Hiring guide
Fractional CFO for fundraising: a finance readiness checklist
By CFO Index · Published
A fractional CFO can help prepare the financial work behind a fundraise: consistent historical numbers, a model with explicit assumptions and organised responses to investor questions. Agree those deliverables before choosing a provider; an introduction to investors is a separate service.
Start with the funding decision
Write down what the funding is intended to achieve, the expected spending period and the milestones management wants to reach. The British Business Bank notes that finance providers may require different documents and examines preparation around business plans, financial fundamentals and forecasts. Use the requirements of your actual funding route as the starting point. A lender assessing repayment and an equity investor assessing growth will not necessarily ask the same questions.
Reconcile the historical financial information
Before building projections, ask the CFO to identify the latest reliable reporting period and reconcile key figures to the underlying accounts. Clarify the treatment of exceptional costs, founder transactions and unpaid balances. Keep a record of changes made during preparation. Investors receiving different revenue or cash numbers in successive documents need an explanation. The objective is a consistent, traceable set of figures, not a presentation that hides uncertainty.
Build a model around assumptions you can explain
Ask for explicit assumptions about sales, pricing, headcount, operating costs and payment timing. Define a base case and a downside case and explain the decisions each would trigger. Hypothetical example: a hiring plan assumes three new salespeople become productive in four months. A downside case tests a seven-month ramp while retaining their cash cost. The model should show the resulting funding requirement and milestone timing, rather than merely reduce a headline revenue growth percentage.
Organise documents and question ownership
Agree a document list with the intended investor or adviser. Typical preparation topics include historical accounts, current management reporting, a forecast and explanations of material assumptions; the exact requirements vary. Assign responsibility for the current version of each document and for responding to questions. Legal documents and tax positions should be handled by the appropriate qualified advisers. Confirm who can approve access to sensitive company information and who checks a response before it is sent.
Define the CFO's role during the process
Separate preparing the model, attending investor calls, answering follow-up questions and updating the forecast. Ask how many revision rounds and meetings the fee includes, and how urgent requests are handled. Specify who owns the working files after the engagement. Fundraising schedules can move: an agreement should explain how additional months or a change in funding strategy affects the scope. Do not assume a finance-preparation mandate includes investor outreach.
How do you choose a provider?
Look for relevant experience with your business model and the financing process you are considering. Ask the candidate to explain how they challenged an unsupported assumption and how they would handle a gap in your records. Compare proposals using the same outputs and responsibilities. A credible engagement improves preparation and decision-making; it cannot guarantee that an investor will commit or that particular terms will be available.