Does Your Startup Need a Bookkeeper, CPA, or CFO?

Does your startup need a bookkeeper, CPA, or CFO?

Startups face unique accounting and financial challenges at every stage of their growth.

To manage these challenges, many founders choose to bring financial professionals onto their team. These experts can help you create accurate financial statements for your lenders, optimize your tax strategies and manage your cash flows.

But they’re also expensive and every startup’s needs are different. Paying for a CFO when a bookkeeper would suffice can be a pretty costly mistake, one that might be fatal to a business whose margins aren’t yet where they need to be.

So which kind of professional is right for your business? And when is the best time to hire them?

This article will help you figure that out.

Let’s dive in.

4 Basic Types of Financial Professionals

Startups can easily divide their business development into stages based on rounds of funding. We’ll use the following segments to break down a startup’s growth:

  • Early (bootstrapping, pre-seed)
  • Seed-funded
  • Round A
  • Subsequent rounds

While you would probably benefit from having all of the following professionals on your team in each of these stages, it would be difficult to justify the cost in your company’s earliest days.

Instead, you should scale your financial services over time alongside your business’ growth.

Let’s review the benefits of each type of financial professional, how much you can expect to pay them and when they would be most useful for your startup.


  • Description: Record basic business transactions and produce financial reports
  • Cost: $22,000 – $44,000 annually
  • For Startup Stages: Early, seed-funded and Round A

Bookkeepers maintain the records of your daily financial transactions and provide the reports that allow you to track the status and growth of your company.

They’re the most basic and affordable type of financial professional, and you should probably bring them onto your team early on in your startup’s development.

After your startup’s bootstrapping stages, you’ll most likely be looking for additional funding and will need to have accurate financial records for future investors. Your revenue streams shouldn’t be too complicated yet, so a good bookkeeper should be perfectly capable of meeting your needs without the higher price tag of an accountant or CPA.

It can be tempting for a frugal founder to handle the books personally, but bookkeeping can quickly become your full-time job. As the CEO, spend your attention on more productive areas.

Though they’re relatively cheap, make sure to take the time to hire a quality bookkeeper. Sorting through messy financial statements after the fact is a tremendous headache, and it’s always easier to do things right the first time.


  • Description: Assist with financial reporting and provide limited insight from company data
  • Cost: $37,000 – $77,000 annually
  • For Startup Stages: Seed-funded, Round A and subsequent rounds

Accountants are one step up from bookkeepers. They’ll cost you more but also provide vastly better value to a more developed business.

Bookkeeping is almost an administrative task that primarily involves data input, and the role usually requires little in the way of specialized education.

While an accountant’s duties might include some bookkeeping, it’s usually only a small part of their responsibilities. They’re often more highly educated and can assist you with the complicated financial functions of your startup.

For example, you might task an in-house accountant with managing an entire section of your financial operation, such as accounts payable or payroll. A more experienced senior accountant can even help you avoid tax pitfalls or forecast business trends. 

Because of their higher skill-set and price tag, you should wait to hire a full-time accountant until your startup has grown past it’s bootstrapping, pre-seed stages. It might make sense to consult with one briefly as you set up your business entity, but it’s not worth paying an accountant salary when you can get away with a bookkeeper.

Certified Public Accountants (CPAs)

  • Description: More knowledgeable than unlicensed accountants; rigorously tested, with a fiduciary duty to their clients
  • Cost: $51,000 – $131,000 annually
  • For Startup Stages: Seed-funded, Round A and subsequent rounds

CPAs are accountants that have undergone strict licensing tests and must stay up to date with continual educational requirements. They’ll usually cost about 15% to 20% more than their unlicensed counterparts.

CPAs perform many of the same functions as regular accountants but with a superior level of expertise and experience. They often lead a team of less experienced accountants that are in the process of pursuing their certification.

Because they function so similarly, it makes sense to hire a CPA around the same time as you would a regular accountant: not so early that they sit idle, but not so late that your startup makes costly financial mistakes.

Additionally, only CPAs have the authority to give an official opinion on an audit. And to receive funding from anyone other than your friends and family, you’ll probably need to have audited financial statements.

These provide a level of assurance to potential investors that your employees aren’t committing fraud and that the financials are a reasonably accurate representation of your business.

Chief Financial Officers (CFOs)

  • Description: High-level business strategy and management of the entire company’s financial direction
  • Cost: $260,000 – $450,000 annually
  • For Startup Stages: Round A and subsequent rounds

Hiring a CFO for your startup is a significant investment that you should only make when your startup is both highly profitable and well established. They come with much higher salaries and often complicated equity compensation.

CFOs perform a very different function from lower-level financial professionals. While an accountant reports on financial performance and provides insight into the meaning of trends, a CFO takes responsibility for the company’s entire fiscal well-being.

Their role is to synthesize a startup’s entire business strategy and take the company to the next level. They should be highly familiar with financial reporting and the specific nature of your industry. CFOs can help your startup navigate funding Rounds A, B and C.

When you find that the management of your business’ financial concerns have you stretched thin, you should consider hiring a CFO to help.   

Bookkeeper, CPA or CFO? The Benefits of a Scalable Service 

Whether it’s a bookkeeper or a Chief Financial Officer, hiring a full-time staff member is a delicate balance and a big commitment. There are hidden costs to consider, such as recruiting costs, training costs and employee benefits.

And if the relationship isn’t working out after a few months, turnover costs can discourage repeated searches for a more appropriate fit.

Instead of onboarding multiple team members over time, many startups benefit from outsourcing their financial needs.

Working with a company like Founders CPA allows you to easily scale up your services over time and avoid the challenges of hiring a cumbersome full-time staff.

If you’re a young startup in its early stages, you can start with bookkeeping services only. As your business grows over time, you can upgrade to more involved accounting services (even CFO services) with a business that you already trust.

Bookkeeper, CPA, or CFO: Find a Partner to Grow with Your Needs

Working with a single company streamlines the entire financial process and lets you save your time, effort and money for the rest of your business.

Whatever stage of growth your startup is in, Founders CPA can help make your financial functions more efficient. Feel free to take advantage of our free consultation to find out more.

Need Help?  Schedule a FREE consultation with a CPA!