Efficient Finance Operations
Given how much CEOs and startup founders need to tackle every day, they tend to trivialize the importance of financial operations of its business, and worse yet, look down on and making it a “chore” to deal with to accomplish their goals to change the world. I have witnessed this unfolding in many companies.
On the other side of the spectrum, seasoned CEOs go out of their way to hire the high caliber CFOs and/or VP Finance with a potential to grow into CFO roles and have the insight to how much value they bring to the company and know that good finance players often pay for themselves within a short period of time from hiring dates. Why do they do that? Why is there a divide between the two groups of startup CEOs?
Good CEOs know, intuitively, companies are run by people and people make or break the company, by hiring the right people in the right position accomplishes a lot from the get go. By the same logic, if you want to build a strong company with equally strong operations (hence, there is minimum breakdown in a hectic day-to-day operations), you need a solid finance team to oversee financial operations.
FAQs in startup companies are :
“How do I pay my vendors/employees/contractors/bills?”
“Where are the bills (for tax, payroll, utilities, etc.)?”
“How do we pay them (credit card, ACH, wire, etc.)”
“What happened (when bills become delinquent)?”
“Where is a 3-year annual plan that Board is asking?”
“When do we run out of cash?”
“How to manage options and what are they?”
Some are simplistic in nature (that lead to a multitude of operational questions) yet hugely impactful on the business as it creates confusion in people, hence mistrust, and chaos which, CEOs need to avoid at all cost. By hiring the right CFOs and/or engaging the firm that provides the right level of services, they can navigate the challenges of being a startup and build a strong foundation to be fulfill their visions and dreams.