Both Sides of the Table

OCTOBER 12, 2010

If you can’t figure all of this out then adding a non-founder sales person isn’t going to solve your problems – it’s just going to add to your burn rate. As they become more senior they take on management responsibilities such as planning, forecasting, pipeline reviews, coaching staff, etc.

Hiring 346

Hiring Sales Startup Early Stage 346

Both Sides of the Table

JUNE 19, 2017

One of the hardest decisions entrepreneurs make when they start a company and raise outside capital is figuring out what an acceptable “burn rate” is. That is, how much should your company be willing to lose in cash every month as you make investments in staff and equipment that funds technology, sales, marketing and management.

Burn Rate 212

Burn Rate Startup .Net Venture Capital 212

Both Sides of the Table

DECEMBER 16, 2009

I just knew that our sales sucked wind and we were burning through tons of cash. I advocated LOUDLY at the board that we needed to cut our burn rate. I walked through my logic, “well, if a customer installs your tool on his website he’s going to have to hire an entire staff to manage the project.

Entrepreneur 306

Entrepreneur Burn Rate Cofounder Sales 306

Feld Thoughts

NOVEMBER 18, 2013

This second kind of seed financing can be a double-edged sword for the entrepreneur and company if not very carefully managed. A review of the cash position, burn rate, and execution plan would have revealed there was not enough cash on hand to nail the pivot while leaving 3-6 months of time in market before raising again.

Burn Rate 153

Burn Rate Equity Software Review Early Stage 153

The Next Web

DECEMBER 2, 2013

Henrik Werdelin , the Managing Partner of Prehype , a venture development firm based in New York City that has helped build companies like Tradable , Barkbox , FancyHands , Basno and Path , says recreating Twitter isn’t necessarily difficult, but the layered features will take time to get right. 1) Twitter. 4) WhatsApp. 8) Angry Birds.

Cost 168

Cost San Francisco New York City Ruby 168

Startup Professionals Musings

APRIL 10, 2016

From my perspective as an investor, I recommend that every founder needs to know the answers to these questions, be open and honest in answering them thoughtfully, and without making excuses: What is the current runway and burn rate? How complex is the capitalization table? When did this effort really start, including pivots?

Sweat Equity 120

Sweat Equity Burn Rate Technical Review Intellectual Property 120

Startup Professionals Musings

APRIL 8, 2015

From my perspective as an investor, I recommend that every founder needs to know the answers to these questions, be open and honest in answering them thoughtfully, and without making excuses: What is the current runway and burn rate? How complex is the capitalization table? When did this effort really start, including pivots?

Technical Review 120

Technical Review Due Diligence Sweat Equity Burn Rate 120

David Teten

NOVEMBER 26, 2019

Instead of budget approvals, monitor key metrics and give managers more flexibility. How should a growth company manage their budget? So here’s the solution I have recommended to some of my portfolio companies: “ agile budgeting ”, i.e., monitoring a few key variables while giving managers significant flexibility.

Agile 60

Agile Management Forecast Silicon Valley 60

Both Sides of the Table

AUGUST 9, 2011

I need leaders who manage in good times and bad.To build a large company you need to manage through economic cycles. Companies raised too much money in 2005-08 and had high burn rates. My deal got dragged out and eventually never happened. tl;dr summary. VCs were very active in this period. So no new deals got done.

Stock 305

Stock Technical Review Marketing Greece 305

YoungUpstarts

JUNE 20, 2019

Series B: Hiring and Developing Managers. While additional personnel is crucial to scale the product, misaligned hires will increase burn rate without a concurrent jump in productivity and meaningful growth. The psychological shifts required to go from being an individual contributor to a manager shouldn’t be underestimated.

Technical Cofounder 113

Technical Cofounder Burn Rate Seed Stage Cofounder 113

Steve Blank

MARCH 17, 2020

They have fewer cash reserves and less margin of error for managing sudden downturns. The questions every startup or small business CEO needs to ask now are: What’s my Burn Rate and Runway? Burn Rate and Runway. Subtract your monthly gross burn rate from your monthly revenue to get your net burn rate.

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

Up and Running

JULY 27, 2020

In fact, you can use your financial forecast to actively manage your business and improve your chances of success and growth. A key benefit of using your forecast as a management tool is that you’ll be able to significantly improve how you manage your cash and cash flow. Why is cash flow management important?

