Startup Professionals Musings

JULY 15, 2013

Otherwise, sales, marketing, and operational costs will kill you. Next comes sales volume by channel. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. That should be true even if your customer is really a distributor. This forecast is really their commitment.

Forecast 238

Forecast Business Plan Burn Rate .Net 238

Startup Professionals Musings

MARCH 22, 2011

Otherwise, sales, marketing, and operational costs will kill you. Next comes sales volume by channel. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. That should be true even if your customer is really a distributor. This forecast is really their commitment.

Forecast 230

Forecast Burn Rate Startup .Net 230

Both Sides of the Table

DECEMBER 16, 2009

He asked each sales / biz dev person to call customers and tell them they had to change their contracts. 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. A new and experiened CEO was brought in and cleared house.

Entrepreneur 306

Entrepreneur Burn Rate Cofounder Sales 306

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

FEBRUARY 8, 2016

The startup industry may be “resetting,” which doesn’t mean a “crash” but rather just a resetting of valuations, timescales, winners/losers, capital sources and the relative emphasis of growth rates vs. burn rates. Optimize for a W more than % dilution in these circumstances.

Burn Rate 150

Burn Rate Cap Table Startup Dilution 150

Steve Blank

FEBRUARY 26, 2013

90 days later, I found out our games are terrible, no one is buying them, our best engineers started leaving, and with 120 people and a huge burn rate, we’re running out of money and about to crash. This can’t be happening to me. Stage 2: Deny any of it was your fault. Stage 3: Get angry and blame everyone else.

Redemption 225

Redemption Cofounder Silicon Valley Burn Rate 225

YoungUpstarts

MAY 19, 2016

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? To become part of the surviving half, use these methods to ensure your startup’s structure stands strong. Read your books from cover to cover.

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. Next comes sales volume by channel. Your “burn rate” or net cash flow out is usually the single most important survival parameter to a startup. That should be true even if your customer is really a distributor. This forecast is really their commitment.

Forecast 151

Forecast Startup Burn Rate .Net 151

Feld Thoughts

NOVEMBER 18, 2013

The people on the sales side don’t feel they can charge for it yet because who’s going to take out their wallet for something that isn’t perfect. Company Hygiene Matters – One of the responsibility of a Board of Directors is to regularly discuss financials, burn rate, and cash management.

Burn Rate 155

Burn Rate Equity Software Review Early Stage 155

Both Sides of the Table

AUGUST 9, 2011

Companies raised too much money in 2005-08 and had high burn rates. I show charts on housing, structural unemployment, home equity re-financings that we spent meaning less spending power post crash, new housing sales, debt-to-income ratios, public-sector job problems that will cause crises in cities and states across the US.

Stock 305

Stock Technical Review Marketing Greece 305

Steve Blank

MARCH 17, 2020

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. What does your new business model look like? How do you know?

Burn Rate 436

Burn Rate Startup Valuation Sales Cycle 436

VC Cafe

NOVEMBER 2, 2019

In SaaS the main benchmarks being measured are revenue growth, sales efficiency (unit economics), churn and burn rate. Rob Go: How Much Traction Do You Really Need to Raise a Seed or Series A Round? Software as a Service (Saas) benchmarks.

B2C 141

B2C Technical Review Startup Retention 141

Up and Running

APRIL 22, 2020

Maintaining your business through the coronavirus crisis has likely led you to cut costs, revise your sales projections, and potentially seek out a loan to help you stay afloat. Thoroughly explain your situation and provide absolute proof that your business is struggling due to the virus.

SBA 139

SBA Forecast Software Review Business Plan 139

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 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. Impact on sales: If sales go down 30%? What is a scenario analysis? Will businesses open slowly?

Forecast 120

Forecast Balance Sheet Burn Rate Software Review 120

Both Sides of the Table

MAY 2, 2015

It freed up Ophir to grow out our sales organization, to work more closely with agencies, to innovate on product and to raise capital. They can show the projections on what this does to burn rate. At board meetings Ophir could focus on strategic questions because he knew that Phil could answer to every number in our board pack.

Operations 150

Operations Metrics Early Stage Non-Compete 150

crowdSPRING Blog

DECEMBER 12, 2014

Don’t Get Burned by Your Burn Rate – crowdspring.co/159KKrk. Online Sales for Girl Scout Cookies Are Approved – crowdspring.co/1pIc88R. When You Give Your Team a Goal, Make It a Range – crowdspring.co/1yINX9Z. 7 Simple Ways to Appreciate your Team (and Boost Performance) – crowdspring.co/1veUNVr. 1v6Fr0z.

Social Media 100

Social Media Small Business Design Media 100

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

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. What Is Cash Burn Rate? Cash burn rate is the rate at which a company uses up its cash reserves or cash balance.

Metrics 60

Metrics Burn Rate .Net Churn Rate 60

Both Sides of the Table

JULY 16, 2013

The company with no revenue and a $150k burn rate that raised $2.5 And if your ultimate strategy is a small sale of the business that recovers investment and puts some cash in your pocket – having more time to make this work makes a lot of sense. You’re out of money. So you take the offer you get. I see this weekly.

Burn Rate 412

Burn Rate Dilution Revenue Valuation 412

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

FEBRUARY 5, 2021

There is no black magic involved in predicting the future, if you use these four simple steps, with my basic rules of thumb to keep you on the right track: Determine your margin on sales. Forecast sales-volume expectations. Forecast sales-volume expectations. Per-unit cost less cost of goods sold is your gross profit or margin.

