Entrepreneurs, mainly from small and medium scale business as well as startups face a key headwind in managing cash flows and finances. Neither can they afford a full time Chief Financial Officer to oversee the functions. Mumbai-based firm SuperCFO, with its 20-member team who are from chartered accountancy and MBA Finance background, tries to address that challenge by providing freelance CFOs or virtual CFOs to these firms.
“The concept was very simple that SMEs would want a good CFO to help them, but they would not typically need a full time CFO because they do not have adequate budget and they do not have so much work for a good high end CFO to be busy with,” Bhairav Kothari, Managing Director, SuperCFO, says. He said the company started with solution called virtual CFO where CFO would go once a week, twice a week, thrice a week depending on the size and stage of the company. “As the company grows the virtual CFO time and effort would be increased and once the company becomes big we will help them have a full time CFO and see through the transition phase and step out”.
Mr. Kothari started SuperCFO eight years ago. Prior that he had stints at CBay Systems, a medical transcription company and also Gruh Finance Ltd. SuperCFO counts Ola Cabs, Stayzilla, Capillary Technologies, private equity firm Matrix Partners, among others as its major clients.
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The firm has added several verticals over the last eight years which is focused around the CFO role. This includes helping companies which do not have a good management information system, to create one through one of its member.
Another vertical which SuperCFO has added is interim CFO.
“There could be slightly larger companies which perhaps needed a CFO and had one, but has quit in short notice. Today hiring good talent is extremely difficult,” Mr. Kothari says. SuperCFO provides an interim CFO to fill the vacuum created by exit of current CFO in short notice. The interim CFO would manage the role for 3-6 months and help the company transition various functions as soon as new CFO comes.
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Mr. Kothari says the firm is also getting request from several private equity funds where they have invested in a company, but feel something is perhaps not right or needs strengthening.
SuperCFO also does one time projects such as helping firms going for an IPO or transitioning of entire payroll function from one location to another. On start-up side, Mr. Kothari says the major issue have been having a viable business plan or burning up cash too fast.
“Companies have gotten into situations of significant losses. I have got lot of companies which have raised tons of private equity money and started blowing up money and soon run out of cash, much before they had anticipated. Then we go in and put in lot of measures on cost controls, budgeting, forecasting, accountability,” he adds.
Mr. Kothari sees a big opportunity for his firm with the booming start-up ecosystem and also growing number of small and medium scale enterprises.