Forecast 83

Forecast Management Cash Position Software Review 83

Feld Thoughts

OCTOBER 5, 2022

Andy Dunn , who I only know indirectly, wrote an important book titled Burn Rate: Launching a Startup and Losing My Mind. While there might be other entrepreneur autobiographies like Burn Rate , I can’t think of any. It’s entirely manageable.

Burn Rate 153

Burn Rate Startup New York Restful 153

Up and Running

APRIL 22, 2020

If you lack an obvious history of responsible debt management, try to start building that up by applying for smaller lines of credit and assuring that you regularly pay it off. Cash flow management is important at any time, and basically provides a snapshot of the health of your business. Poor cash flow. Risky industry.

SBA 139

SBA Forecast Software Review Business Plan 139

Genuine VC

FEBRUARY 9, 2011

Employee count is the strongest (but not a perfect) proxy for management’s and investors’ outlook on the business. What is the burn rate and how much cash is in the bank now? a founding CEO stepping aside to make room for professional management could be an indicator of successful growth).

Startup 146

Startup Burn Rate Technical Review Down Round 146

Steve Blank

NOVEMBER 18, 2010

For decades startups were managed by pretending the company would follow a predictable path (revenue plan, scale, etc.) As we described in previous posts , startups fail on the day they’re founded if they are organized and managed like they are a small version of a large company. Albert Einstein. That’s the definition of insanity.

Burn Rate 252

Burn Rate Management Business Model Customer Development 252

Hunter Walker

APRIL 17, 2022

Now, my salary doesn’t go to zero overnight because we’re still drawing down historical management fees but it’s all downhill from here as those income streams taper and end. Or at least it was the resulting impact of declining to take additional capital from our investors and commit our own dollars instead. Nice things are nice.

Burn Rate 147

Burn Rate Salary Early Stage .Net 147

techcrunch.com

FEBRUARY 26, 2013

He knows how to advise entrepreneurs on hiring/firing, running teams, managing funding, when/how to control burn rate, and making other tough management decisions in the real environment of startups. Those advisors don’t make decisions for management.

Burn Rate 87

Burn Rate Hiring Engineer Entrepreneur 87

Up and Running

FEBRUARY 20, 2015

However, there are a number of metrics that every business owner should know, including cash flow, accounts payable, accounts receivable, direct costs, operating margin, net profit, and cash burn rate. It’s important to track this metric so that you can manage your cash flow. What Is Cash Burn Rate?

Metrics 60

Metrics Burn Rate .Net Churn Rate 60

crowdSPRING Blog

OCTOBER 10, 2014

Refocusing the Startup Burn Rate Debate | OpenView Blog – crowdspring.co/1n8paLq. 44 engineering management lessons – crowdspring.co/1x7TVkf. Stock option questions startup employees should ask | Business Insider – crowdspring.co/1n8lUje. React – crowdspring.co/1yHa1WB. In-Residence – crowdspring.co/Zmo0kD.

Social Media 97

Social Media Small Business Design Media 97

Up and Running

APRIL 30, 2020

” It’s been a favorite management tool of mine since my time as VP for a market research firm, and it’s a method I used for decades growing a software company from zero to well over $10 million in annual sales. You have to have good numbers to optimize your management. How to conduct a scenario analysis.

Forecast 120

Forecast Balance Sheet Burn Rate Software Review 120

Up and Running

APRIL 6, 2020

This can be a daunting task, but the best place to start is understanding and calculating your cash burn rate and your cash runway. How do you calculate the burn rate? This total number is your Gross Burn Rate. Gross burn rate = (Total variable expenses + Total fixed expenses).

Burn Rate 100

Burn Rate Forecast SBA Cash Position 100

Both Sides of the Table

SEPTEMBER 28, 2014

I was reading Danielle Morrill’s blog post today on whether one’s “ Startup Burn Rate is Normal. Danielle goes through some commentary from Bill Gurley, Fred Wilson and Marc Andreessen about burn rate and then goes on to discuss her own burn rate and others publicly weigh in.

Burn Rate 383

Burn Rate Balance Sheet .Net Valuation 383

Startup Lessons Learned

MARCH 27, 2009

The full formula works like this: runway = cash on hand / burn rate # iterations = runway / speed of each iteration Very few successful companies ended up in the same exact business that the founders thought theyd be in (see Founders at Work for dozens of examples). What counts as an iteration? Were talking PayPal -sized variations.

