What is a fractional CFO and do I need one?

If you’re looking for help with managing your cash flow, optimizing your go-to-market strategy, or maximizing your chance of a successful fundraise, hiring a Fractional Chief Financial Officer (CFO) is a good place to start.

You might be familiar with the role of a CFO, an experienced individual who leads the finances of the company using data-driven strategies. While that insight is critical even at the early stage, often hiring a full-time CFO can be overkill and expensive. That's when hiring a Fractional CFO, also known as an Outsourced CFO, can be a better option. 

What Does a Fractional CFO Do? 

A Fractional CFO manages the strategic finances at a company, including, but not limited to: 

• Creating a 3-statement financial model & annual budget 
• Managing cash flow (and burn, if applicable)
• Forecasting revenue, expenses, & cash flow 
• Identifying & tracking key performance indicators (KPIs)
• Evaluating the impact of different scenarios, including a base, bull and bear case
• Optimizing go-to-market strategy (client acquisition cost, pricing, product launch, etc.)
• Reviewing vendor contracts and offering advice during negotiations
• Supporting the creation of investor reports and board presentations
• Developing and supporting fundraising strategies

When Should You Hire a Fractional CFO? 

It's never too early to hire a Fractional CFO. Fractional CFOs work with companies across a variety of needs, including those that are at an earlier stage all the way to more established and mature  companies. Generally speaking, a good time to hire a Fractional CFO is when you want to:

• Gain visibility into the future. A Fractional CFO analyzes historical financial reports and uses their industry expertise to help forecast and model your business.
• Manage cash flow effectively. A Fractional CFO can help manage cash flow and implement cost-saving strategies.
• Raise capital. If you're preparing to raise capital, working with a Fractional CFO is usually a top priority. A Fractional CFO can help you evaluate the pros and cons of funding options, assist with pitch decks, provide investor-ready financial models, and evaluate term sheets.
• Establish scalable financial systems. A fractional CFO can suggest financial management systems and a financial stack that you can implement for sustainable growth. Getting the proper framework now could help your company save time and money later. 

How Should You Build Your Finance Team?

Like we mentioned, it’s never too early to hire a Fractional CFO. Pilot's CFO Services team works with clients across industries including: Technology, SaaS, AI, Consumer Goods & Retail, Professional Services, Healthcare, and more. The experience of a Fractional CFO can help you feel confident in the financial health and data of your company, for today and for whatever may come your way tomorrow. Pilot’s CFO team has helped companies free up to $200K in liquidity and extend runway by over 3 months. 

You can book a complimentary 1:1 session with a Pilot CFO to ask questions and get a feel for what it would be like to work with a Fractional CFO.

What’s Included in a Typical Fractional CFO Engagement?

A fractional CFO engagement with Pilot gives you access to senior financial leadership — without the cost or commitment of hiring a full-time CFO.

It’s built for founders who have the basics covered (or want them covered) but need help making smarter financial decisions as the business grows. Think of it as the bridge between “our books are clean” and “we have a real financial strategy.”

While bookkeeping and traditional accounting focus heavily on recording and reporting historical activity, Pilot’s fractional CFO services are designed to help you plan forward: improving runway, preparing for fundraising, building a forecast you trust, and understanding the financial levers that actually drive your business.

Strategic Financial Planning & Analysis (FP&A)

Pilot’s fractional CFOs help you answer the questions that matter most for growth:

• Are we on track?
• What happens if we hire faster (or slower)?
• How long does our cash last?
• What does profitability actually look like for our business?

A typical engagement includes:

Financial modeling
Pilot helps build dynamic financial models that project revenue, headcount, expenses, and cash flow — and allow you to run realistic “what-if” scenarios. For example:

• What if revenue grows 15% slower than expected?
• What if churn increases next quarter?
• What if we add two sales hires now vs. in six months?

Budgeting and forecasting
Rather than setting a static annual budget that becomes irrelevant in two months, Pilot supports:

• Annual planning
• Rolling forecasts
• Monthly updates based on actual performance

This gives you a living plan that adjusts as your business changes.

KPI and metric development
Pilot helps define and track the most relevant metrics for your business model, such as:

• Burn rate and runway
• Gross margin and contribution margin
• CAC, LTV, payback period
• Revenue retention and churn
• Unit economics by customer segment or product line

And more importantly: your fractional CFO helps you interpret those metrics so they’re useful, not just “numbers on a dashboard.”

