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Wondering whether your startup needs a CFO or an accountant? Learn the key differences, when to hire each in 2025
Imagine a company with 50+ employees and no CFO. It sounds implausible, right? Yet, many fast-growing startups in India find themselves in this very scenario—operating without strategic financial leadership while navigating complex funding rounds, expansion decisions, and investor relations.
In the hustle of scaling operations, acquiring users, and raising capital, startup founders often overlook one critical question: "Do we need a CFO, or is our accountant enough?"
As India's startup ecosystem matures rapidly—with unicorns emerging from Bengaluru to Gurugram—understanding the right financial leadership structure becomes vital. This post is your definitive guide to understanding the difference between a CFO and an accountant, and more importantly, when your startup needs a CFO or an accountant.
Let’s explore what it really means to hire a CFO for your startup in India in 2025.
In the initial stages of a startup—especially during pre-seed and seed rounds—financial tasks revolve around compliance and bookkeeping. This is where accountants shine.
Key Responsibilities of an Accountant:
Core Focus: Accountants deal with the past. Their job is to ensure that every rupee is accounted for, taxes are paid, and books are balanced.
As the saying goes, "An accountant tells you what your business did last quarter."
This function is essential for maintaining a solid foundation. But once the startup begins generating revenue, attracting investors, or planning to scale—simply looking backwards isn’t enough.
Enter the CFO.
Chief Financial Officers bring strategic foresight to the table. They are not just financial managers; they are business partners helping founders make smart, future-orientated decisions.
Key Responsibilities of a CFO:
Unlike accountants, CFOs possess a broader skill set and strategic financial expertise. They ask, "Where is the business headed in the next 12-24 months, and how do we get there financially?"
A CFO is ultimately accountable for explaining financial results every quarter, guiding strategic pivots, and ensuring capital is deployed efficiently.
At this point, your startup is just getting off the ground. There may not be enough financial complexity to justify hiring a full-time CFO.
Best-suited finance support:
Focus areas:
A bootstrapped SaaS startup in Mumbai used Jordensky's accounting service in Mumbai and Zoho Books to manage finances for the first 18 months before raising seed funding.
As you enter Series A/B, the game changes. You need financial clarity to:
This is when your startup needs a CFO.
A Bengaluru-based logistics startup raised a $10M Series A and immediately onboarded a fractional CFO from Jordensky to structure their financial plan, who helped them secure an additional $5M bridge round six months later.
A CFO at this stage handles:
At late growth stages, financial operations become highly complex.
Think:
Your CFO is now your key lieutenant in steering the company towards profitability and IPO-readiness.
Case study:
An ed-tech unicorn from Gurugram hired a seasoned CFO from a listed firm ahead of their Series D. The CFO led international tax structuring, ESOP planning, and strategic planning for a potential IPO.
It’s not a question of either/or. Growing startups need both a strong accountant and a strategic CFO.
Accountants:
CFOs:
"Accounting is mostly a scorekeeping function. They need a true CFO."
Together, they form the bedrock and the brain of your startup’s financial ecosystem.
Many founders hesitate to invest in a CFO, viewing it as a luxury. But delaying this decision can cost much more in the long run.
Risks of delaying CFO hiring:
Real scenario:
An e-commerce brand in Mumbai with 100+ employees operated without a CFO. Inconsistent financial reports led to valuation disputes during a Series C fundraise. They eventually started to work with our virtual CFO expert in Mumbai to streamline the communication with the investor and building trust of the lead investor for their fundraise.
Hiring a CFO for your startup is a significant investment but one that protects and accelerates growth.
Here’s a simple checklist:
"Startups need a CFO" isn’t just a trend—it’s a growth mandate in 2025.
Q: What’s the difference between a CFO and an accountant in a startup?
A: An accountant handles past financial records and compliance. A CFO focuses on future planning, fundraising, and strategy.
Q: Does my startup really need a CFO?
A: If you're scaling, raising funds, or expanding, yes. A CFO provides strategic financial guidance.
Q: Can a startup have both an accountant and a CFO?
A: Absolutely. Accountants manage day-to-day finances, while CFOs guide strategic decisions.
Q: When should an Indian startup hire a CFO?
A: A CFO is ideally needed by the time your startup raises seed/Series A funding or when its revenue exceeds INR 5 crore.
In the early days, an accountant is enough. But if you're planning to scale, secure funding, or expand—you need a CFO for your startup.
A CFO isn't just a finance hire. They're a growth partner, a strategist, and your financial compass.
Key Takeaways:
Are you preparing for your next funding round or facing growing financial complexity? It might be time to bring in the right virtual CFO for your startup with our Virtual CFO services in Mumbai and VCFO partners in Bangalore. Reach out to a Jordensky startup financial advisor or fractional CFO to evaluate your readiness today.
Bonus Content: We have prepared a Due Diligence Checklist to understand your readiness for fundraising; you can check the same out here – DD Assessment Tool
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