Friday 19 August 2016

Virtual CFO for your Start-Up (5 Reasons your virtual start-up needs a virtual CFO)



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Raising Finance, Managing Cash Flow and keeping Accounts compliances in order is as important as any other function in a Start-Up (even more so!!). There is a small glitch though…..most start-ups cannot afford a CFO!!!.
Frugal Innovation (Jugaad) has been the backbone of Indian Start-Up eco system and the concept from west of having a part time Chief Financial Officer also popularly known as Virtual CFO. In this blog, we will discuss the reason for having a Virtual CFO in the system
1-      Fund Raising: A start-up, be it in e-commerce space or any traditional business, requires funds to settle and later expand. Funds can be in Equity form or Debt form. Raising Fund requires lot of planning and terms & conditions and it requires a CFO who has experience in all these aspects. Hence even a start-up requires Virtual CFO (part time). Lot of virtual CFO works on small token amount and some equity as compensation without putting too much pressure on resources of start-up.
2-      Cash Flow: Cash Flow planning is much more complicated than what lot of people thinks. Many a companies have gone bankrupt despite making profits just because of poor cash flow management. Virtual CFO ensures that Cash Flow management is done in right way keeping in mind all the idiosyncrasies of business.
3-      Right Valuation: Lot of entrepreneurs are not sure about the right valuation to ask for their venture and they end up asking either too large a valuation or too small a valuation (both of which are detrimental). With help of virtual CFO, start-ups knows the right expected valuation of company and chances of fund raise increases.
4-      Work Capital: Business have regular working capital requirement and Start-up/SME really struggle on this front. But fortunately various options are now available to avail working capital and a virtual CFO sure would be a help to everyone in this regard.
5-      Compliances: Having a virtual CFO enables a company to continuously be on the right side of statuary compliances. Last thing an entrepreneur need is any hassle from government agencies!!!
Hope this blog was informative for you. Get further updates on not only Accounting/Book-Keeping/Government Compliances but also about all new rules and regulations/opportunities for funds which will be your industry specific
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1 comment:

  1. Startup Movers is a Company in Delhi for virtual CFO, income tax return etc. with 100% Satisfaction. Contact us-9465653535
    Also click on http://www.startup-movers.com

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