Forecast 369

Forecast Burn Rate Startup Widget 369

Startup Professionals Musings

FEBRUARY 17, 2021

These steps alone can reduce your monthly burn rate by at least $10K. Social media facilitates marketing and sales. You can now skip the mandatory office space rental, with secretary and bookkeeping staff, or outsourcing. Use the cloud and subscriptions for computing technology.

Cost 405

Cost Entrepreneur Burn Rate Social Media 405

Startup Professionals Musings

JUNE 27, 2022

You know you should have been tracking the burn rate, or inventory requirements, or late receivables, but have found yourself totally distracted by a flock of emergency daily issues. They let the burn rate go up too fast, and the business burns down before it really starts.

Burn Rate 329

Burn Rate Differentiation Salary Entrepreneur 329

Steve Blank

NOVEMBER 18, 2010

You can almost set your watch to six months or so after first customer ship, when Sales starts missing its “numbers,” the board gets concerned and Marketing tries to “make up a better story.” The web site and/or product presentation slides start changing and Marketing and Sales try different customers, different channels, new pricing, etc.

Burn Rate 252

Burn Rate Management Business Model Customer Development 252

Up and Running

JULY 27, 2020

Cash doesn’t always show up in your bank account the moment you make a sale and, for most businesses, you need to spend money on your product or preparing your services before you actually make that sale. These are the financial facts of your business, based on your actual sales, expenses, loans, purchases, etc.

Forecast 83

Forecast Management Cash Position Software Review 83

Startup Professionals Musings

OCTOBER 16, 2023

There is no black magic involved in predicting the future, if you use these four simple steps, with my basic rules of thumb to keep you on the right track: Determine your margin on sales. Forecast sales-volume expectations. Forecast sales-volume expectations. Per-unit cost less cost of goods sold is your gross profit or margin.

Forecast 290

Forecast Burn Rate Widget Bootstrapping 290

Startup Professionals Musings

DECEMBER 31, 2013

You know you should have been tracking the burn rate, or inventory requirements, or late receivables, but have found yourself totally distracted by a flock of emergency daily issues. They let the burn rate go up too fast, and the business burns down before it really starts.

Burn Rate 275

Burn Rate Entrepreneur Differentiation Salary 275

YoungUpstarts

SEPTEMBER 30, 2014

Watch your burn rate — the amount of capital you use up every month. While this should be something that you do all the time, keeping your burn rate in check is even more important when you’re scaling up as it is inevitably amplified, sometimes exponentially. Cash Flow is Still King.

Burn Rate 248

Burn Rate Startup Cloud Management 248

Steve Blank

FEBRUARY 13, 2024

Marketing and capital expenses (new factory, high R&D expense) were predicated on consumer-scale sales.

Search 302

Search Marketing Forecast Burn Rate 302

Up and Running

OCTOBER 7, 2019

Think of them like this: If you have a critical sales milestone your company needs to meet by the end of the year, KPIs should deliver incremental evidence that you’re either headed in the right direction, or you’re not. . Activation rate: measures how many visitors are engaging with your website or app. Sales KPIs.

Founder 71

Founder Retention Metrics Technical Review 71

Startup Professionals Musings

AUGUST 27, 2012

Marketing, sales, and partners. Describe marketing strategy, sales plan, licensing, and partnership plans. Show breakeven point, burn rate, and growth assumptions. What is the planned exit strategy (IPO, merger, sale, including likely candidates)? What is the rate of return expected for the investor?

Elevator Pitch 247

Elevator Pitch Exit Strategy Burn Rate Merger 247

Startup Professionals Musings

SEPTEMBER 21, 2019

You know you should have been tracking the burn rate, or inventory requirements, or late receivables, but have found yourself totally distracted by a flock of emergency daily issues. They let the burn rate go up too fast, and the business burns down before it really starts.

Burn Rate 249

Burn Rate Entrepreneur Differentiation Salary 249

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. The next most important set of metrics are sales by category; working capital (cash and other current assets, less current liabilities); EBITA; and gross margin.

Agile 60

Agile Management Forecast Silicon Valley 60

Startup Professionals Musings

MAY 19, 2010

Marketing, sales, and partners. Describe marketing strategy, sales plan, licensing, and partnership plans. Show breakeven point, burn rate, and growth assumptions. What is the planned exit strategy (IPO, merger, sale, including likely candidates)? What is the rate of return expected for the investor?

Elevator Pitch 235

Elevator Pitch Exit Strategy Burn Rate Merger 235

Startup Professionals Musings

JUNE 10, 2011

Marketing, sales, and partners. Describe marketing strategy, sales plan, licensing, and partnership plans. Show breakeven point, burn rate, and growth assumptions. What is the planned exit strategy (IPO, merger, sale, including likely candidates)? What is the rate of return expected for the investor?

Elevator Pitch 234

Elevator Pitch Exit Strategy Burn Rate Merger 234

Both Sides of the Table

MAY 23, 2010

If no financing happened then this “note&# may not be converted and thus would be senior to the equity of the company in the case of a bankruptcy or asset sale. You’ve kept a really low burn rate and paid yourself a very small salary. It starts as a debt instrument (e.g.

Startup 290

Startup Burn Rate Warrant Bankruptcy 290