Start Up Stories

Spending Quality Time With… Your Numbers!

Posted in Uncategorized by Devon on February 16, 2009

It’s mid-September and looking back, it’s amazing how many business plans we will eventually publish before we finally get it right but, that’s part of the R&D process. The good news is that we are absolutely fearless in our inquiries and not satisfied until we get it right. We are making lists of potential angel investors and still working on executing a business plan that would ultimately be untenable. We are making progress in building a great team, always a good move.

It all looks pretty logical… maybe too logical. In my first start-up, we never really did good financial modeling in the very early days, which is critical, and we burned through too much capital with insufficient margins. In a financial business, with thinner margins, this attention to the numbers in the early days is particularly critical.

Lessons Learned & Questions to Ponder

Even though you won’t really know where the ultimate business model will end-up (my last business we started in museums and ended up in semiconductor factories), never lose the discipline of crunching the numbers in the business plan. Despite occasional high profile successes with the “go do what you love and the money will take care of itself” mantra – don’t forget to run the numbers routinely – it will drive many important decisions — particularly about pricing.

When was the last time you spent a solid 1/2 day looking at your profit and loss statement, actual or proforma? If it’s been more than a month, it’s too long –


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