Should I Hire an Interim CFO?

Whether you stand at the helm of an established brand or a fledgling startup, you may be looking for a finance professional to help grow your business, tackle a new project, oversee the accounting department, or fulfill an advisory role. 

CFOs can do all of the above and more for your company—but you may not be ready to hire a full-time, permanent CFO. If this is the case, an interim CFO may be exactly what your business needs. 

Should you hire an interim CFO? Below, we will break down a few scenarios you might be facing as a brand and explore the potential role of a short-term finance expert in each one. 

Interim CFO Considerations: 4 Scenarios

Every brand is unique, and so are the circumstances in which each one might hire a CFO. In this guide, we will focus on four general scenarios when you might consider adding a finance professional to your roster:

• Short-term vacancy – Maybe your full-time CFO is taking parental leave, a sabbatical, or a multiple-month vacation.
• CFO resignation or termination – Perhaps your CFO has resigned or was terminated.
• Building a CFO position – Maybe you do not yet have a CFO position, but the time has come to create one.
• Upcoming project – If you have an exciting new project on the docket—like a merger or a new accounting software purchase—perhaps you need some guidance as you tackle it.

Scenario 1: Short-Term Vacancy

If your company has a CFO, but that person is planning to take a few months off, you must contend with a vacancy until they return. Should you hire an interim CFO in this scenario?

You should consider hiring an interim CFO if:

• Your full-time CFO is considering a permanent exit from the company—perhaps they are considering staying home long-term after their baby is born, or maybe their sabbatical is intended to be a “practice retirement” 
• The short-term vacancy coincides with an important financial milestone—filing this year’s tax return, preparing financial statements for your VC firm, or running a capital fundraising campaign

But, it might be wiser to await your permanent CFO’s return if:

• Their vacancy is truly short-term—they plan to come back within eight weeks
• They show a strong intention to return after their leave of absence
• They will be available as needed throughout their absence
• The company can continue to operate as usual (or nearly as usual) until their return

Scenario 2: CFO Resignation or Termination

If your full-time, permanent CFO has recently resigned or been terminated from your company, you have three options. You can:

1. Hire another permanent, full-time CFO to replace them
2. Hire an interim CFO to fulfill the role while you search for a permanent replacement
3. Find a way forward without a CFO

If you take the first route, it is difficult to say how long it will take to hire a permanent replacement for your former CFO. LinkedIn reports an average of 37 days to hire an accountant, and the process for a CFO will surely be more involved and harder to fill. So, if you need to fill the position quickly, consider hiring an interim CFO to bridge the gap–depending on who you partner with, they may eventually take the role full-time.

Scenario 3: Building a CFO Position

If your brand is in the early growth stages, you may not have a CFO yet. And finding the perfect time to hire a CFO can be challenging even when you know your precise requirements after working with one for years.

An interim CFO is an excellent solution for:

• Budding brands just starting to turn a profit
• Companies trying to determine the right time to hire a CFO
• Teams who are working on creating a CFO position

Why is an interim CFO an ideal choice in the circumstances above?

• Cost – The median CFO salary in the US is $419,100. If your brand cannot afford a full-time, permanent CFO yet, an interim CFO can help you meet your financial services needs without adding an executive salary to your payroll. 
• Tenure – Interim CFOs can be temporary. While people seeking full-time CFO positions might be looking for something more permanent, interim CFOs understand that their time at a company may be limited.
• Expertise and resources – Interim CFOs typically work for Finance as a Service agencies—companies that have numerous financial experts in their ranks. As you build a CFO position or flesh out how a CFO can help your brand, you can seek advice from both an interim CFO and their professional network. 

Scenario 4: Upcoming Project

If your brand does not currently employ a CFO, an interim CFO can help your team navigate an upcoming project. Moreover, when you hire an interim CFO on a project basis, this person will not expect a permanent position at your company once the project is complete. 

Some examples of projects that might benefit from interim CFO guidance include:

• Creating an accounting department – If your company is ready to hire additional staff to manage everyday transactions, compile financial statements and other reports, or perform other tasks, an interim CFO can help you structure this department, write SOPs, and staff it.
• Mergers and acquisitions – If your brand is merging with or purchasing another company, an interim CFO can provide financial and regulatory guidance during the negotiation and transition processes.
• Making structural changes – Changing your company name, switching your legal status (e.g., changing from an LLC to an S-Corp), or selling shares to a new majority shareholder all require extensive financial and legal knowledge—an interim CFO has both. 

Integrating new accounting software

– If your accounting department needs a software tool to organize transactions, automate processes, and compile reports, an interim CFO can help you choose a software product, create SOPs for incorporating it, and help train your staff to use it.