A Chief Financial Officer (CFO) and a Chief Revenue Officer (CRO) both play important roles in managing a company's financial health, but their primary objectives and the nature of their work differ.
Overview of CFO and CRO roles
A CFO is responsible for overseeing a company’s overall finances, which can include developing strategies for budgeting, accounting, planning, and operations for profitability.
Whereas a CRO is responsible for identifying, assessing, and converting sales into revenue. They oversee sales and marketing teams to maximise revenue and growth opportunities.
Main differences between a CFO and CRO role
The main differences between a CFO and a CRO are in the areas of their focus, responsibility within an organisation, interactions with stakeholders, and expertise.
CFO: They focus on financial management and develop strategies to ensure the company's financial stability, profitability, and compliance with regulations.
CRO: They develop and execute sales and marketing strategies, set revenue targets, and track performance against set targets.
CFO: The key metrics a CFO focuses on include the company’s gross profits and working capital. They also look at metrics driving costs such as expenses or employee count.
CRO: The main metrics a CRO looks at is return on investment of sales and marketing campaigns, annual revenue, and rates of renewals with customers.
CFO: Their responsibilities typically include financial planning, analysis and reporting, overseeing accounting and operations, and ensuring compliance.
CRO: They are responsible for any of the revenue generation activity including sales and marketing, and scaling the business.
They work closely with sales teams to acquire and retain customers, develop sales pipelines, and closing deals. Meanwhile, their collaboration with marketing teams is to generate leads, build brand awareness, and implement effective marketing campaigns.
CFO: They interact with various internal and external stakeholders, including the CEO, investors, and regulatory bodies. They provide financial insights, forecasts, and reports. They play a key role in communicating the financial performance of the company to external parties.
CRO: CROs interact with internal stakeholders including the CEO, Operations, and Sales and Marketing representatives. They provide revenue insights and forecasts, and aim to drive overall business growth.
The specific stakeholders for CROs and CFOs may vary depending on the size and structure of the company and the industry.
CFO: CFOs possess strong financial and accounting expertise. They also need to stay updated on financial regulations and reporting standards.
CRO: Their expertise lies in sales strategy, marketing and branding, pricing and revenue optimisation, business development, and data analysis. They may also have strong business and finance skills.
Do you need a CFO and a CRO?
In early-stage startups, the tasks of a CRO and CFO may fall under a CEO’s obligations. However, as the company evolves, a CRO may join the team to help drive revenue and growth. Startups may also choose to outsource or hire part-time or fractional CROs. Find out more about hiring for a startup.
In the longer term when a company has grown significantly, or if a startup is being acquired by a larger entity, it may be beneficial to hire a CFO. At medium-sized companies and bigger corporations CFO role is generally more established.
Hiring for a startup or company? Legislate can help ensure contracts are in place and tailored to business needs. Employers can create bespoke contracts without the need for expensive legal fees. Additionally, our platform allows employers to extract important data from legal documents, helping make informed decisions faster.
Book a demo or sign up today to put the confidence back into contracting.
The opinions on this page are for general information purposes only and do not constitute legal advice on which you should rely.