Empowering Healthy Business Podcast Episode 46 : Scaling from Small Business to Mid-Market

If you run a growing B2B company, there comes a point when “small business” systems stop keeping up. In this episode of the Empowering Healthy Business podcast, Calvin talks with Priya Chanduraj of FIN Team about what it really takes to start scaling to mid-market—and how your finance function becomes a driver of growth, not just a record-keeper. This post distills that conversation into a simple playbook you can use to professionalize finance, avoid common pitfalls, and prepare for bigger opportunities

Why scaling to mid-market demands a new finance approach

Early on, you can get away with scrappy processes and “good enough” books. As you grow, that changes. Revenue rises, risk rises, and outside parties—banks, boards, investors—expect cleaner reporting, stronger controls, and forward-looking plans.

Priya’s core message is straightforward: stop thinking of “accounting” as an after-the-fact task. Treat finance as an operating partner. That shift unlocks better pricing, healthier margins, stronger cash flow, and faster decisions. It also sets you up for audits, lender reviews, and due diligence when the time comes.

Three mindset upgrades make the difference:

• Partner with the business. Finance should help set pricing, monitor gross margin, and flag margin drain—not only close the books.
• Look forward, not just backward. Add forecasting and FP&A so the company can predict, not just report.

Tighten controls as you grow. Clean books, clear ownership of tasks, basic IT and data controls, and audit readiness protect value.

Build the right team at the right time

Most owners ask, “Should I hire a controller or a CFO?” Priya’s answer: start with the role you need, then decide on the title and whether it’s fractional or full-time.

• Controller: Owns day-to-day accounting, closes the books, enforces controls, and ensures accuracy. This is usually the first full-time senior finance hire as complexity rises.
• CFO: Leads strategy, budgeting and forecasting, banking and investor relations, risk, and M&A readiness. Many companies get far with a fractional CFO paired with a strong controller before a full-time CFO makes sense.

A practical guideline: plan to invest 3–5% of revenue in finance and accounting (people and systems). As processes mature and automation improves, that percentage should trend down while insights and reliability trend up.

Get systems and controls ready to scale

Do our tools still fit our size?” is a question to ask every year while scaling to mid-market.

• Core system fit. If you’ve outgrown an entry-level platform, evaluate mid-market options (e.g., NetSuite, Sage Intacct) before pain turns into risk. Stay tech-agnostic, but choose tools that integrate cleanly.
• Process clarity. Document who does what, when, and how—especially at month-end. Most reporting issues start with loose upstream processes.
• Data and IT hygiene. Protect financial data, set access rules, and align with IT on security and privacy. Cross-functional gaps (Finance ↔ IT ↔ HR ↔ Sales Ops) are where errors and risks hide.
• Audit readiness. Even if you don’t need an audit today, prepare as if you will. Clean reconciliations, evidence of review, and simple controls reduce future friction and increase credibility.

The goal is visibility and control at any point in time—so leaders can make confident decisions without waiting weeks for answers.

Link strategy, budget, and forecasting

Mid-market buyers, banks, and boards expect you to predict the future, not just explain the past. Start by building an annual plan that reflects your real strategy and capacity, then keep a rolling 12–18 month forecast that you update monthly or quarterly. Tie the numbers to the drivers that actually move results—sales productivity, unit economics, gross margin, cash conversion, and churn—and make sure Sales Ops, Finance, and FP&A work from the same assumptions. When strategy, budget, and forecast move together, you can invest confidently, spot issues early, and adjust before small problems become expensive. This is a core habit for companies scaling to the mid-market.

Prepare early for M&A and outside capital

As you grow, M&A and fundraising become real options, but readiness takes time. Give yourself 24–36 months to build a clean track record: consistent revenue and margins, a fast and reliable close, audit-ready statements, and clear working-capital mechanics. Develop leadership depth so the business runs without the founder in every decision, and tighten risk and compliance across contracts, insurance, data controls, and any industry regulations. Strategic buyers pay for fit and speed to market; financial buyers pay for reliable growth and scalable systems. In both cases, disciplined finance increases trust, shortens diligence, and improves valuation.

Common pitfalls to avoid

Many teams stall because they treat bookkeeping as back-room work, wait too long to upgrade systems, or underinvest in forecasting. Each of those choices slows decisions and increases risk. Another frequent mistake is hiring a full-time CFO either too early—when the workload doesn’t justify it—or too late, when the organization is already struggling to keep up. Match roles to needs, use fractional support to bridge gaps, and treat accurate, timely data as a non-negotiable input to growth.

Conclusion

Growing companies that jump from small business to mid-market do one thing consistently: elevate finance from a cost center to an operating engine. Build the right team, modernize systems, tighten controls, and connect strategy to a live forecast. Start now—before growth forces the issue—and you’ll scale with fewer surprises, stronger margins, and more options when opportunity knocks.

Want to go deeper? Listen to the full conversation with Tom Freedman on the Empowering Healthy Business Podcast