11 practical frameworks for founders who want to understand their business — not just hand it off to an accountant.
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Guides are a starting point. The Sprint builds your actual model in 1–3 weeks.
Most founders know they have “X months of runway.” Almost none trust the number. Here’s how to build a model that actually tells you when you’ll run out.
The most common runway formula: cash balance divided by monthly burn. Simple — and dangerously incomplete. It assumes constant burn, ignoring seasonality, payroll changes, contract renewals, and quarterly tax bills.
A real runway model maps cash inflows and outflows week by week for 13 weeks, then month by month for 12–18 months. Every significant cash event gets its own line.
A profit and loss statement tells you what happened. It doesn’t tell you what to do next.
Gross burn. Net burn. Burn multiple. What each one means and what it signals.
The data room is open. Here’s what a sophisticated investor will pull apart.
Every hire changes your burn, your runway, and your margin. Here’s how to model it before you make the offer.
A $100K salary costs $130K–$145K all-in when you factor in payroll taxes, benefits, equipment, software, and onboarding time. That’s the number to model — not the salary.
The average founder waits 23 days after month-end. Here’s what causes the lag and how to get to 10 business days.
Days 1–3: bank feeds reconciled, all transactions categorized. Days 4–6: AR aging reviewed, accruals posted. Days 7–8: P&L reviewed for anomalies. Days 9–10: financial package assembled and delivered.
LTV, CAC, payback period. Three numbers that determine whether your business is worth building at scale — and whether investors will fund it.
The income statement shows what you earned. The cash flow statement shows whether the business is actually alive. Most founders have never read one closely.
Accrual accounting recognizes revenue when earned, not when collected. If you invoice $200K in March and collect it in May, March’s P&L looks great — but your March cash flow statement tells the truth.
Revenue on paper is not cash in the bank. The gap between the two — your accounts receivable — is where most cash crunches actually happen.
Days Sales Outstanding measures how long it takes to collect payment after invoicing. The lower the number, the faster your cash moves.
Most founders hire a bookkeeper when they need a strategist, a controller when they need a CFO, and a CFO when they needed one six months ago. Here’s how to know where you actually are.
| Role | What they do | Time horizon |
|---|---|---|
| Bookkeeper | Records transactions, categorizes expenses, reconciles accounts | Past |
| Controller | Ensures accuracy, manages close process, owns reporting | Past & present |
| CFO | Strategy, capital allocation, forecasting, investor relations | Present & future |
A fractional CFO gives you the third row, part-time, at a fraction of the cost of a full-time hire. Most growth-stage companies need this before they can afford the full-time version.
Most company budgets are aspirational fiction. They’re built top-down from revenue targets, reviewed once a year, and ignored by March. Here’s how to build one that actually guides decisions.
Start with what you know for certain: fixed costs (payroll, rent, subscriptions). Then layer variable costs tied to real revenue drivers — not hoped-for revenue. Finally, add conservative revenue based on pipeline and historical conversion, not targets.