As venture capital fund managers navigate the complex world of fund structuring, compliance, and investor relations, the importance of a well-designed finance function cannot be overstated.

At Johnston Carmichael, with our network stretching across Scotland to London and beyond, we can support fund managers in setting up and scaling finance operations that meet both immediate and long-term goals. Once the fund structure is in place, designed for tax efficiency and regulatory compliance, it’s essential to turn your focus to the processes, systems, and people that will underpin ongoing financial operations. 

Processes: Laying the foundation for governance and control

From day one, getting your processes right is critical. Being audit ready and investor ready at any moment is no longer a nice-to-have, it is an expectation. Cornerstone investors will scrutinise your controls, looking for evidence that good governance is embedded from the outset. 

By mapping out your processes early, you gain a clear view of: 

• Where controls are needed 
• How responsibilities are segregated 
• Whether compliance tasks are tracked and met in a timely fashion 

An efficiently set-up finance function ensures you're not scrambling to meet deadlines or reactively fixing issues. Instead, you can confidently demonstrate to investors that reporting is timely, controls are robust, and governance is sound. The quality of data input directly impacts the flexibility and clarity of your outputs, another reason why foundational processes matter. 

Our team at Johnston Carmichael can carry out an assessment of your processes and procedures, providing recommendations on best practice from our hands on experience with clients in the financial services sector. 

2. Systems: Scaling with purpose 

Choosing the right systems is not about buying the most expensive software, it is about aligning technology with your growth strategy. Many of our clients begin with tools like Xero, Excel, and specialist apps, which can work well in the early stages. However, as operational complexity increases, so does the need for a more robust solution. Mid-tier financial management platforms, such as Sage Intacct or iplicit, strike the right balance of functionality, scalability, and integration, making them well-suited for growing firms. 

This is where partnering with experienced advisors adds real value. We provide ongoing insights into system capabilities, including data capture, workflow automation, and dashboard reporting. These tools not only enhance internal efficiency but also build investor confidence by demonstrating that the fund is professionally managed and ready for future growth. 

A well-implemented system enables faster month-end closes, a target achievable only through streamlined processes and technology-enabled workflows. 

3. People: Building the right team at the right time 

At the outset of launching a fund, it can feel like hiring a full-time senior finance professional, like a CFO, is essential. But is that truly what is needed in the early stages?  

Before making hiring decisions, take a step back: 

• Are your processes clearly defined? 
• Are your systems doing the heavy lifting? 
• Do you have reliable support to keep the engine running? 

Often, a mix of outsourced and part-time support can deliver what you need, ensuring suppliers are paid, investor reports are timely and insightful, and compliance filings are met without the overhead of a large in-house team. 

Hiring one or two in-house staff can introduce risk. What happens if someone leaves? Will they have the sector-specific and systems knowledge required? Outsourcing all or parts of your finance function can reduce risk, improve agility, and ensure continuity. 

Next steps

Establishing a venture capital fund is only the beginning. Building a finance function that supports scalability, governance, and investor trust requires intentional design. At Johnston Carmichael, we help fund managers implement best practices in process, technology, and people - so you can focus on value creation, not firefighting. Find out more about our Outsourced Finance offering and get in touch here.