As organisations increasingly seek agile, expert-led solutions to their leadership challenges, the demand for Fractional CFOs is rising rapidly. We recently hosted our latest Interim CFO Roundtable event, offering a valuable lens on this growing trend. Director, Derek Lauder shares key insights from the event below.
The roundtable brought together Scotland-based Interim and Fractional CFOs, each with experience spanning diverse sectors including Technology, Manufacturing, Professional Services, Energy, Financial Services, Facilities Management, Healthcare, and Start-ups. The discussion commenced with a focus on the accelerating growth of the Fractional CFO model in Scotland. In particular, high-growth SME business founders and business owners are increasingly recognising the substantial benefits of engaging a Fractional CFO, which include:
- A highly cost-effective method of accessing senior-level expertise, but at a fraction of the cost, as they are only engaged 1, 2 or 3 days per week – or even less in some cases
- The impact of engaging a Fractional CFO is often immediate, and due to the role’s flexibility, it can scale in line with business growth
- Business owners can move the requirement up or down by agreement with the Fractional CFO
- Access to the typically extensive network of a Fractional CFO can offer commercial advantages. Many have a track record in Private Equity fundraising, which can be particularly valuable
- Cash flow is frequently the biggest challenge for scaling businesses, and a skilled Fractional CFO can be invaluable during periods of growth
- A Fractional CFO can also serve as a mentor or support figure to the wider finance team
Jamie Livingston, Group CEO of Livingston James, recently wrote in The Scotsman about the broader emergence of the Fractional model in Scotland, signalling that this is no longer a trend limited to finance professionals but a significant shift at the strategic leadership level. The roundtable also explored why the model appeals to senior finance professionals. Many experienced Finance Directors and CFOs are now actively seeking portfolio careers that offer improved work-life balance, flexibility, and variety. Notable points of discussion included:
- Opportunities for Fractional CFOs arise from various sources, such as personal networks (firms, banks), Private Equity contacts, LinkedIn, recruitment consultancies, other Fractional CFOs, and membership bodies (e.g. Institute of Directors)
- Ideally, a Fractional CFO would work with no more than five clients at any one time
- Several remuneration models were discussed: operating via a limited company on a day rate, charging a retainer, or working at a reduced rate in exchange for a success bonus or equity stake
The conversation then moved to the Interim FD/CFO market in Scotland, which, while not expanding at the same rate as in the south of the UK, is nonetheless seeing steady growth. Participants emphasised the importance of visibility, reputation, and demonstrable success when operating in this competitive and evolving space.
We extend our thanks to all the participants who shared their experiences and contributed to such a compelling discussion. If you would like to learn more about the Interim and Fractional CFO landscape in Scotland, please contact [email protected].
