As we gear towards 2022, finance leaders are still faced with the business challenges of the pandemic while also remaining firmly fixed on growth.
For the startup CFO 2022 is set to make an already complex job more challenging than ever.
Let’s take a look at some predictions for 2022:
1. Salaries Rising at Faster Rates
In the US a typical employee at a tech start-up is earning 15% more in 2021 in cities such as Boston, Los Angeles or Seattle.
The UK has also followed suit, with starting salaries growing at the fastest rate in 24 years, while in mainland Europe startup salaries for junior employees have grown by 50% in tech-facing roles and 57% for non-tech since 2018.
With inflation set to continue, finance leaders will need to determine how to balance financial management with the need to invest in and incentivize their people.
2. CFOs Will Be More Product-Focused
The CFO’s role in delivering growth has always been fundamental, but now it’s changing.
For tech companies,: product-led growth is serving to maximize velocity. While traditional sales and marketing are still imperatives, supporting users and potential customers to discover, explore, and experience the product for themselves is increasingly becoming core to sustained growth.
For startup finance leaders, this means that they can not afford to be one step removed from the product. They must be willing to get hands-on with how their service is delivered to and consumed by their customers : They need to be more aware of and able to influence the operational levers that determine growth rates and loyalty.
3. Cloud Spend Will Be a Priority
As startups pursue new avenues for growth, they must also manage costs and avoid the existential threat of cash burn. Cloud continues to be a larger share of costs, but a surprising number of these expenses are actually avoidable.
A recent survey of IT decision-makers suggested that as many as 82% of organizations incur unnecessary costs when it comes to the cloud and that 86% cannot instantly generate a simple summary of what they are spending on cloud services. Similar research indicates 30-35% of what companies spend in the cloud is wasted.
With all this in mind, we can expect cloud cost management to continue to be a core concern for startups in 2022, especially as cloud software becomes the norm.
2022 Predictions for Finance Leaders: Maximizing Growth, Minimizing Risk {Free eBook}**
Download our new eBook to check out our complete predictions for 2022. Learn more in-depth how financial leaders must confront:
- A tough and highly competitive hiring market
- A concerning economic backdrop
- Risks posed by breaches of compliance
