Advancing to the role of Chief Financial Officer (CFO) in a startup or scale-up environment requires more than just financial expertise.

It’s a dynamic road that calls for adaptability, strategic thinking, and a proactive approach to leadership.

Transitioning from a finance leader to a startup CFO involves mastering new skills, embracing a forward-looking mindset, and understanding the unique demands of a high-growth environment.

Here are five essential steps to guide you in navigating the path to becoming a CFO in a startup or scale-up.

1. Embrace a Strategic Mindset

In a high-growth environment, finance leaders are expected to be strategic thinkers. Unlike in more traditional corporate roles, the startup CFO is not just about managing the numbers but about aligning the company’s financial direction with its overall strategy.

To make this mindset shift:

• Think Big Picture: Instead of focusing solely on historical data, develop the ability to connect financial performance to future business outcomes. This may include understanding market trends, anticipating financial challenges, and contributing to the strategic planning process.
• Be Proactive: Rather than waiting for issues to arise, anticipate potential financial roadblocks and work with the leadership team to address them before they become critical.
• Focus on Growth: High-growth startups are often in a constant state of flux. A strategic CFO must focus on supporting rapid growth while keeping an eye on sustainable practices.

2. Cultivate Strong Cross-Functional Relationships

Building strong relationships across departments is essential for any aspiring CFO in a startup or scale-up. Unlike larger companies where finance functions can be more siloed, startups require finance leaders to work closely with other teams such as marketing, product, and operations.

To cultivate effective cross-functional relationships:

• Collaborate Actively: Be involved in meetings with other departments and take an active interest in understanding their challenges and objectives.
• Speak the Language of Other Teams: Avoid technical jargon and instead learn to communicate financial insights in a way that resonates with non-financial stakeholders.
• Build Trust: Building rapport with other departments fosters collaboration and ensures that finance is seen as a valuable business partner rather than just a gatekeeper.

3. Develop a Forward-Thinking Approach to Financial Management

A startup CFO needs to go beyond traditional financial management to embrace a forward-thinking approach that supports innovation and rapid growth. In a high-growth environment, being agile and adaptable is essential.

Here’s how to take a forward-thinking approach:

• Focus on Cash Flow Management: Cash flow is the lifeblood of startups. Ensure there are accurate forecasts in place to manage short-term and long-term cash needs, especially during fundraising cycles.
• Embrace Technology: Invest in the right finance tools and software to streamline processes, automate routine tasks, and provide real-time financial insights. Leveraging a strong finance tech stack allows you to focus more on strategic decision-making and less on day-to-day operations.
• Scenario Planning: High-growth companies often face uncertain futures, and it’s crucial to be prepared for various scenarios. Regularly review and adjust forecasts, and work on creating multiple projections that reflect best-case, worst-case, and expected scenarios.

4. Prioritise Leadership and Team Development

As a CFO, you will lead the finance team and be expected to build a high-performing unit that supports the broader business. In startups and scale-ups, finance teams are often lean, so developing and empowering your team becomes crucial.

To be an effective leader:

• Invest in Talent: Identify high-potential team members and support their professional development. Ensure they have access to continuing professional development opportunities to keep up with industry changes and enhance their skills.
• Empower Autonomy: Delegate effectively and give your team the space to take ownership of their work. This allows you to focus on strategic issues while building a capable and resilient team.
• Encourage a Learning Culture: Foster an environment where mistakes are viewed as learning opportunities. Startups are fast-paced and experimental by nature, so it’s essential to build a team that isn’t afraid to innovate and adapt.

5. Refine Your Fundraising and Stakeholder Communication Skills

A key responsibility of a startup CFO is to secure funding and communicate effectively with investors and other stakeholders. Fundraising can be one of the most challenging aspects of a CFO’s role in a high-growth environment, as it requires both strong financial acumen and the ability to build trust with potential investors.

To succeed in this area:

• Understand the Fundraising Landscape: Familiarise yourself with the different types of fundraising options available, including venture capital, private equity, and convertible loan notes. Knowing which is best suited for the business at each stage will enable you to make informed decisions and present them to the founder.
• Craft a Compelling Story: Investors want more than numbers; they want a story that shows the company’s potential for growth and return on investment. Work with the founder and CEO to create a coherent narrative that aligns with the company’s financial projections.
• Communicate Clearly and Regularly: Investors need regular updates on the company’s progress. Developing a structured approach to investor relations, such as monthly or quarterly updates, helps to build confidence in the business. Your communication should be transparent, clear, and concise, providing investors with the insights they need without overloading them with details.

Becoming a CFO in a startup or scale-up requires a combination of technical skills, strategic insight, and interpersonal acumen. It’s about making the transition from financial manager to strategic leader, from numbers-focused professional to visionary partner. 

If you’re an aspiring finance leader looking to take the next step, consider investing in resources and training that support your growth. Our Financial Leadership Fundamentals course offers the tools, insights, and practical guidance you need to excel in the fast-paced world of startups and scale-ups.

If you want to make your finance career progress easier & faster, follow the steps via our Framework below:

1. Sign up to our next workshop.
2. Work with me in the Financial Leadership Foundations course  that includes monthly Q&A sessions where we can discuss all of your questions and how to apply your learnings to your current role. 
3. Download the Advanced Management accounts course to showcase your skills as a finance leader to the Founder, leadership team and the Board.
4. Book at FLF Career Planning session.