What Does it Mean to be “Finance Ready?”

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In small and emerging mid-market businesses, finance often plays second fiddle to the more immediate and earlier-stage demands of accounting. While invoicing clients, settling bills, and navigating tax compliances sucks resources from day one, the finance side of the house takes a back seat, with minimal to no investments into financial planning and analysis (FP&A) and corporate finance.

This common setup represents a big missed opportunity for how these finance capabilities can benefit the business, its leaders, and owners. As revealed by our First Water Finance Readiness Assessment (FiRe Score), less than 30% of small and emerging companies are considered “finance ready” due to this lack of finance investment, and the corresponding misconception that such capabilities are beyond the reach of smaller businesses.

But what exactly does it mean to be “finance ready?” It’s the ability to leverage finance capabilities and experience to pursue and achieve growth, financing, and transaction opportunities. Being finance ready gets you to where you want to go, providing the ability to plot the course through uncharted waters and the tools to navigate or pivot to keep you off the rocks when the wind changes. Let’s delve deeper into this notion and explore its implications for businesses.

Deep Dive into FP&A and Corporate Finance

At the core of finance readiness are FP&A and Corporate Finance capabilities. FP&A encompasses stakeholder reporting, business intelligence, budgeting, and forecasting, while Corporate Finance involves evaluating, preparing, and executing on financing, acquisitions and divestitures. These skill sets serve as catalysts for informed decision-making, strategic planning, and to optimize the growth, capital, and owner roadmaps.

But what direct, tangible benefits do FP&A and Corporate Finance capabilities offer? They enable better growth and better deals (and better teams as a byproduct)!

  • Better Growth – The Smart, Less Risky Kind: Performance and outlook transparency empowers teams to operate efficiently and hold each other accountable for achievable performance objectives and financial outcomes. Visibility into capacity, working capital and liquidity, and outlook scenarios drive improved planning and decision-making (minimizing fire drills and fostering a focus on growth).
  • Better Deals – The Right Ones Done on the Best Terms: Transparency into growth, capital, and shareholder roadmaps facilitates alignment of financing and transactional objectives with growth goals and risk tolerance thresholds. Clarity regarding available options ensures efficient use of resources (don’t waste time barking up the wrong trees), while skillsets and a proven track record, particularly in FP&A, enhance credibility and negotiation leverage that make the business “transactable” while commanding the best possible deal terms.

The Road Ahead: Ready to Respond, Decide and Transact

The journey towards finance readiness encompasses three pillars: readiness to respond, decide, and transact. By harnessing data-driven insights, forward-looking scenarios and analyses, and scalable processes, businesses and teams position themselves as attractive partners for capital and transaction opportunities, all while maintaining a proactive stance.

Let’s explore these pillars in detail:

  • Ready to Respond: Get the right information into the right hands, faster. Optimized information flow empowers teams with the insights they need for timely pivots or course corrections. Credible planning/budgeting (with stakeholder buy-in), alongside ongoing information flow, establishes the basis for performance dialogue and accountability.
  • Ready to Decide: Build better crystal balls. The ability to look forward and sensitize is the key to making confident decisions; too many businesses miss out on opportunities because they don’t have enough visibility to make the leap. Building up capacity, the operational drivers and unit economics, and the sales opportunities into financial outcomes and upside/downside scenarios is the core of effective planning and aligning the capital and personal roadmaps with the growth roadmap.
  • Ready to Transact: Maximize the four “value pillars” that drive the best possible deal terms: decipherability, credibility, growth story and acceleration.
    • Decipherability: Do I clearly know what I am looking at when it comes to performance?
    • Credibility: Does the team employ the processes that make them scalable in managing a larger team and business?
    • Growth Story: Can the team put forth an attractive growth profile and outlook backed by granular builds and defendable assumptions?
    • Acceleration: Is the team taking action and putting points on the board to accomplish the Growth Story?


To be “finance ready” puts the wind at your back to accomplish growth and stakeholder objectives. FP&A and Corporate Finance play pivotal roles in this journey, paving the way for enhanced growth, advantageous deals, and stronger teams. At First Water, we recognize the critical importance of finance readiness at every stage of business growth. Partnering with us grants you access to the finance capabilities, team expertise, and relationship frameworks that meet you where you are and help you achieve your growth, capital, and transaction objectives. We get the right information into the right hands faster, create better crystal balls for confident decisions, and build stronger bridges to lenders and investors.


First Water Finance (FWF) is a finance solutions platform supporting finance leaders, business owners, and capital partners through FP&A, Corporate Finance, and Community. FWF has supported over 100 management teams and sponsors, concentrated in emerging and mid-market enterprises, professionalizing and accelerating the finance function in pursuit of growth, acquisition, and/or sale objectives.

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