When does a start-up need a fractional CFO?

The trigger is often a decision, rather than a particular turnover level: committing to several hires, raising investment, launching a paid product or negotiating a large contract. Founders need to see the cash consequences before making commitments that are difficult to reverse.

If the immediate gap is bookkeeping or tax compliance, allocate that work first. Senior finance support is most useful when there is a clear decision to analyse and enough information to build a defensible starting point.

Calculate runway, then test the cash timing

A rough runway estimate divides available cash by monthly net cash burn. That shortcut assumes burn stays constant and all cash is available. It can miss recruitment costs, annual subscriptions, tax dates, restricted balances and uneven customer receipts.

Hypothetically, £240,000 divided by £30,000 monthly net burn gives eight months. An additional £60,000 one-off payment reduces the cash available for that same ongoing burn to £180,000, or six months. A month-by-month forecast is needed when payments vary. These are illustrative figures, not a recommended cash buffer.

Connect the budget to evidence and milestones

Separate committed spending from spending that depends on a decision. Give each planned hire or launch activity a start date, cash cost, owner and milestone. For pre-revenue businesses, customer interviews and a pipeline can inform assumptions, but neither should be presented as contracted revenue.

Build a base case and a slower-progress case. Ask what happens if a pilot converts later, a recruitment process costs more or a funding round closes after the expected date. Agree when to revisit the plan and what evidence would change it.

Prepare a coherent financial story for funding

A funding model should connect the amount sought to cash needs, milestones and an operating plan. Keep a record of assumptions and reconcile opening balances with the accounts. Explain the difference between historical results, committed contracts and forecasts.

We can discuss a model, cash plan and supporting schedules under a funding preparation scope. Investment valuation, legal documents and tax scheme advice require their own agreed responsibilities. Funding is not guaranteed.

Start-up CFO support that fits your stage

  • Initial review of available cash, commitments and records.
  • A practical forecast with explicit assumptions and scenarios.
  • A short reporting routine focused on runway and milestones.
  • Decision support for hiring, pricing or fundraising.

Bring the latest accounts if available, bank balances, existing commitments and your next major decision. You do not need a polished investor deck to enquire. A defined project may be appropriate before ongoing support; scope and fees are agreed individually.

Your questions, answered.

Can you help a pre-revenue start-up?

Yes. The work can focus on cash commitments, milestone planning and scenario assumptions. A forecast does not remove the uncertainty around future demand.

Do I need a full-time CFO?

Not necessarily. Consider the decisions, workload and internal team. Fractional support can provide defined senior input before a full-time role is justified.

Will you replace my accountant?

Responsibilities are agreed with your existing team. Bookkeeping, statutory accounts and tax work are not automatically included in a fractional CFO engagement.