Creating Headroom

Several months after the previous CFO had left, Ilan was parachuted into a mid-sized psychiatry business that had grown dramatically during Covid. His role was to bring the finance department back on par in as quickly as possible. Cash flows were tight.

The CEO was juggling both his own role and that of the CFO, all while pushing to raise growth money from new investors.

Ilan dealt with a series of problems and opportunities in a short time.

In the first instance, his role was to stabilise the finance department, providing leadership to the finance team of five, reviewing the critical finance functions and ensuring adequate controls were in place.

A new CRM and accounting system had been introduced by non-accountants before Ilan arrived. Vital finance functionality was inadequately planned for, with poor information impacting negatively on collections and exacerbating cash flow issues. By resolving duplications and errors, and introducing daily cash flow forecasts and monitoring, Ilan quickly improved the quality of client information. This led to improvements in credit control after only a few weeks.

Ilan also initiated the overhaul of the employee cost base to align it with revenue streams and help resolve a huge fixed cost millstone. The ideal outcome was paying professionals for hours actually worked, rather than a salary regardless of their contribution. This at least created a path to profitability.

Lastly, Ilan stepped in midway through a fundraising process, supporting the VC equity raise from a financial perspective, including projection modelling, presentation deck, and advisor meetings. As often happens, the business raised funds, but not in the manner originally anticipated. Flexibility was critical.