Startup Professionals Musings

SEPTEMBER 14, 2016

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 120

Burn Rate Hockey Stick Startup Salary 120

Both Sides of the Table

DECEMBER 16, 2009

I advocated LOUDLY at the board that we needed to cut our burn rate. We couldn’t cut product development (we had 23 people!) If the tool doesn’t grow his revenue then how is he going to cover the additional costs – especially in this market?&#. We were SMOKING cash.

Entrepreneur 306

Entrepreneur Burn Rate Cofounder Sales 306

Feld Thoughts

SEPTEMBER 16, 2011

Since SayAhh is in the pre-launch development stage, the company doesn’t have any revenue yet. They also haven’t launched a product, so there is no corresponding “cost of goods sold” – the direct cost of delivering their product. The default Quickbooks setup uses “Income” to refer to “Revenue”.

Balance Sheet 126

Balance Sheet Fractional CTO Burn Rate Salary 126

Berkonomics

OCTOBER 5, 2023

Fixed overhead for salaries, rent, equipment leases and more make up the majority of the “burn rate” (monthly expenses) for most companies. Since this number is budgeted and pre-authorized, managers tend to focus upon other things such as sales, marketing and product development issues. The art of good management.

Silicon Valley 118

Silicon Valley Burn Rate Angel Investor Down Round 118

Berkonomics

AUGUST 10, 2017

Fixed overhead for salaries, rent, equipment leases and more make up the majority of the “burn rate” (monthly expenses) for most companies. Since this number is budgeted and pre-authorized, managers tend to focus upon other things such as sales, marketing and product development issues.

Silicon Valley 97

Silicon Valley Burn Rate Angel Investor Down Round 97

Berkonomics

MARCH 30, 2010

Fixed overhead for salaries, rent, equipment leases and more make up the majority of the “burn rate” (monthly expenses) for most companies. What most managers miss is that every month cut from the time it takes to perform such tasks cuts the cost by the value of a month’s worth of fixed overhead or burn.

Silicon Valley 85

Silicon Valley Burn Rate Angel Investor Down Round 85

Up and Running

FEBRUARY 20, 2015

If you’re running a subscription business , you’ll want to track churn rate, monthly recurring revenue, lifetime value, and so on. 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.

Metrics 60

Metrics Burn Rate .Net Churn Rate 60

Startup Professionals Musings

JULY 2, 2022

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. 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

Steve Blank

NOVEMBER 18, 2010

For decades startups were managed by pretending the company would follow a predictable path (revenue plan, scale, etc.) The Revenue Plan – The Third Fatal Assumption. Notice that the traditional product introduction model leads to a product launch and the execution of a revenue plan. Albert Einstein.

Burn Rate 252

Burn Rate Management Business Model Customer Development 252

Startup Professionals Musings

SEPTEMBER 30, 2019

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. 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

Steve Blank

AUGUST 27, 2012

Tossing their agile development process and at times their entire business model in the air, the company would go into fire-drill mode and engineering would start working on whatever his latest insight was. Other weeks Yuri would be buffeted by the realities of his burn rate, declining bank account and depressing comments from customers.

Founder 323

Founder Cofounder Advisory Board Burn Rate 323

View from Seed

OCTOBER 15, 2014

Examples of housekeeping include the following list, though not every item will appear every time: Finance: Cash out date, burn rate, 409A valuation, cap table, common/preferred stock dashboard. Even if there’s some kind of product in the market during the first round of financing, it’s probably to be unproven.

Seed Stage 331

Seed Stage Cap Table Metrics Burn Rate 331

Startup Professionals Musings

JANUARY 17, 2014

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. 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

ReadWriteStart

JANUARY 27, 2011

I have discussed at length why revenue sharing channel deals may serve as perfectly fine alternatives to raising equity (or even complements) because of their non-dilutive nature. Jeff has managed to keep his burn rate very low thus far, and a slow and steady crafting of the business is working nicely. million in revenue.

Dilution 114

Dilution Revenue Finance Entrepreneur 114

Startup Professionals Musings

OCTOBER 22, 2017

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational.

Burn Rate 170

Burn Rate Angel Investor Operations Demand 170

BeyondVC

DECEMBER 10, 2009

So first and foremost, I let him know that while it was nice to have a well thought out spreadsheet, that the most important thing was getting the product developed and the right team in place. The remainder would go into deferred revenue. Another area that is quite important is churn rate.

Churn Rate 112

Churn Rate Burn Rate Startup Metrics 112

Startup Professionals Musings

MARCH 30, 2015

Both risks and opportunities in this area can arise from many aspects of your startup, before and after product development. Then you walk the delicate balance between burn rates, revenue flows versus expenses, investment in marketing, and employees. Operational.

Entrepreneur 120

Entrepreneur Burn Rate Startup Angel Investor 120

BeyondVC

DECEMBER 9, 2009

  So first and foremost, I let him know that while it was nice to have a well thought out spreadsheet, that the most important thing was getting the product developed and the right team in place.    The remainder would go into deferred revenue.    Another area that is quite important is churn rate. 

Churn Rate 78

Churn Rate Burn Rate Startup Metrics 78

The Equity Kicker

JANUARY 10, 2020

They find a niche in the market where they can grow some revenues and then they raise some more money. It’s got a big burn rate, it’s too big to pivot, and it goes bust. We have been crucial in getting the product to market. And everyone’s lost a lot of money. But the two founders were both business-oriented.

Partner 68

Partner Early Stage Portfolio Metrics 68

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). The key is to be able to refute as many major hypotheses as you can.

San Francisco 117

San Francisco Lean Continuous Deployment DC 117