.
  • You know they have the best intentions for your business.

2) Is your business headed in the right direction?

This question isn’t just “are you getting the right results?” It is beyond that – it is a question of “are the results we are measuring the right results to measure for our business, and are we headed in the right direction on those metrics?”

Inspiration is one of our core values here at LGAS, and inspiration means you have a vision for your business.

If you don’t have a vision for your business, you need one.

That is because your vision determines your direction. Your external CFO will work with you to advise you on both how to get to where you want to get to, and will work with you to create metrics that measure if you are getting there.

Because external CFOs are experts in non-financial and financial matters, they have the skills to both understand the non-financial issues with determine the direction of your business, and an understanding of the metrics that tell you if you are moving towards that direction.

Ultimately, that means if your business is headed in the right direction and you have an external CFO, you will be able to look at the numbers which tell you that.

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