When to Hire a CFO: 5 Signals You’ve Outgrown Your Current Finance Setup

Most companies don’t hire a CFO on a predictable timeline. They hire one when they realize—sometimes too late—that their current finance setup can’t support what they’re trying to accomplish.

The question isn’t whether you’ll eventually need CFO-level support. It’s whether you recognize the signals before gaps in financial leadership cost you money, delay your growth, or complicate your fundraising.

Here are five signals it’s time to bring in strategic finance leadership—and why waiting too long carries real costs.

5 Signals It’s Time to Hire a CFO

1. Your bookkeeper can’t answer strategic questions. Bookkeepers track transactions. CFOs interpret what those transactions mean for your business. When you ask “Can we afford to hire two salespeople next quarter?” and your bookkeeper can’t give you a confident answer based on financial modeling, you’ve outgrown bookkeeping-only support.

2. Financial decisions take too long. If every significant investment, hiring decision, or growth initiative stalls while you try to figure out the financial implications, you’re operating without the strategic clarity a CFO provides. Speed matters in growth—and slow financial decision-making is a competitive disadvantage.

3. Cash flow surprises are becoming common. Running out of cash or scrambling to make payroll shouldn’t happen to well-managed companies. If you’re regularly surprised by cash position, you need forecasting and cash management that goes beyond what bookkeepers deliver.

4. Your board or investors want more than you’re providing. When investors start asking for reports, forecasts, and KPIs you can’t produce—or push back on the quality of what you send—you’re signaling that your finance function isn’t keeping pace with expectations.

5. You’re spending too much time on finance yourself. If you’re the de facto CFO on top of running the business, you’re either neglecting strategic finance work or neglecting other CEO responsibilities. Neither is sustainable.

Revenue Thresholds: When CFO-Level Thinking Becomes Critical

While every business is different, general patterns exist:

$1–3 million revenue: Most companies operate with a bookkeeper, possibly outsourced. Basic financial management is sufficient if operations are straightforward.

$3–10 million revenue: Financial complexity increases. Multi-product businesses, growing teams, and investor relationships often require more than bookkeeping. Fractional CFO support often makes sense in this range.

$10–30 million revenue: CFO-level support becomes critical. Sophisticated forecasting, capital allocation decisions, and strategic planning require dedicated attention. Many companies bring on fractional support, with some transitioning to full-time.

$30 million+ revenue: Full-time CFO is typically justified. The complexity and strategic demands warrant a dedicated executive.

These thresholds shift based on your growth rate, industry, and complexity. A SaaS company at $5 million may need CFO support sooner than a stable services business at $15 million.

Fundraising, M&A, or Expansion? You’re Already Late

Certain events accelerate the need for CFO-level support:

Fundraising: Investors expect financial models, forecasts, and professional-grade reporting. Building these during the fundraise creates delays and stress. Having them ready before you start signals preparedness.

M&A—either direction: Whether you’re acquiring a company or being acquired, due diligence is finance-intensive. Integration requires financial planning and systems work. Without CFO leadership, these processes become chaotic.

Major expansion: Opening new locations, entering new markets, or launching new products requires financial modeling, scenario planning, and cash flow management that bookkeepers aren’t equipped to provide.

If any of these are on your 12-month horizon, the time to add CFO support is now—not when you’re already in the middle of the process.

The Cost of Not Having a CFO During Key Inflection Points

The absence of financial leadership carries real costs:

Poor decisions on incomplete data. Without proper financial analysis, major decisions rely on gut feeling rather than modeling.

Missed fundraising opportunities. Investors pass on companies that can’t articulate their financial story clearly.

Cash flow crises. Without forecasting, you discover runway problems too late to address them gracefully.

Lower exit valuations. Companies with messy financials and no CFO leadership often receive lower offers—sometimes significantly lower.

Founder burnout. Playing CFO on top of CEO is exhausting and unsustainable.

Companies frequently underestimate these costs because they’re not line items. But founders who’ve experienced cash crunches, botched fundraises, or disappointing exits often trace problems back to inadequate financial leadership.

Fractional vs Full-Time CFO: Which Fits Your Stage

You don’t necessarily need a full-time CFO immediately.

Fractional CFOs work well when:

• You need strategic guidance but not daily presence
• Your current bookkeeper or controller handles operations well
• You’re managing costs carefully at earlier stages
• Your needs fluctuate—heavy during fundraising, lighter otherwise

Full-time CFOs make sense when:

• Finance complexity requires daily attention
• You need an executive-level partner in leadership
• You’re operating at scale ($30M+ typically)
• You have a board that expects senior finance presence

Many companies use fractional CFO support until they reach $15–30 million in revenue, at which point a full-time hire becomes justified. Others keep fractional relationships long-term because the flexibility and cost structure work for their situation.

There’s no single right answer—but there is a wrong answer: doing nothing while complexity outpaces your finance capabilities.

What a CFO Actually Does (Beyond “Big Picture Finance”)

CFOs do more than review financials and attend board meetings. Depending on your needs, a CFO provides:

Financial strategy. Connecting financial decisions to business strategy. Capital allocation, growth investment, and profitability optimization.

Forecasting and modeling. Building and maintaining financial models that support decision-making. Scenario planning for different growth paths.

Fundraising support. Preparing materials, managing data rooms, answering investor questions, and negotiating terms.

Cash management. Optimizing working capital, managing treasury, and ensuring runway.

Operational finance. Pricing strategy, cost structure analysis, unit economics, and performance measurement.

Risk management. Identifying financial risks and implementing controls.

Team development. Building and managing the finance function as you grow.

The specific focus depends on your stage and priorities. A startup CFO may spend 70% of their time on fundraising preparation. A scaling company’s CFO may focus on operational finance and margin improvement.

Understanding what a CFO can do—and what you need—helps you hire the right one.