The era of the part-time CFO has arrived: these financial leaders apply their unique skills to multiple companies with flexible working hours. As such opportunities increase, financial leaders looking to transition into part-time CFO roles need to ensure they are fully prepared.

Before taking on such a role, a key step is to "define what value you can bring and where your expertise lies," says Michelle Delker. She is the founder of The William Stanley CFO Group, a boutique part-time CFO and financial services firm based in Wesley Chapel, Florida.

Find your niche

Although some may think the CFO role is "one-size-fits-all," the reality is far from it. Each leader brings a unique background and experience—Delker compares this to choosing a restaurant: two may both offer Japanese or Italian cuisine, but specialize in different regions or cooking styles.

"Some people have excellent public accounting backgrounds, and perhaps they are best suited to assist with stock or IPO transactions, helping organizations that need to go public," she said in an interview. "Others may be turnaround experts, skilled at handling liquidity issues. So I think the first step is to define what you are truly good at and what gap you can fill in the market."

She also emphasized that before signing on for a part-time CFO role, it is crucial to thoroughly understand the company, its strengths, and its challenges, and to ensure there is "a very clear plan and path forward." Delker, who founded the William Stanley CFO Group last year, typically conducts 10 to 12 hours of due diligence before preparing an engagement offer for a company.

Because of this upfront work (which Delker does not charge for), she "is able to clearly define the scope of services where she can add the most value, then gain alignment or consensus from leadership, and price the engagement accordingly," she said.

Financial professionals considering part-time CFO work must also be prepared to adapt to a new way of working: some executives may thrive on the flexibility and diverse experience, said Dan DeGolier, CEO and founder of Ascent CFO Solutions, a part-time CFO firm based in Boulder, Colorado, in an interview.

"You can almost think of it as putting your career into overdrive," DeGolier said. He began his career in public accounting and held various financial leadership roles before founding Ascent in 2011. "Because if you are working with three or four companies as a CFO, you gain many different types of experience."

That said, the nature of part-time CFO work is not for everyone; "not everyone can easily switch tasks" when it comes to working with companies with different needs, DeGolier said. On the other hand, this challenge, along with the ability to add value to companies using one's unique skills, is one of the main attractions for leaders choosing part-time CFO roles, especially as companies begin to look for financial leaders withbroader skill sets.

"I think you will find that for people at this stage of their career, the focus is not on collecting compensation," Delker said. "It's about providing value and bringing in that leader to reach the next level."

Pricing the service

Having a deep understanding of your expertise is crucial, but when entering the booming part-time CFO field, knowing your own value is equally important, especially as more companies begin to consider thebenefits of hiring such leaders.

Part-time CFOs come into play when a company "may only need the professional's time for 20 or 30 hours per month," Delker said—which distinguishes them from interim executives (who serve in temporary but full-time roles)—and hiring a part-time CFO can save small businesses significant costs. According to data from Helm, a cash flow forecasting provider, this can save companies approximately $60,000 in expenses annually.

Rates for part-time or fractional CFOs can vary, but they are typically billed hourly, ranging from $200 to $350 per hour depending on location, Helm said. In comparison, the average annual salary for a full-time CFO is approximately $160,000,according to ZipRecruiter。

For example, part-time CFO Brendan Maaghul left his investment banking career during the pandemic to take on such work, and he charges a fixed monthly fee, typically between $6,000 and $8,000 per month, he said.

Maaghul ultimately chose part-time CFO work partly because market volatility made focusing on multiple companies a more stable option, he said. He primarily works with startups or early-stage companies that are just beginning to "have regular board meetings and board updates, where investors now require various operational metrics and financial metrics to understand the status of their investments," he said in an interview.

Client relationships begin with an initial four-month engagement, he said, which is the shortest time he works with clients. Maaghul typically works with three to four clients simultaneously, he said.

Billing methods for part-time CFOs also vary from person to person, he said—while a project-based model (for example, where a CFO is compensated for delivering a financial model) may suit some, "for me, that feels a bit transactional," he said.

Read the fine print carefully

As such opportunities grow, another key first step for aspiring part-time CFOs—similar to interim executives and other part-time executives—is to do their homework and transparently understand what they are being hired to do, said Robert A. Adelson, an executive employment attorney.

This understanding should be clearly written into the contract between the executive and the company, Adelson—who representsthe interests of executives including CFOs, CEOs, and CTOs—said in an interview. If there is vague language in the contract, such as "'you will perform the duties of the interim CFO, along with all duties related to that position, and other duties as assigned by the CEO,' then you are in trouble," Adelson said. "You have no protection at all."

Candidates for part-time positions should also ensure they pay attention to potential liabilities they may face as non-permanent employees of the company and ensure these are covered in the contract. Additionally, clearly outlining responsibilities can create more room for executives to negotiate matters such as compensation and bonuses.

"If you are brought in for a specific purpose, you can use that opportunity to negotiate a special bonus for yourself," Adelson said, whether in cash, equity, or other rewards.

Executives seeking part-time roles can form a limited liability company or consulting firm to take on part-time or consulting work, Adelson said.

Being transparent from the start is crucial to building a strong relationship with a company: for Delker, the biggest red flag when considering a potential engagement is "if the owner or CEO is consistently dishonest or trying to mislead," she said via email.

"Financial data will tell the truth. Good professionals will see the facts. It's one thing for a leader to be misled, but it's another thing entirely for there to be blatant dishonesty," she said. "For a partnership to be successful, the CEO must be willing to provide complete transparency. They must be open and honest. Otherwise, the engagement will be a constant uphill battle."