How Much Does a Virtual CFO Cost?

Once your business exceeds around $2 million in revenue, a Chief Financial Officer, or CFO, becomes increasingly necessary. Multiple factors come into play that make the financial side of your business more complicated: banking, taxes, revenue recognition, forecasting, and budgeting, to name a few.  

The joy of generating more revenue often morphs into frustration when basic bookkeeping and traditional CPA services aren’t enough to level up your business. This is where most companies start exploring CFO services, only to realize that the cost of hiring a traditional CFO can be a little daunting. 

That said, your business may be in that sweet spot where outsourcing your accounting and advisory needs makes the most sense for your budget. There’s a huge difference in how much you’ll pay for a virtual CFO versus a full-time CFO. Hiring a virtual CFO allows you to get the benefit of a CFO’s expertise without having to compromise on your business needs, all while making sure you keep within your desired business costs for talent. 

How Much Does a Virtual CFO Cost?

Since we don’t believe in couching the details behind a booking link, here’s the golden nugget:

• The average cost to hire a virtual CFO from Summit Virtual CFO by Anders is $78,000. 

• Comparatively, the average salary for a CFO in the US is just over $228,000, keeping in mind that that’s just the base salary and doesn’t include other employment costs.

Will I get 3 times as much value out of a full-time CFO? The answer is likely no. And that comes down to the type of services you get when you work with a virtual CFO.

What Comes with the Cost of a Virtual CFO?

We break virtual CFO services into three categories:

• Transactional 

• Controller 

• Virtual CFO 

  
  

The pricing scales with the company size and revenue. Additionally, each package includes a more comprehensive list of services. 

You can see a full breakdown of the services offered at each price level below.

Is a Fractional CFO Cheaper Than a Virtual CFO?

There’s some confusion in the market right now about how a fractional CFO and a virtual CFO differ (and of course, whether their costs are different, as well). Here’s some good news for you: a virtual CFO and a fractional CFO are one and the same. 

But why the sudden attention on fractional CFOs? 

Two words: Global pandemic. 

As much as we’d like to put the pandemic behind us, its effects are still reverberating across the business world and could potentially impact how much you pay for a virtual CFO.  

Simply put, there are far more people striking out independently and offering their services as independent contractors or consultants. That’s what the virtual CFO role is by nature: A highly-skilled consultant who takes a targeted, needs-based approach to filling a distinct need for financial leadership. 

Two data points highlight this market change. 

• In its 2023 State of Independence report, MBO Partners found that the number of independent contractors in the US increased by 89%.

• Google Search volumes for “fractional CFO” have increased by over 350% since 2020.

  

Notably, 63% of individuals working as independent contractors say they’re doing it by choice, meaning it’s not entirely driven by a competitive job market. That has a significant consequence on hiring qualified CFOs full-time.  

The pool of qualified CFOs who want to work full-time is smaller, ultimately increasing the cost of hiring individuals who want to work in that capacity. And that assumes you can find the right person to hire at all.  

Underlining that data: CFO turnover rates are at an all-time high.  

This puts mid-sized businesses that need qualified and cost-effective CFO services in a pinch. The best CFOs on the market who are willing to work full-time are few and far between. Most will go to larger companies with more extensive hiring budgets.  

Your need is still there, however. And thankfully, virtual CFO services answer that need. Whether you want to call them fractional or consultants, part-time CFO services allow you to access critical financial accounting, reporting, and forecasting services without the high costs associated with full-time CFOs (and without the added cost and risk of turnover). 

How to Explore Virtual CFO Costs

The cost of a full-time CFO can feel painfully out of reach for many small or mid-sized businesses. The importance of the role means you don’t want to run the risk of making a poor hire. Yet the need only grows as the size of your company and your revenue increases. 

Virtual CFO services are a cost-effective alternative to a full-time CFO. With the average cost coming in at around $78,000, you’ll save money while still getting expert access to financial services your business can no longer live without.
Do your needs best fit into our Transactional, Controller, or Virtual CFO packages? Or, does an a la carte approach make the most sense for your needs? Reach out and let us know what fits into your budget with a free virtual CFO consultation.