The First CFO Usually Isn’t the First Finance Hire

Two questions come up regularly in my conversations with founders and finance leaders. When does a startup need a CFO and what happens to the person who takes that seat first?

My typical answer used to be “Well, it depends”, so we built the dataset we wished had existed earlier: the Story Recruitment First Finance Hire Study 2026.

We studied 191 venture funded Australian startups across tech, fintech and deep tech, each with a funding round confirmed by two independent searches of public announcements. We then dated 966 finance hires from public professional profiles, 907 of them to the month and followed what happened to every first CFO.

This is what we found.

When does a startup hire its first CFO?

How soon a startup’s first CFO arrives is linked to who came before them. If the first finance hire is a Financial Controller (FC), a CFO followed a median 18 months later. After a Head of Finance (HoF) it was 32 months. An FC owns controls and reporting, so the forward-looking view is often a gap. A Head of Finance already owns the model, budgets and forecasting, which will carry the company further before the discussion around a CFO comes up.

However, the sector changes things too. In deep tech, 41 of 52 companies hired a CFO, and 66% (21 of 32) of those that started below CFO added one after a median 18 months, more often and sooner than any other sector. Tech is the opposite, with only 39% (24 of 62) of those that started below CFO added a CFO during the track period. Because a single product SaaS business can run a long way with a capable FC/HoF and an external fractional CFO for any project-based strategic work.

What happens to the first finance hire when a CFO arrives?

Of the 65 companies that added a CFO above a first hire, at least 54% still had that first hire in the seat when the CFO started. Where the second finance hire was itself the CFO, 80% of first hires (24 of 30) were still there when the CFO arrived and 63% (19 of 30) were still there a year later.

This indicates that the first CFO more often arrives as a layer above than as a replacement. If you’re the first finance hire, it’s worth asking during the recruitment process where the CFO seat will sit eventually, when the founder expects to fill it and whether it’s open to you. If you’re the incoming CFO, how you manage that nuanced relationship, including how you’ll split the work, is critical.

Should a startup’s first finance hire be a CFO?

56 of the 191 startups made a CFO their first finance hire, 70% of them before any announced round. Half have since hired another CFO, a median 36 months after the first.

Fintech is the hardest hit. Of the 10 fintechs that hired a CFO first, 9 have lost that CFO after a median 15 months. Deep tech sits at the other end, where first CFOs who left stayed a median 29 months.

The data can’t say why, but my view is that a CFO hired before the first round is often hired for that raise. Two to three years later, the company has grown in complexity and what it needs from its CFO has changed with it.

The mistake I see most often at Series A is a founder who closes the round and goes straight for a CFO. Six months in, the person isn’t being used to their full capacity because the CFO work isn’t there yet. If you’re weighing a startup’s first CFO role, ask whether the capital raising and strategic work is continuous or a single project. Continuous strategic work is a CFO’s job, but single or fragmented strategic work might be best handled by a Head of Finance and an external fractional CFO.

Founders often hire the first CFO on potential

Of those 56 CFO first hires, 37 (66%) came from a previous role that didn’t carry the CFO title. In deep tech it was 16 of 20, with people stepping up from Finance Director, FC, Investment Director and strategy roles. Founders are frequently backing someone into the title, which is fine, as long as everyone is aligned on what gaps they may have. That’s usually a raise or working with the board.

Startup experience is not the entry ticket

Of all 191 first finance hires, only 19% came straight from another startup. 20% came from private businesses outside tech, 16% from large corporates outside tech, 13% from accounting, advisory or CFO services firms and 6% from banks. Only 4% came from the Big 4. In deep tech, only 6% came from another startup, while 44% came from a private business or a large corporate outside tech.

Founders often insist on startup experience, which cuts out 81% of the people who have done this job. The strongest deep tech candidates often come from heavy industry or food manufacturing, defence or mining, where capital intensive work and long commercialisation times are normal.

So if you’re considering a startup’s first CFO role, there are three very clear points from the data. The CFO typically arrives above an FC/Head of Finance who stays on, a CFO hired as the first hire is replaced half the time and startup background is far from essential.

Before you take the role, make sure you know what you’re stepping into and what it will need from you in three years time.

Good luck!

About the author

Tom Hunter is the founder of Story Recruitment, a specialist CFO recruitment business for Australian tech, fintech and deep tech startups.

Tom is also host of The CFO Track podcast and can be found at https://storyrecruitment.com.au and https://www.linkedin.com/in/tom-hunter-story

The CFO Track podcast: https://podcasts.apple.com/au/podcast/the-cfo-track/id1850636057
It can also be found on YouTube and Spotify

The research

• Finance hiring benchmarks (hub): https://www.storyrecruitment.com.au/insights/finance-hiring-benchmarks
• When Australian startups hire finance: https://www.storyrecruitment.com.au/insights/when-australian-startups-hire-finance
• Your first finance hire: https://www.storyrecruitment.com.au/insights/first-finance-hire
• What to hire first: all · tech · fintech · deep tech
• How long after a raise: all · tech · fintech · deep tech
• The second finance hire: all · tech · fintech · deep tech
• When startups hire finance: tech · fintech · deep tech