Chapter 3: Using Finance As a Strategic Tool
- Admin
- May 19
- 3 min read
Updated: May 20
Chapter 3 of Operations That Scale
Finance is often treated like a compliance checkbox. In a purpose-driven startup, it should be an engine for clarity, accountability and confident decision-making so you can make smart decisions that will help you scale your impact.
At Compact, we help startups treat finance as a core part of their operational strategy. Below we’ve shared three key steps to build this in practice.
1. Build the Minimum Viable Finance Function, then add complexity
Many businesses swing between extremes: doing everything manually in Google Sheets, or overengineering the setup with expensive tools. Both are risky when you are a small and growing business.
These organisations should focus on building a Minimum Viable Finance Function (MVFF) that is lean, reliable and built to scale.
At a minimum, this should include:
Bookkeeping that reflects your reality (automated where possible)
Cash flow forecasting that you review monthly, not just when you are worried about it
A system for approvals and payments that’s fast and auditable
Reporting that doesn’t take hours (or days) to produce
More than anything, your finance function should help you make faster, smarter decisions. If it doesn’t, consider some of the tips below.
2. Treat every pound like it belongs to the mission
Being a purpose-driven leader means treating money as a resource that doesn’t just extend your runway, but maximises your impact.
That means being intentional with how you make financial decisions. For example:
Can you get the same outcome with a no-code tool instead of custom dev?
Are you spending £2,000/month on tools that no one’s using?
Does your cost base align with your values (e.g. paying people fairly, choosing ethical vendors)?
We’ve seen founders extend their runway by 1–3 months just by cleaning up subscriptions, consolidating tools and implementing light-touch approval processes. That’s tangible cash you can spend elsewhere.
3. Clarity builds trust with investors, funders and teams
A clear finance function doesn’t just help you. It helps:
Investors trust your numbers and fund you with confidence.
Team members understand how their work ladders up to your objectives and KPIs.
You make decisions without guesswork or anxiety.
This clarity becomes a multiplier. It builds credibility, creates alignment and unlocks your ability to think strategically.
Our view: good finance enables impact
We believe the best finance operations are:
Lightweight but rigorous
Built with automation in mind
Tightly aligned with decision-making, not just compliance
Proactive, not reactive
We work with founders to:
Set up Xero, Wise and approval tools like Pleo or Spendesk
Build cash forecasting models that are easy to update and explain
Automate reports so you’re not stuck pulling numbers before every board call
Prepare early for R&D tax credits and financial due diligence
We vary our support depending on your company’s values, pace and ambition so that it can genuinely save you time and money.
Mistakes to avoid
Ignoring finance until your nervous about cash
Using a bookkeeper who doesn’t understand startups
Relying on gut feel instead of forecasts
Making decisions without visibility into runway or burn
Want help to treat finance as a strategic asset?
We help purpose-driven startups get the fundamentals in place. From forecasting and reporting to tax credits and payment systems, we’ll build a finance engine that works behind the scenes while you focus on scaling your mission.
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