Startup Professionals Musings

JULY 15, 2013

Otherwise, sales, marketing, and operational costs will kill you. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. The holy grail is break-even, when revenues first catch up with the outflow. That should be true even if your customer is really a distributor.

Forecast 238

Forecast Business Plan Burn Rate .Net 238

Startup Professionals Musings

MARCH 22, 2011

Otherwise, sales, marketing, and operational costs will kill you. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. The holy grail is break-even, when revenues first catch up with the outflow. That should be true even if your customer is really a distributor.

Forecast 230

Forecast Burn Rate Startup .Net 230

YoungUpstarts

MAY 19, 2016

by Gadiel Morantes , chief revenue officer at Early Growth Financial Services. Use burn rate as an example. If you don’t understand how much money your company is burning through each month, how can you expect to intelligently talk about your fiscal health? A Jenga tower is a precariously built one.

Technical Review 124

Technical Review Burn Rate IP Intellectual Property 124

Startup Professionals Musings

MARCH 25, 2010

Otherwise, sales, marketing, and operational costs will kill you. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. The holy grail is break-even, when revenues first catch up with the outflow. That should be true even if your customer is really a distributor.

Forecast 151

Forecast Startup Burn Rate .Net 151

Both Sides of the Table

AUGUST 9, 2011

Companies with less than $2 million in revenue were asking for $50-60 million valuations and getting them. Mostly we got to see the team operate in stressful times and that changed my perspective on the deal. Companies raised too much money in 2005-08 and had high burn rates. was still a term being bandied about.

Stock 305

Stock Technical Review Marketing Greece 305

Steve Blank

MARCH 17, 2020

Here are a few thoughts about operating in uncertainty in a pandemic. The questions every startup or small business CEO needs to ask now are: What’s my Burn Rate and Runway? Burn Rate and Runway. To answer the first question, take stock of your current gross burn rate i.e. how much cash are you spending each month.

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

Up and Running

APRIL 22, 2020

This does not mean that you need 2-3 years’ worth of documents showcasing your revenue and cost of goods sold, but you’ll likely need reports that show at least 12-months of financial activity. If your business has only been operational for a few months you do have options. Risky industry.

SBA 139

SBA Forecast Software Review Business Plan 139

View from Seed

OCTOBER 24, 2019

As a first time founder, having a few million dollars in the bank after a successful seed raise may seem like a huge amount of capital, and it’s easy to lose discipline around your burn rate. Experienced founders: B2B.

Dilution 149

Dilution B2B Burn Rate Early Stage 149

Up and Running

FEBRUARY 20, 2015

Depending on the type of business you operate, the metrics you monitor will differ. For example, if you have an eCommerce website , you’ll want to measure unique visitors, referrals, bounce rate, and similar. What Is Operating Margin? Net profit is your operating income minus taxes and interest. What Is Cash Burn Rate?

Metrics 60

Metrics Burn Rate .Net Churn Rate 60

Startup Professionals Musings

FEBRUARY 5, 2021

Yet every business requires revenue and volumes, as certainly as it requires a product to sell. As a rule of thumb, most viable businesses need a gross margin above 50 percent, even on wholesale prices, to cover operational expenses and survive as a business. Doubling revenue each year is a good target. Quantify overhead costs.

Forecast 369

Forecast Burn Rate Startup Widget 369

Startup Professionals Musings

JULY 2, 2022

Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Once a business is operational, the opportunity can be maximized, and risk managed through best-of-breed processes, and a rules-based control model.

Burn Rate 382

Burn Rate Angel Investor Operations Demand 382

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

Up and Running

APRIL 6, 2020

You need cash in the bank to operate, to pay employees, and to keep the doors open. 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.

Burn Rate 100

Burn Rate Forecast SBA Cash Position 100

Up and Running

APRIL 30, 2020

Each scenario combines the key numbers in the hypothetical case and explores the impact on the bottom line, and helps you define your cash burn rate and runway. You can revisit the analysis at any time and make adjustments based on your updated budgets and revenue numbers, as well as the changing economic landscape.

