Are you thinking about starting a Fractional CFO firm in 2025? Or maybe you started your Fractional CFO firm in the past year or so?

If so, I want you to be careful. Social media has propagated a lot of myths about what it takes to be a successful Fractional CFO, and these myths will end up slowing you down and costing you money if you're not careful.

I should know - I bought into most of these myths myself, and they came with a pretty high price tag:

Burnout
Self-doubt
Slow revenue growth
Endless wasted profitability

In today's edition, I'm going to share 7 common myths plaguing the Fractional CFO industry. My hope is that you'll be able to avoid buying into some of these myths so that you can scale faster, more profitably, and with a smile.  

Let's dive in.

Myth 1: The Full Suite Fallacy

If you want to offer Fractional CFO services, you'll have to also offer an entire suite of other services as well:

Tax
FP&A
Treasury
Accounting
Bookkeeping
Controllership

I don't know about you, but I told myself this story for years. I had myself convinced that no one would want JUST advisory. The market would certainly DEMAND that I offer the full suite of services.

And so that's what my firm did. We offered the whole suite.

Truth be told, this was extremely demoralizing for me and my team. We had no interest in offering anything other than CFO services.

The compliance work, while extremely important, just didn't get any of us excited to come to work and do our very best every day. But we did it anyway because we had to.

Right?

After slogging along for a few years, I finally had enough.

I decided to take a MAJOR gamble and no longer offer anything but CFO services. 

We lost 83% of our revenue overnight and didn't land another client for nearly 2 years. I took a job at 7-11 to make ends meet. My family disowned me.

Just kidding.

Reality:

As it turns out, the market is completely fine with you offering whatever services you want - just love what you do offer.

My firm hasn't offered anything but CFO services for years now and we're doing just fine. I can point to dozens of other 6- and 7-figure firms in the same boat.

There's nothing wrong with offering bookkeeping or tax services in addition to CFO services. But life is too short to do work you don't love.

Myth 2: If You're Not The Best CFO, Then Get Out!

This is one of the most pervasive myths I hear from people considering the move into becoming a Fractional CFO - and it kills me.

It goes something like this:

Michael, I've never been the full-time CFO of a major company. All of my experience has been with smaller businesses. I don't know that I'm even qualified to do this!

The reality is that you're not applying to be the Fractional CFO of Netflix. In fact, you're probably targeting companies that are under $20MM or even $10MM a year in revenue. 

Reality:

Most clients you're likely to work with have never had any level of financial leadership or financial strategies in place.

I bet you're more than qualified to step in and make a material difference for these relatively smaller companies. 

And they need your help.
Get in the game and work your magic.
 

Myth 3: You Can Grow Off Referrals Alone

Referrals are great! 
They're the hottest leads.
They're likely to close the fastest.
They usually come with the least friction.

But here's the downside (and it's a doozie):
You never know when they're going to come!

My guess is that you have a lot riding on your Fractional CFO firm. The mortgage, the kids' tuition, and the ever-increasing price of a Netflix subscription.

If your firm tanks, the kids don't go to college, and you may never find out what happens on Squid Games Season 2!

The stakes are high, so you can't rely on chance alone for new business. You've got to have a system for prospecting.

If you're new to prospecting, check out Fanatical Prospecting by Jeb Blount. This is my firm's go-to playbook for prospecting.

Reality:

Referrals are great, but if you want predictable growth, you need predictable prospecting strategies.

Myth 4: More Letters = More Success

The most qualified, highest-earning Fractional CFO I've ever met is a lady from Brooklyn named Amanda Snowville, CPA, MBA, CFA, EA. On top of all that, she's currently working on her JD with a focus on tax law.

As a solopreneur, she cleared $9,000,000 topline last year at a 64% net margin!

I asked her how she did it.

Her answer was simple:

I'm not really a solopreneur. I have an entire army of letters after my name. Each and every one of those letters played a crucial role in driving revenue and profitability. Teamwork makes the dream work.

Yes, this story is entirely made up.

But it's born from very REAL questions that I get asked dozens of times each year by aspiring Fractional CFOS.

MBAs ask: Do I need to get my CPA to be able to be a successful Fractional CFO?

CPAs ask: Do clients expect me to have an MBA as a Fractional CFO? Do I need to get my MBA if I want to grow a firm?

Here are some facts:

1. My firm is almost 9 years old. I have been asked exactly ZERO times about the letters I have after my name.
2. I have worked with successful firm owners who are CPAs, MBAs, EAs, CFAs, and JDs.
3. I have worked with as many successful firm owners with no letters after their names.

Why is that? 

Reality:

Clients don't care about your letters.
Clients care about the outcomes you can help them achieve.

Stop worrying about your letters and instead focus on how you can get better at generating results. 

Myth 5: The Case is Clear for a Fractional CFO

The work we do as Fractional CFOs is important.

Yeah, we usually show our clients how to increase their margins or tidy up their balance sheets.

But Fractional CFOs also quite literally:

• Save jobs
• Create jobs
• Help communities
• Enable owners to offer 401ks
•Unlock healthcare as an option for employers 

And this is far from a complete list of the kinds of things we can help with!

The business case for a Fractional CFO is clear and obvious to ANY business out there.

Wrong.

Reality:
Yeah, that's not how this works. The reality is that most businesses have never even heard of a Fractional CFO. And even fewer know even the first thing about what we can help them accomplish and the impact we can help them achieve!

That means we must educate the market and our potential buyers about what we do and what we can do for them.

Don't just assume that people know about the awesomeness you possess as a Fractional CFO.

The For Real Real

Fractional CFO work is great!

If you're thinking about getting into the industry, I hope you do it. 

Just know that there are a lot of landmines out there disguised as myths and bad assumptions that can slow you down and potentially derail you along the way.

Here's my advice: 
Build a network of other Fractional CFOs and don't be scared to ask them questions! 

I know that asking questions and seeking advice doesn't serve the ego well, but getting derailed by myths and bad assumptions won't serve you well, either.

Remember: The ROI of vulnerability is priceless.