Fractional CFO for Established Businesses: When It Makes Sense

Senior financial leadership without the full-time cost—a growing model for mid-market companies.

Last Updated: March 2025|10 min read

Key Takeaways

•Fractional CFOs provide senior strategic finance at 25-40% of full-time CFO cost
•Most effective for companies with $5M-$30M revenue needing 10-30 hours/month of CFO time
•Common use cases: PE preparation, M&A support, strategic planning, board-level finance
•Not a permanent solution for all—plan for eventual full-time hire as complexity grows

The fractional CFO model isn't just for startups burning through VC cash. Increasingly, established businesses with $5M-$50M in revenue are discovering that fractional CFO services provide exactly what they need: senior financial leadership without the $300K+ cost of a full-time executive.

This guide explains when the fractional model makes sense for established businesses, what to expect from the engagement, and how to evaluate whether it's right for your company.

What Fractional CFOs Do for Established Businesses

A fractional CFO provides the same capabilities as a full-time CFO, just on a part-time basis. For established businesses, this typically means:

Strategic Financial Planning

Long-term financial models, scenario analysis, strategic planning support, and capital allocation guidance.

Board & Stakeholder Management

Preparing board packages, attending board meetings, managing investor/lender relationships, and stakeholder communication.

PE/M&A Preparation

Getting financials ready for due diligence, supporting QoE processes, and maximizing company value for transactions.

Financial Operations Oversight

Upgrading finance processes, improving close times, implementing controls, and overseeing the finance function.

Typical Engagement Scope

Activity	Monthly Time	Description
Monthly financial review	4-6 hours	Review financials, identify issues, provide insights
Leadership meetings	2-4 hours	Strategic discussions, planning sessions, executive team
Board preparation	4-8 hours	Board package prep, attendance, follow-up (if board meetings)
Ad hoc strategic support	4-8 hours	Analysis, modeling, special projects, questions
Finance team oversight	2-4 hours	Guiding controller, reviewing processes, team development

When Fractional CFO Makes Sense

The fractional model works best in specific circumstances. Here's when to consider it:

You need strategic guidance, not full-time presence: 10-30 hours per month of CFO time meets your needs. You don't have enough work to justify a full-time executive.

You have a capable controller: Day-to-day accounting is handled. You need someone for strategy and oversight, not operations.

You're preparing for a specific event: PE investment, acquisition, major financing, or audit. Project-based CFO expertise makes more sense than permanent hire.

You want to test before committing: Using a fractional CFO helps you understand what you actually need before making a $300K+ hiring decision.

Revenue is $5M-$30M: You've outgrown controller-only finance but aren't quite at the scale where full-time CFO is clearly justified.

When Fractional May NOT Be Right

Consider full-time instead if: you're PE-backed with heavy reporting requirements, you need dedicated presence for capital-intensive operations, you have complex multi-entity structures requiring constant attention, or you're actively in an M&A process (not just preparing).

Cost Comparison: Fractional vs. Full-Time

Factor	Fractional CFO	Full-Time CFO
Annual Cost	$60,000 - $180,000	$250,000 - $400,000+
Hours/Month	15-40 hours	160+ hours
Equity Required	None	Typically 0.5%-2%
Commitment	Month-to-month typical	Long-term employment
Ramp Time	2-4 weeks	3-6 months search + onboarding
Experience Breadth	Multiple companies/situations	Deeper single-company focus

The Math for Mid-Market Companies

A $15M revenue company might pay $120K/year for a fractional CFO (20 hours/month). The same company would pay $300K+ for a full-time CFO (salary, benefits, equity). The fractional model provides 60% savings while delivering the strategic guidance the business actually needs at this stage.

Engagement Models

Fractional CFO engagements come in several formats:

Monthly Retainer (Most Common)

Fixed monthly fee for a set number of hours. Provides predictable cost and consistent engagement.

Typical range: $5,000 - $15,000/month for 15-40 hours

Project-Based

Fixed fee for specific projects: M&A preparation, PE readiness, system implementation, audit support.

Typical range: $15,000 - $75,000 per project depending on scope

Hourly (Less Common)

Pay-as-you-go for ad hoc needs. More expensive per hour but offers maximum flexibility.

Typical range: $250 - $500/hour

Evaluating If It's Right for You

Ask yourself these questions to determine if fractional CFO makes sense:

Do you need CFO-level thinking more than 5 hours but less than 40 hours per week?

Is your accounting function stable enough that it doesn't need daily CFO attention?

Would you benefit from pattern recognition across multiple companies?

Is capital allocation a concern that makes the 60%+ savings meaningful?

Can you benefit from quick access to expertise without a 6-month hiring process?

If you answered yes to most of these, fractional CFO is likely a good fit for your current stage.

Related Resources

Scaling Finance Guide

Complete guide for $5M-$50M companies

Controller to CFO

Understanding the strategic finance gap

Interested in Fractional CFO Services?

Eagle Rock CFO provides fractional CFO services for growing companies. Let's discuss whether it's the right fit for your business.

Schedule a Consultation