Why a Strategic CFO Feels Like a Waste of Time - Until It Isn’t

From the perspective of many venture capital investors, hiring a strategic CFO too early can feel like a mistake.

“Why spend hundreds of thousands of dollars a year on a glorified accountant?” they ask. “This company needs engineers and salespeople, not another overhead function. We already have a bookkeeper and a board. Why slow things down?”

On the surface, this argument seems logical.

• CFOs don’t generate revenue. In the early years, every dollar counts. Any role that doesn’t build product, close customers, or improve retention is often seen as a drag on growth.

• They complicate the culture. Startups rely on speed and flexibility. Strategic finance professionals are known for introducing controls, approval processes and risk aversion — things founders often view as barriers.

• You already have coverage. A competent controller, an external accountant, and an engaged board seem sufficient to keep the company compliant and solvent at this stage.

Some highly successful technology companies have grown to billion‑dollar valuations before hiring a formal CFO. Canva, for instance, waited seven years before making its first appointment. Surely that is proof you can wait?

This is the investor’s case against hiring a CFO. But when viewed through the lens of evidence and outcomes, the story changes.

What Strategic CFOs Actually Do

A strategic CFO does not simply keep the books. Their role is to identify risks others cannot see, frame trade‑offs, and protect value at moments when the cost of mistakes is greatest.

Here are four reasons why hiring a strategic CFO at the right time can protect far more value than it costs.

1. Cash Burn is Almost Always Underestimated

One of the most common reasons startups fail is that they run out of cash sooner than expected. According to CB Insights, 38% of failed startups cited running out of cash as the primary reason for closure (The Top 12 Reasons Startups Fail, 2021).

Early‑stage companies often project runway in a straight line, assuming next quarter will resemble this quarter. In practice, costs tend to rise faster than expected as scale adds complexity, management layers, and infrastructure.

A strategic CFO can build more realistic scenarios, quantify risk properly, and ensure capital is allocated where it creates the most runway extension.

2. The Funding Window Can Close Without Warning

It is easy to believe the next round of funding will always be available, so long as growth continues. But market conditions change quickly.

PitchBook’s 2024 research found that flat and down rounds in venture capital rose to their highest level in a decade, making up 28.4% of all VC deals in the first half of the year (Down Rounds at a Decade High, June 2024). The prior year already showed a sharp reversal from historic highs.

When the funding environment contracts, companies without disciplined cash management or a capital strategy often find themselves forced into unfavourable terms — or unable to raise at all. Strategic CFOs help time fundraising, maintain flexibility, and avoid being forced into bad decisions.

3. Poor Financials Damage Valuation

When it comes time to raise a significant round, sell the company, or go public, weak financial data and controls can erode value.

Deloitte’s 2022 Global Private Equity Survey found that 85% of private equity investors reduced purchase prices or walked away from deals because of poor financial reporting or inadequate quality of earnings uncovered during due diligence.

Even at growth stage, many companies lack the reporting, controls, and forecast credibility required under scrutiny. These gaps tend to become visible just when they can do the most damage.

4. The Value at Risk is Far Greater Than the CFO’s Cost

While a strategic CFO can be expensive in absolute terms, their cost is modest compared to the value they preserve. A poorly managed funding round, a down round, or a failed sale can wipe out tens of millions in shareholder value. The cost of strategic finance capability is small by comparison.

Why Canva’s Choice Matters

Some point to Canva as proof that a CFO can wait. The company launched in 2013 and did not appoint its first CFO until 2016, after reaching significant scale. But what is often overlooked is that Canva did not promote someone internally to the role — it hired Damien Singh, an experienced external finance leader with a proven track record elsewhere.

This was not just about compliance. It reflected a recognition that even at that stage, Canva needed external perspective, credibility with investors, and someone able to professionalise the finance function to support its growth trajectory.

Startups rarely develop the kind of strategic finance mindset internally that a seasoned CFO brings. The skills required — managing investor expectations, preparing for due diligence, structuring capital intelligently, and installing scalable controls — are learned through experience in similar high‑stakes environments.

The Takeaway

From the outside, delaying the hire of a strategic CFO can seem prudent. After all, the company has grown to this point without one.

But the evidence shows that companies which integrate strategic finance at the right stage are better equipped to survive downturns, raise capital on better terms, and defend their valuations when it matters most.

Strategic finance does not slow growth. It protects it.

At CFOPartners, we help founders and boards bring CFO‑level capability into the business at the right time, and in a way that suits the company’s stage and goals. Because sometimes, the most expensive hire is the one you never made.