As your startup grows, your finances become increasingly complex and time-consuming. When you continue managing your finances on your own, you’re left with less and less time to focus on actually growing your business and are constantly playing catch-up with your responsibilities. The pressure is on to always understand your numbers and at the same time, lead others to action based on that data.
There comes a boiling point when you need to hire a financial professional to offload some of that pressure.
If you’re experiencing rapid growth in revenue or customers, a financial controller is indispensable. And for many startups, outsourcing this role is a more practical solution than hiring in-house.
Continue reading to learn the benefits of outsourcing a financial controller and why it’s a non-negotiable for your startup.
What Is An Outsourced Financial Controller?
An outsourced financial controller provides financial oversight and management services to businesses on a contractual basis. Unlike an in-house controller, this is not a full-time role and the controller typically works remotely.
While it’s valuable for your startup to use a controller’s knowledge and experience to your advantage, you may not have enough work to justify hiring one in-house.
That’s where an outsourced employee comes in.
Core Responsibilities Of An Outsourced Financial Controller
Whether in-house or outsourced, a financial controller's responsibilities include overseeing all aspects of a business's finances such as:
- Ensuring your startup complies with all regulations and accounting standards.
- Managing all accounting systems, accounts payable, accounts receivable, and financial staff.
- Providing financial analysis and reporting that help your management team make strategic decisions.
- Monitoring internal controls and proactively advising on market trends.
- Supporting federal income tax reporting.
- Educating employees on business responsibilities and best practices.
Overall, a controller’s responsibilities depend on the business, but regardless, this role contributes to the organization's financial planning, health, and success.
Why Startups Should Outsource Financial Experts
Sounds like a good way to boost your startup’s efficiency and effectiveness!
But outside of taking on the tasks we listed above, an outsourced controller brings so much more value to your startup behind the scenes. Here’s why.
1. More Cost-Effective Than Hiring In-House
Outsourcing financial controller responsibilities are often more cost-effective than hiring an in-house controller or CFO. If you don’t have enough work to occupy a financial controller full time, the cost of a salary and benefits can drain your limited resources (the average salary of a full-time financial controller is about $244K).
By outsourcing, you get the same expertise and experience at a lower cost.
2. Helps You Make Informed Financial Decisions
An experienced financial controller is not limited to providing basic accounting functions. They should advise on strategies and help you anticipate roadblocks. They help you make informed decisions about investments, cash flow management, and budgeting.
3. More Timely And Accurate Reporting
Outsourced financial controllers provide timely and accurate, GAAP-compliant financial reporting, which is necessary for you to make informed and effective decisions. This aspect of the role includes generating your monthly financial reports – cash flow statement, balance sheet, and P&L.
4. Saves Time
By outsourcing financial support, you can focus on other core responsibilities, such as product development, marketing, and customer service.
Thanks to their expertise, a financial controller can tackle and solve problems quicker than a less experienced bookkeeper or accountant. This can make your startup more agile, allowing you to consider strategy shifts and opportunities while your competition lags behind, weighed down by regulatory and accounting headaches.
Can't Startups Just Manage Their Finances On Their Own?
While startups can survive managing their finances on their own, outsourcing financial controller responsibilities can provide important benefits. As a startup owner, your time is invaluable, and managing financials without expert help can be tedious and stressful.
You also might be tempted to hire a less experienced CPA to manage your finances to save on salary costs. However, good financial management can often be the difference between success and failure for a lean startup.
Placing the future of your business in the hands of those with less experience can open your business up to unnecessary risk. It’s often a much safer alternative to contract an experienced finance professional on a part-time basis.
Explore Outsourced Controller Services For Startups
Outsourced financial controller services provide serious benefits for startups, from cost savings and improved financial reports to reduced stress and a lighter workload.
If you're a startup owner, it’s 100% worth it to look for a quality outsourced financial controller service. By outsourcing your financial management to an experienced team, you can be confident that your business is in good hands.
If you’re still unsure if you’re ready to hire an outsourced controller, we’ve got some more tips on that for you here.