What Is a Fractional CFO?

What a fractional CFO does

A fractional CFO is a senior finance leader who works with your company part-time, at a fraction of the cost of a full-time hire. They do the forward-looking work a CFO does: cash flow forecasting, budgets, pricing decisions, lender and investor conversations, and preparation for a sale or raise. They just do it across a few companies instead of one.

The easiest way to understand the role is by comparing it with the finance people you may already have:

Notice that none of these roles replace another. A fractional CFO works alongside your bookkeeper and CPA, using the numbers they produce to answer a different question: not what happened, but what to do next.

What it costs

Fractional CFO engagements are typically fixed-fee and scoped to deliverables rather than hours, so you know the cost before work begins. Pricing varies with the size of the company and the scope of the work.

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7 signs you need a fractional CFO

None of these signs is about intelligence or effort. They are about infrastructure. Most owners hit them at some point between $5M and $100M in revenue.

1. 1

   You are profitable but always short on cash.

   Profit and cash are not the same thing. If the income statement looks fine while the bank account runs thin, nobody has connected the two. A 13-week cash flow forecast makes the timing visible before it becomes a crisis.

2. 2

   You have no monthly forecast.

   You know what last month looked like, but not what next quarter looks like. Without a forecast, every big decision (a hire, a lease, a piece of equipment) is a guess about money you have not counted.

3. 3

   A bank or buyer is asking for numbers you cannot produce.

   Loan covenants, lender packages, and diligence requests all expect clean, timely reporting. If assembling the numbers takes weeks of scrambling, the ask only gets harder as the company grows.

4. 4

   You are planning to sell in the next two to three years.

   Buyers pay for clean books, predictable cash flow, and a management team that understands its own numbers. Getting the house in order a couple of years before a sale protects the multiple far better than cleaning up during diligence.

5. 5

   You are growing faster than your reporting.

   Revenue is up, headcount is up, and the spreadsheet that worked at half the size no longer answers real questions. Growth exposes weak finance infrastructure faster than anything else.

6. 6

   Every decision waits on information that arrives too late.

   If the numbers show up mid-month, describe six weeks ago, and still do not answer the question you actually asked, leadership ends up deciding on instinct instead of information.

7. 7

   Your finance function depends on one person.

   If one bookkeeper (or one family member, or you) holds all the numbers in their head, the company has a single point of failure. A fractional CFO builds a reporting cadence that survives vacations, turnover, and growth.

If two or more of these describe your company right now, a conversation with a fractional CFO is usually worth the thirty minutes. If none do, keep doing what you are doing; a good bookkeeper is enough.

What the first 90 days look like

Every engagement is scoped to the company, but a well-run first quarter follows the same arc:

After that, the engagement settles into a rhythm: a weekly cash cadence, a monthly close and review, and senior finance judgment available for the decisions that matter. Most owners say the change is less about new reports and more about walking into Monday knowing where the money stands.

How to choose one: questions to ask

The title is unregulated, so two people calling themselves fractional CFOs can offer very different things. Before signing anything, ask:

• Who will actually do the work, and what is their background? You want the person you met to be the person on your account.
• What are the deliverables each month, and what is the fee? Good engagements are scoped in writing: named deliverables, a fixed price, no hourly surprises.
• How will you work with my bookkeeper and CPA? A fractional CFO should make them better, not replace them.
• What does the first 90 days look like? You should hear something close to the sequence above, in specifics.
• Have you worked with companies our size, in our industry, or through what we are about to go through (a loan, a sale, a rapid hire)?
• How do we measure whether this is working? Ask for a concrete answer: faster closes, a forecast you trust, numbers a lender accepts without rework.

A good fractional CFO will ask you nearly as many questions as you ask them. The fit matters: this is someone who will sit next to you through the biggest financial decisions your company makes.