Accounting & Finance

Why every early-stage startup should outsource its finance team

  • 3 min Read
  • August 31, 2021

Author

Escalon

Table of Contents

Early-stage startup owners often wear multiple hats, from developing new products and making sales to hiring staff members; they barely have time to manage the ledgers. However, handling the books is an essential responsibility in order to keep a company afloat. 

The finance function of any company is complicated yet critical. While one can always hire an in-house accountant or CFO, outsourcing all finance-related responsibilities to an organization that specializes in accounting, bookkeeping, financial benchmarking and reporting can offer several benefits.

Here are 10 key benefits an organization will enjoy by shifting to outsourcing. 

  1. Significant cost savings

    : Outsourcing the finance team comes with benefits such as access to expert CPAs, accountants and chartered accountants at a much lower cost, without compromising on quality. It also helps companies save money on employment taxes, infrastructure fees and other overhead costs. 

  2. Enhanced data security

    : An established outsourcing finance and accounting services firm can put measures in place to handle the serious data security threats that exist because they invest in expensive and impenetrable security systems. This can help mitigate the odds of compromised security programs as well as data breaches. 

  3. Flexibility and scalability

    : An outsourcing organization that specializes in finance services can offer solutions that are customized based on specific requirements. Entrepreneurs can also scale up or down the financial processes as per their needs. 

  4. Stay abreast of the latest policies

    : A specialized outsourcing company will always stay updated with the latest financial and compliance policies and other accounting rules. 

  5. Access to state of the art tech

    : A financial outsourcing company invests in cutting-edge software and technology in order to be competitive; and if finance is not a business’ core function, this type of investment does not make sense for them to take on by themselves. With an outsourcing partner, startup owners can benefit from having access to the latest technology at no additional cost. 

  6. Reduced fraud

    : While deception can never be ruled out completely, a committed outsourced team with expertise in finance best practices keeping an eye on every transaction is far more likely to spot an anomaly than someone whose focus is on building sales and growing a company. 

  7. Round-the-clock service

    : When a company outsources its financial services to a third party, they can keep their operations running 24/7 with a time-zone advantage. They can be assured that all important tasks will be done on time and in a scheduled manner. 

  8. Protection in down economic times

    : As situations change economically, firms tend to change their workforce, which can be a challenging and resource-intensive undertaking. However, since the responsibility of managing the talent assigned to a project lies with the outsourcing company, they do not have to make any decisions regarding its internal workforce or pay to retain staff members. 

  9. Security and confidentiality

    : Because finance is their core offering, a finance outsourcing services partner ensures that all information remains confidential and secure. Entrepreneurs can ask the outsourcing firm to sign a nondisclosure agreement for their peace of mind.  

  10. Focus on core activities

    : Last but not the least, with genuine back-office support, startup owners can stay focused on value-added, revenue-generating tasks such as making strategic business decisions and business development. 

Talk to our team today to learn how Escalon can help take your company to the next level.

  • Expertise you can trust

    Our team is made up of seasoned professionals who bring years of industry experience to the table. You gain a trusted advisor who understands your business inside out.

  • Quality and consistency

    Say goodbye to the hassles of hiring, training and managing in-house finance teams. You will never have to worry about unexpected leave of absence or retraining new employees.

  • Scalability and Flexibility

    Whether you’re a small business or a global powerhouse, our solutions scale with your needs. We eliminate inefficiencies, reduce costs and help you focus on growing your business.

Contact Us Today!

Tap into the latest insights from experts in your industry

Accounting & Finance

AAP vs. Cash Accounting: Which Method Is Best for Your Growing Business? 

Choosing the right accounting method can significantly impact how you track financial performance, manage taxes, and plan growth. Two common...

Read More
Accounting & Finance

Beyond Bootstrapping: Advanced Cash Flow Management for Scaling Companies 

Bootstrapping—financing growth through internal cash flow—is a hallmark of many successful startups. But as businesses mature past their initial stage,...

Read More
Technology & Security

Building a Scalable Tech Stack: How to Choose the Right Tools for Growth 

In today’s business landscape, technology is more than a convenience—it’s a strategic asset that can supercharge growth. But as you...

Read More
Accounting & Finance

How to Reduce Month-End Close Time Without Sacrificing Accuracy 

The month-end close can feel like a perpetual scramble—collecting invoices, reconciling accounts, fixing last-minute errors. A drawn-out close not only...

Read More
uncategorized

How to Reduce Overhead Costs Without Impacting Productivity 

Overhead costs—from utilities and rent to administrative staffing—can quietly swell until they erode profit margins and slow your ability to...

Read More
Accounting & Finance

How to Structure Your Finance Team as Your Business Scales

Growth triggers a tidal wave of financial complexity, multi-entity operations, new product lines, overseas expansion, or investor relations. If your...

Read More
Accounting & Finance

M&A Readiness: How to Prepare Your Financials for a Successful Acquisition or Sale 

Mergers and acquisitions (M&A) can dramatically alter a company’s trajectory—unlocking new markets, technologies, or customer bases. Yet, many deals stumble...

Read More
Accounting & Finance

Optimizing Working Capital: Strategies to Maximize Liquidity Without Raising Funds 

Working capital: The difference between your current assets and your current liabilities. It’s a key barometer of financial health.  While...

Read More
Accounting & Finance

Outsourcing vs. In-House: A Strategic Guide for Growing Companies

Expanding your team and capabilities is critical to sustaining growth—but the question often arises: Should you build an in-house department...

Read More