Forecast 120

Forecast Balance Sheet Burn Rate Software Review 120

Startup Professionals Musings

OCTOBER 16, 2023

Yet every business requires revenue and volumes, as certainly as it requires a product to sell. As a rule of thumb, most viable businesses need a gross margin above 50 percent, even on wholesale prices, to cover operational expenses and survive as a business. Doubling revenue each year is a good target. Quantify overhead costs.

Forecast 290

Forecast Burn Rate Widget Bootstrapping 290

Both Sides of the Table

JUNE 17, 2017

70–80% of the costs of most startups are employee costs so what you’re really talking about when a company is unprofitable is that they are growing their staff ahead of their revenue. They don’t want high burn rates but they will never fund slow growth. The Nature of Revenue Matters Of course revenue alone won’t tell you enough.

Stock Options 227

Stock Options Startup Dilution Venture Capital 227

Startup Professionals Musings

SEPTEMBER 30, 2019

Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Once a business is operational, the opportunity can be maximized, and risk managed through best-of-breed processes, and a rules-based control model.

Entrepreneur 267

Entrepreneur Burn Rate Angel Investor Operations 267

David Teten

NOVEMBER 26, 2019

Sean Colrock, Director of Client Partnerships at Wiss & Company , suggests at a minimum you track: cash on hand; fume date; and burn rate. Andreas Rothe, CFO, Fragomen , observed, “One of the reasons for a budget is to align the various resources of the firm to projected revenues from clients and company objectives.

Agile 60

Agile Management Forecast Silicon Valley 60

Up and Running

OCTOBER 7, 2019

Many startups focus on growth (instead of profits) and often need to track KPIs that may be different from those used by established businesses: Burn rate : indicates the company’s negative cash flow or how quickly it’s spending money. This metric helps determine how much cash you need for operation and expansion. Sales KPIs.

Founder 71

Founder Retention Metrics Technical Review 71

Startup Professionals Musings

JUNE 18, 2012

Founders now routinely use their home to operate their startup until they are well into the revenue phase. That’s a burn rate of at least $10K per month that can be eliminated if you are handy with computers and Quickbooks. I now see and believe business plans that budget $1K for all this, versus a previous $20K or more.

Cost 255

Cost SEM Burn Rate Startup 255

Startup Professionals Musings

JANUARY 17, 2014

Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Once a business is operational, the opportunity can be maximized, and risk managed through best-of-breed processes, and a rules-based control model.

Burn Rate 234

Burn Rate Angel Investor Entrepreneur Operations 234

Startup Professionals Musings

FEBRUARY 15, 2011

Founders now routinely use their home to operate their startup until they are well into the revenue phase. That’s a burn rate of at least $10K per month that can be eliminated if you are handy with computers and Quickbooks. I now see and believe business plans that budget $1K for all this, versus a previous $20K or more.

Entrepreneur 235

Entrepreneur SEM Burn Rate Social Network 235

abovethecrowd.com

FEBRUARY 24, 2015

As a result, a “late-stage” financing is no longer reserved for high-revenue, pre-profitability companies getting ready for an IPO; it is simply any large round of financing done at a high price. You must subtract it from your top-line revenue. You should not pay a net revenue multiple for a gross revenue disclosure.

IPO 40

IPO Liquidation Preference Valuation Technical Review 40

Startup Professionals Musings

SEPTEMBER 29, 2018

Investors check your burn rate to assess your efficiency, and project your remaining runway before you run out of money and into a brick wall. It doesn’t take a financial genius to recognize that you need to keep your burn rate low. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 223

Burn Rate Hockey Stick Startup Salary 223

Startup Professionals Musings

DECEMBER 11, 2017

As a rule of thumb, most new businesses need a margin above 50 percent, even on wholesale prices, to cover operational expenses and survive long-term as a business. You need 5 percent or more of revenue for marketing, more for new development, and people costs will double as you add benefits, insurance, training, IT and processes.

Burn Rate 144

Burn Rate Forecast Angel Investor Revenue 144

Startup Professionals Musings

OCTOBER 22, 2017

Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Once a business is operational, the opportunity can be maximized, and risk managed through best-of-breed processes, and a rules-based control model.

