Startup CXO

Chapter 17Other Areas to Partner With

While Sales, Service, Marketing, and Legal are the areas where a startup CFO can make a big impact immediately, the scope of your responsibilities are company‐wide and you can make Finance a valuable partner to the entire company. Here are some tips on what you can do that will help your company go from average to great.

• Budgeting. For a startup, the budget is used to help determine resource decisions. Sure, it is always helpful to compare actual vs. budgeted revenue (and bookings), but for many startups, the budget is what drives investments in areas like new hires, marketing, and other material spending. And, of course, it is critical to use for cash forecasting. As you progress during your fiscal year, how you are doing against your budget will drive your allowable expenses, especially new hires. So, you will want to establish a formal budgeting process as soon as reasonable. For a startup, the process should include the following:
  • Building the budget. You should work with the other group heads and all those who will have control of spending and sales. Building a simple template for people to fill in sales and spending assumptions as appropriate will make this work much easier.
  • Budget review. Once you have a budget, and have it approved at a Board meeting, you should review it monthly with the team. Transparency with the team and the Board on how you are doing vs. expectations, and why, is a critical part of scaling. This Actual vs. ...