San Francisco 117

San Francisco Lean Continuous Deployment DC 117

Tim Keane

DECEMBER 14, 2009

  A low burn rate is a pearl of great price.    It provides lots of options that high burn rates take away.    A low burn rate is a pearl of great price.    It provides lots of options that high burn rates take away.  Managing Company Growth.

Burn Rate 60

Burn Rate Angel Groups Seed Stage Startup 60

Transformify

AUGUST 27, 2017

Their investors may push them into that direction too, as the high burn rate is often seen as a prerequisite for high growth. You will have more time to focus on the strategy and sales while looking for the right project/ product manager, etc. The downside? Outsource the development of your MVP.

Hiring 64

Hiring Software Review Burn Rate Startup 64

Startup Professionals Musings

JULY 2, 2022

Great entrepreneurs have learned how to realistically assess and manage both sides of the coin in the following business opportunity and risk categories: Strategic. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational.

Burn Rate 382

Burn Rate Angel Investor Operations Demand 382

YoungUpstarts

SEPTEMBER 30, 2014

Here are five things I learned (and was forced to learn) on how to manage a fast growing company. Watch your burn rate — the amount of capital you use up every month. Daniel Barnett is the founder of WORK[etc] , a cloud-based CRM, Projects, & Billing management tool. Repay that Startup Debt.

Burn Rate 248

Burn Rate Startup Cloud Management 248

Both Sides of the Table

MAY 2, 2015

For a well-funded seed company I have controversially recommended hiring a great office manager that doubles as an administrative assistant. They can show the projections on what this does to burn rate. This is all about “leverage” which is the key to success. They can help you with pricing.

Operations 150

Operations Metrics Early Stage Non-Compete 150

VC Cafe

FEBRUARY 6, 2011

Not literally, but one big surprise to me was that in the 40 odd investor meetings I had, I managed to open the deck probably only 5-10 times. R&D outside SV is normally cheaper, so it helps you keeping your burn rate low. You only have one chance at a first impression. Get your deck to 10 slides and then throw it away.

Silicon Valley 104

Silicon Valley Startup Seed Stage Delaware 104

Up and Running

APRIL 27, 2020

Current businesses are finding ways to pivot their business models, revisiting their budgets, and developing new forecasts to minimize their burn rate and maximize their available cash runway. But it doesn’t have to be all bad. .

Software Review 113

Software Review Lean Forecast Business Plan 113

Startup Professionals Musings

NOVEMBER 2, 2012

My advice to founders out there is to not volunteer too much, but be open and honest in the face of direct questions like the following: What is your burn rate and runway today? But don’t let management divert you with comments on your failure to understand “the vision and the big picture.”

Due Diligence 244

Due Diligence Sweat Equity Burn Rate Intellectual Property 244

Startup Professionals Musings

SEPTEMBER 30, 2019

Great entrepreneurs have learned how to realistically assess and manage both sides of the coin in the following business opportunity and risk categories: Strategic. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational.

Entrepreneur 267

Entrepreneur Burn Rate Angel Investor Operations 267

Both Sides of the Table

MAY 23, 2010

They trust the judgment of the VCs to source, finance, help manage and then create some sort of exit for the investments that they make. You’ve kept a really low burn rate and paid yourself a very small salary. VC’s money comes from mostly institutional investors called LPs (limited partners).

Startup 290

Startup Burn Rate Warrant Bankruptcy 290

Startup Professionals Musings

DECEMBER 15, 2014

Focusing on the burn rate and prioritizing every possible expense will keep overhead down, help you stay lean, and achieve a higher profit earlier. Managing investors is a distraction from your core business. You will squeeze harder on your own dollars than investor dollars. Sometimes survival requires staying under the radar.

Bootstrapping 276

Bootstrapping Entrepreneur Startup Burn Rate 276

Startup Professionals Musings

JUNE 28, 2013

Focusing on the burn rate and prioritizing every possible expense will keep overhead down, help you stay lean, and achieve a higher profit earlier. Managing investors is a distraction from your core business. You will squeeze harder on your own dollars than investor dollars. Sometimes survival requires staying under the radar.

Startup 264

Startup Burn Rate Bootstrapping Valuation 264

Startup Professionals Musings

JANUARY 17, 2014

Great entrepreneurs have learned how to realistically assess and manage both sides of the coin in the following business opportunity and risk categories: Strategic. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational.

Burn Rate 234

Burn Rate Angel Investor Entrepreneur Operations 234