If your startup is like any other, then you can’t hire someone to just do one job. It’s all hands on deck, and everyone needs to serve several purposes. Many don’t think of CPAs (Chartered Professional Accountants) as the ‘go-to’ startup hire. This post will challenge – and try to change – that prevailing opinion.
Below are two scenarios exploring the value of CPAs at different startup stages, but as I will discuss, a CPAs skillset is very transferable and adaptable to many scenarios.
1. Early Stage Startup:
You’re probably a handful (or maybe just one or two) people – mostly, or all, developers. You have a great product or tech, and now you need to turn it into a business. A CPA would easily handle the accounting work that you’d otherwise have to pay for, and certainly reduce if not eliminate spending on tax work. But that’s not enough to justify their existence on your tiny team.
So what else can they do? Your #1 priority is creating a growing and eventually profitable business, and CPAs are programmed to think in those terms. They excel at forecasting, budgeting, analyzing revenue streams and understanding the true costs associated with making business decisions. Most importantly, they think about it entirely differently from you, bringing a valuable perspective. Strategy and operational decision making is a huge part the CPA’s skill set. Every CPA went through business school and has spent years working with diverse clients. In many ways, the MBA skill set is wrapped right into the CPA, which is why the few that get MBA’s are predominantly specializing. CPAs can help you apply for grants, do market research, build partnerships and even run marketing and product validation if need be (I did all of this at my first startup).
Lets not forget financing: Yes they need to adapt to a slightly different game, but CPAs understand financing, the terms, their implications, and impacts on your business. Governance is also a key area of CPA learning; everything from organizational structure to tax planning, to board oversight. Finally, they will build and defend your numbers, making CPAs extremely comforting to bring along to those pitches (both to you, and your prospective investors).
2. Scaling Stage
You’ve got some money, a growing team and things are moving fast. All of the skill sets I mentioned above will be just as valuable for you. But your CPA will now be able to bring out their secret weapon: process. Despite its lack of pizzazz, process is what keeps the company’s wheels turning. CPAs have spent years understanding, analyzing, and improving the operations of different businesses. They are great at adapting what works to the peculiarities of your company and turning it into a well-oiled machine. Efficiency means savings, and you don’t have money throw around.
CPAs represent an extremely multi-talented group of professionals who know how to roll up their sleeves and are used to long hours. Not every CPA is right for it (like any group), and you need someone who is quick to adapt and comfortable in chaos. But so far not that many CPAs work at startups, despite 87% of them wanting to (Luminari’s CPA community stats); meaning you still have the pick of the litter.
Everyone thinks to hire CPAs once they’re established, who else will run your finance and accounting department? But its time to start thinking of CPAs as the perfect early hire as well.
And even if your company is more established, don’t forget that CPAs are more than just bean counters. Many work in business development, strategy, HR, and other roles at the most successful companies in the world. Why let those big corporations hog all that talent?