Burn Rate 170

Burn Rate Angel Investor Operations Demand 170

VC Cafe

JUNE 6, 2024

Key Metrics for B2B SaaS Startups: Annual Recurring Revenue (ARR) Definition: ARR is the yearly value of a company’s recurring revenue from subscription-based services. Monthly Recurring Revenue (MRR) Definition: MRR is the predictable revenue a company expects to receive monthly from subscription-based services.

B2B 97

B2B Burn Rate Generative AI Retention 97

Gust

JUNE 10, 2012

Founders now routinely use their home to operate their startup until they are well into the revenue phase. That’s a burn rate of at least $10K per month that can be eliminated if you are handy with computers and Quickbooks. I now see and believe business plans that budget $1K for all this, versus a previous $20K or more.

Cost 139

Cost SEM Burn Rate Startup 139

Startup Professionals Musings

AUGUST 19, 2020

Investors check your burn rate to assess your efficiency, and project your remaining runway before you run out of money and into a brick wall. It doesn’t take a financial genius to recognize that you need to keep your burn rate low. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 310

Burn Rate Hockey Stick Salary Angel Investor 310

Startup Professionals Musings

JANUARY 4, 2015

Yet every business requires revenue and volumes, as certainly as it requires a product to sell. As a rule of thumb, most viable businesses need a gross margin above 50 percent, even on wholesale prices, to cover operational expenses and survive as a business. Doubling revenue each year is a good target. Quantify overhead costs.

Forecast 120

Forecast Entrepreneur Burn Rate Widget 120

The Startup Magazine

MAY 9, 2024

Initially buoyed by the allure of rapid expansion, this company boasted year-over-year growth rates between 300% to 500%, primarily fueled by low initial annual contract values (ACV) but with the possibility of expansions within the first 12 months. Notable examples such as WeWork and Uber illustrate the perils and potential of this era.

Burn Rate 88

Burn Rate Startup Bankruptcy Metrics 88

Startup Professionals Musings

FEBRUARY 13, 2010

Founders now routinely use their home to operate their startup until they are well into the revenue phase. That’s a burn rate of at least $10K per month that can be eliminated if you are handy with computers and Quickbooks. I now see and believe business plans that budget $1K for all this, versus a previous $20K or more.

SEM 125

SEM Burn Rate Social Network Angel Investor 125

Startup Professionals Musings

MARCH 30, 2015

Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational. Once a business is operational, the opportunity can be maximized, and risk managed through best-of-breed processes, and a rules-based control model.

Entrepreneur 120

Entrepreneur Burn Rate Startup Angel Investor 120

ReadWriteStart

APRIL 30, 2020

Many fail because they fail to keep their burn rate in check and then run out of investors who are willing to fund their operations. They treat their startup’s burn rate like it’s etched in stone. That money would be better spent on creating products and services that drive revenue, however.

Burn Rate 107

Burn Rate Management Startup Early Stage 107

Startup Professionals Musings

OCTOBER 5, 2014

Investors check your burn rate to assess your efficiency, and project your remaining runway before you run out of money and into a brick wall. It doesn’t take a financial genius to recognize that you need to keep your burn rate low. Cashflow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 262

Burn Rate Hockey Stick Entrepreneur Salary 262

K9 Ventures

MAY 28, 2015

At K9 we invest in companies which have a clear/direct revenue model and typically don’t invest in companies that follow the Ubiquity first Revenue Later (URL) revenue model made famous by Eric Schmidt in 2007. I call this Revenue Development and have written about it before. >$0/month. That’s real money.

Revenue 48

Revenue Startup Burn Rate Cofounder 48

Startup Professionals Musings

MAY 14, 2023

Investors check your burn rate to assess your efficiency, and project your remaining runway before you run out of money and into a brick wall. It doesn’t take a financial genius to recognize that you need to keep your burn rate low. Cash flow out equates to burn rate, and the runway depends on your reserves.

Burn Rate 258

Burn Rate Hockey Stick Management Salary 258