Startup Financial Plan

Managing your cashflow is going to be one of the hardest things you will have to do at a startup. It’s usually not a big concern for startups that raise money fast, but as you slowly burn through this cash in the bank; it will slowly become a full-time job to prioritize and plan ahead. If you’re not planning ahead, things will crumble very fast when you start running low in cash. You MUST know exactly when you will run out of cash if you are asked at anytime.

You can use an excel sheet or online tool to carefully plan your cashflow, but you SHOULD start using an ERP system such as Quickbooks from the start. One of the biggest issues I have faced is the use of  offline versions of ERP systems that are only accessible to bookkeepers. Avoid this at any cost, because bookkeepers prefer it because they make more money like that. Every time you need a P/L or Balance Sheet, they will charge you for the time it takes them to report it.

The ERP tools will be hard to use to forecast, and hence an internal excel sheet should be used to project. Projections are extremely important, and you should always project high but achievable goals. The excel sheet should contain the key metrics of your company, but they should also contain revenue, gross profit, net profit, cost of goods sold, fixed costs, etc.Startup-Financial-Model¬†is an example of an excel sheet I worked with, but there are many more examples that could be more specific to your business. Remember that key metrics of your company MUST be in your financial model, if you use it correctly, you will soon be making decisions based on this model. Updating the model on a monthly base will also be crucial, take the time to update it and update the targets and forecasts. At the beginning of every month, create a new tab and copy paste last month’s sheet and adjust it accordingly to see how you did as compared to your forecasts. You should always be able to look back and compare how you did as compared to your forecasts at any time.

I have also used a tool called to report our performance to external stakeholders. I highly recommend that tool as well, you can invite all stakeholders and they get access to a dashboard to see how your company is doing. You will also be able to send the stakeholders an update, I recommend you do this on a monthly basis. Guys at have done a great job building the product, I have met them on several occasions and run great inbound marketing strategies.

Hope this was informative, please let me know if you would like me to elaborate on any specifics. You should also read a book called Lean Analytics if you are not sure which key metrics your business should track.

Michael Ghattas

Tech guy deeply interested in startups, growth, AI and just anything exciting. Currently involved with MTL New Tech and Love travelling and exploring new cultures. In my spare time I like to read, write, code, and just hang out with friends. I actively trade the stock market and will be talking about my trades in the blog.