What are the benefits of a Real Estate CFO?
Real Estate investors are typically eager to scale their businesses quickly and aggressively, changing the finance needs for their business overnight. The finance support for an investor with 1-3 properties is completely different than the support needed for an investor with 5-8 properties or more. And so what does a scaling real estate investor need in order to continue to scale confidently? A Real Estate CFO (Chief Financial Officer)!
The most common question I get asked in the Real Estate Investing community is "what is a Real Estate CFO?" This is completely on target for an industry that hasn't had much exposure to the concept of a fractional CFO. A CFO is an executive who is responsible for managing the financial actions of an organization. Not every business has the financial capability to hire a full time CFO, so a fractional CFO helps you get access to the high-level financial expertise at a fraction of the cost. Add in the benefits of your CFO being a real estate investor and you have a wining combination perfectly suited to your Real Estate Investing business.
To shed some light on what a Real Estate CFO can bring to your business, here are my top 5 benefits of working with a Real Estate specific fractional CFO:
1. Strategic Guidance
You partner with a Real Estate CFO who understands the industry and can provide strategic guidance; helping your business make informed decisions, set financial goals, and develop long-term plans.
2. Financial Efficiency
A Real Estate CFO can help optimize processes, implement cost-saving measures, and identify areas where your business can improve profitability by using strategies such as Profit First for Real Estate Investing.
3. Risk Management
With specific real estate expertise, a Real Estate CFO can help identify and mitigate financial risks; ensuring that your business is better prepared to navigate economic challenges and uncertainties. This may include setting up reserves for future planned and unplanned expenses, creating a debt paydown plan and forecasting cash flow to ensure all obligations will be met.
4. Improved Decision-Making
A Real Estate CFO can help your company make data-driven decisions that lead to better financial outcomes. This means doing more of what works and less of what doesn't. This is crucial when you're scaling fast and need to be clear on what actions should be repeated.
5. Scalability
As your business grows, you can easily adjust the level of CFO support to meet changing demands and the future outlook of your business. Looking to be fully hands off with your finances so you can focus on the areas of your business that you provide the most value and enjoy? No problem!
I might be a little bit bias, but as you can see the opportunities are endless! The question is not really what can a Real Estate CFO offer? But more, what would you like to achieve? The right financial partner for your business will help you get from point A to point B. And that is the true test of a successful partnership.
If you're a scaled real estate investor and thinking about working with a Real Estate CFO, book a Discovery Call with us and let's talk further on how we may be able to safeguard your finances while you scale your business!
