The Finance Hiring Mistake Many Startups Make
Jun 18, 2026
One of the biggest finance mistakes I see in startups isn't around forecasting, reporting, or cash flow.
It's hiring.
More specifically:
Building a finance team for the business you have today instead of the business you're trying to become.
I've seen this mistake from both sides.
I've worked with founders building finance functions for the first time, and I've joined businesses as a CFO and inherited finance teams that were no longer fit for where the business was heading.
The challenge is that startups grow quickly.
The finance team that worked perfectly 12 months ago may already be struggling to support the next stage of growth.
Most Finance Hiring Is Reactive
The problem often starts because hiring decisions are made in response to pain.
Examples include:
- Month-end is taking too long
- Reporting quality is poor
- Cashflow visibility is weak
- The founder doesn't trust the numbers
- The finance team is overwhelmed
So the business hires someone to fix the immediate issue.
The problem is that the hire is often designed to solve today's challenge rather than support tomorrow's growth.
Six months later, the business has doubled in complexity and the finance function is struggling again.
Hiring for Current Volume Instead of Future Complexity
One of the biggest mistakes finance leaders make is assuming growth simply means more transactions.
It doesn't.
Growth creates complexity.
As a business scales, finance often needs:
- stronger controls
- better forecasting
- investor reporting
- cash runway management
- business partnering
- more sophisticated systems
The skills required to manage a £2m revenue business are often very different from the skills required to manage a £10m revenue business.
When building a finance team, it's worth asking:
What will this business look like in 18 months?
Not just:
What problem are we solving today?
Hiring Technical Strength and Ignoring Commercial Skills
This is something I see regularly.
A finance leader is hired because they are technically excellent.
They can:
- produce accounts
- manage audits
- build controls
- ensure compliance
All important skills.
But startups need more than technical competence.
As businesses scale, finance leaders need to:
- influence decisions
- challenge assumptions
- understand commercial drivers
- communicate with non-finance teams
The most successful CFOs are rarely the most technical person in the room.
They're the people who can connect financial information to business decisions.
Keeping the Team Too Junior for Too Long
This is probably more common than hiring too senior too early.
Many startups try to stretch the finance team beyond its natural capability.
Examples include:
- Finance Managers expected to perform CFO responsibilities
- Bookkeepers expected to build forecasts
- Controllers expected to lead strategic planning
The result is usually predictable:
- reporting becomes reactive
- forecasting quality suffers
- finance spends all its time looking backwards
None of this reflects badly on the individual.
They're simply being asked to do a role they haven't had the opportunity to grow into yet.
Thinking About Roles Instead of Functions
One thing I've learned over the years is that great finance teams aren't built around job titles.
They're built around responsibilities.
When I think about a finance function, I think about areas such as:
- transaction processing
- financial control
- reporting
- forecasting and FP&A
- treasury and cash management
- business partnering
The question becomes:
Who owns each of these responsibilities?
Once you understand that, the hiring decisions become much easier.
Building the Future Team Early
One of the first exercises I completed in my current CFO role was mapping:
- the finance team today
- the finance team I think we'll need in three to five years
Not because I plan to hire all of those people tomorrow.
But because it helps identify capability gaps.
It changes the conversation from:
Who should we hire next?
To:
What capabilities will the business need as we grow?
That's a much more strategic way to think about finance hiring.
Not Every Problem Needs a Full-Time Hire
This is another trap finance leaders sometimes fall into.
As complexity increases, the instinct is often to hire.
Sometimes that's the right answer.
Sometimes it isn't.
There may be alternatives such as:
- automation
- outsourced support
- specialist contractors
- fractional expertise
The goal isn't to build the biggest finance team.
The goal is to build the right finance function.
The Question Every Finance Leader Should Ask
Before making a finance hire, ask yourself:
Will this person still be the right hire if the business doubles over the next 18 months?
If the answer is no, it's worth taking a step back and thinking about the longer-term structure before making the decision.
Because hiring is expensive.
Replacing the wrong hire is even more expensive.
The finance hiring mistake many startups make is building a team for today's business rather than tomorrow's.
Strong finance leaders think differently.
They think about:
- future complexity
- future capabilities
- future structure
And they build the finance function accordingly.
The goal isn't simply to solve today's problems.
It's to create a finance team that can support the next stage of growth.
This is part of my Startup Finance Mistakes series. You might also find these useful:
- Why Startups Run Out of Cash
- Why Startup Forecasts Are Usually Wrong
- The KPI Mistake Many Startups Make
- The 5 Skills Every Future CFO Must Learn
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