How to Recruit a CFO

The most common mistake in a CFO search is hiring the finance director you needed three years ago. The seat changes at every stage of a company, and the brief usually lags the business by a funding round.

Decide which CFO you need

StageWhat the seat ownsWho fits
Pre-Series ARunway, model, first controlsA fractional CFO, almost always
Series A to BThe raise, board reporting, unit economicsFirst full-time CFO, or fractional through the raise
Series B to DScale, systems, a finance teamA CFO who has built a function, not just run one
Pre-exitDiligence, working capital, the processA CFO who has been through one

What the fully loaded number is

A UK CFO at £150,000 base costs roughly £172,000 once employer National Insurance and pension are in, before bonus or equity. Add a retained search fee at 30 per cent and the first year is around £217,000.

That is the number to compare against alternatives, not the salary.

Three questions that actually separate candidates

  • Walk me through a forecast you got wrong. What did you miss, and what did you change afterwards? Anyone senior has one, and the ones who cannot name it have not owned a number.
  • Describe a time you told a founder or a board something they did not want to hear. The job is largely this.
  • What would you stop doing in your first month? Tests whether they have a view or a checklist.

When fractional is the better answer

If the honest requirement is two days a week of judgement rather than five days of a full-time officer, a fractional CFO fills the seat at a fraction of the loaded cost and can start in days rather than in six months.

The two are not exclusive. A fractional CFO covering the seat while a permanent search runs is the normal way to avoid a six-month hole, and it is why both sit on this site.

Questions

How much does it cost to recruit a CFO?
A retained search is 25 to 33 per cent of first-year earnings in the UK, so £37,500 to £49,500 on a £150,000 seat, plus VAT. The loaded cost of the hire itself is roughly fifteen per cent above salary before bonus.
Should I hire a fractional or full-time CFO?
Full-time when the seat genuinely needs five days and the company can carry the loaded cost. Fractional when the requirement is judgement rather than hours, or while a permanent search runs.

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