Cash Flow & Operational Management

Even fast-growing companies fail because of cash flow problems — not because the product isn’t working.

Pilot’s fractional CFO services help you stay ahead of cash needs before they become urgent.

Cash flow optimization and runway planning
Your CFO support includes ongoing monitoring of:

• Current runway
• Upcoming large expenses
• Timing of receivables and payables
• Hiring plans and their cash impact

The goal is to avoid last-minute surprises and ensure leadership can plan with confidence.

Profitability and margin analysis
Pilot helps you understand what’s actually profitable — and what’s just generating revenue.

That can include:

• Margin breakdowns by product, customer, channel, or location
• Pricing analysis and sensitivity modeling
• Cost structure reviews
• Recommendations for improving gross margin or operational efficiency

Finance operations oversight
A fractional CFO doesn’t just advise — they also help make sure the underlying finance function can support scale.

Pilot can help identify process gaps, improve reporting consistency, and reduce the risk of messy financial operations as complexity grows.

Financial Systems & Your Finance Stack

As your business grows, financial accuracy becomes harder to maintain — especially if you’re duct-taping together spreadsheets and disconnected tools.

Pilot’s fractional CFO support can include evaluating and improving your finance stack, including:

• Accounting systems (like QuickBooks or NetSuite)
• Expense management tools
• Payroll systems
• AR/AP workflows
• Automation and reporting processes

The goal is simple: reduce manual work, improve accuracy, and make financial data easier to use.

Growth, Fundraising & Capital Strategy

This is one of the biggest reasons founders seek fractional CFO support: fundraising is high-stakes, and financial credibility matters.

Pilot’s fractional CFOs help you prepare for capital events and long-term growth.

Fundraising support and investor readiness
This can include:

• Creating investor-ready financial statements and metrics
• Refining your forecast so it holds up under scrutiny
• Supporting due diligence requests
• Helping prepare financial slides for pitch decks
• Answering investor finance questions with confidence

In short: you’re not just “sending numbers.” You’re presenting a financial story investors can trust.

Capital planning and scenario strategy
Pilot helps you model the tradeoffs behind major decisions like:

• Hiring pace vs. runway
• Growth spend vs. profitability
• Debt vs. equity financing
• Expansion timing and cash requirements

This is where CFO-level support becomes especially valuable — because one decision can shift your trajectory for the next 12–24 months.

Board and stakeholder reporting
If you report to investors, advisors, or a board, Pilot can help you deliver consistent, credible updates that include:

• Performance vs. plan
• Key financial highlights
• Updated runway and forecast
• Risks and strategic recommendations

This builds trust and makes board conversations more productive.

Risk Management, Compliance & Financial Controls

As your company scales, the risks change. What worked at $500K ARR often breaks at $5M ARR.

Pilot’s fractional CFO support helps you prepare for that shift.

Internal controls and financial hygiene
This includes setting up processes to reduce risk, such as:

• Approval workflows
• Clear expense policies
• Stronger documentation practices
• Cleaner close processes and audit trails

Audit readiness and GAAP alignment
If you’re approaching a financial audit, raising institutional capital, or planning for an eventual acquisition, Pilot helps ensure your financials are structured correctly and aligned with GAAP expectations.

This often includes:

• Improving close quality
• Cleaning up revenue recognition processes
• Strengthening documentation
• Ensuring financial statements hold up under review

How Fractional CFO Engagements Typically Work

Pilot’s fractional CFO services are designed to be flexible — because the needs of a business aren’t static.

Most engagements fall into one of these models:

Ongoing strategic support (monthly)
Best for companies that need consistent financial leadership and planning. Typical monthly work includes:

• Forecast updates
• KPI reviews
• Runway planning
• Leadership check-ins
• Strategic decision support

Project-based support
Best for specific outcomes, such as:

• Building a fundraising model
• Preparing for due diligence
• Upgrading your financial reporting
• Implementing a new finance system
• Building a board-ready reporting cadence

A Fractional CFO Works Best With Clean Books

A fractional CFO doesn’t replace bookkeeping — they build on it.

Pilot’s advantage is that fractional CFO services sit on top of managed bookkeeping, so strategic guidance is grounded in accurate, up-to-date financial data.

That means:

• No guessing
• No messy handoffs
• No decisions based on outdated numbers

Just clean financials and clear direction.

‍