Financial Planning for Startups

18 to 24 months of runway should be enough...right? Maybe not. The time between primary rounds of venture capital has widened at basically every stage of the startup lifecycle. The average startup now takes over 2 years to raise a Series A after their priced Seed round. That same figure is 844 days between A and B rounds, and a whopping 1,090 days between Series B and Series C. Now - a couple caveats. Obviously this data can only show companies that actually raised their next round, and there are many more that have failed to make it to the following fundraise. Also, while the day counts are striking, I'd actually pay equal or more attention to the change over time. A good rule of thumb is the gap between primary rounds has lengthened about 20%-30% over the past year. So what can startups do if they can't raise the next primary round? 1. Go back to current investors and raise a bridge. These are typically done at flat valuations (or perhaps a little increase) and almost always involve investors already on the cap table. We've seen a dramatic increase in these rounds as a percentage of all priced funding in recent quarters.     2. Scrap together more financing using convertible instruments. Startups are starting to use SAFEs and Convertible Notes between priced rounds in much higher numbers. This introduces some complexity but better than running out of cash.     3. Trim burn rate. Most startups have been looking hard at software spend, fixed costs, and of course headcount over the past year. More of that to come in 2024. No denying the difficulty of the moment for startups, especially those that have already raised venture money. As we've been saying internally for months, this is a wonderful time to start a company and a challenging time to grow one. Salute to the founders out there making it happen! #cartadata #runway #founders #fundraising #startups

I’ve had 5 different people ask me about their early stage startup offer and each time I have told them: DO NOT TAKE IT. Here’s why: These were strong, tenured candidates with at least 10+ years of experience at name-brand mid-stage startups. They were allured by the opportunity to “go earlier and have a bigger impact”. If that is your only motivation, go for it. However, most of the time, you’re also motivated by the equity. Let me tell you plainly: 95% of the time, the equity offered is built on a lie. It is based on the idea that all startups are created equal and they aren’t even close. You get the same equity offer for joining the next Stripe or Facebook as you do if you’re joining a random GovTech company, even though the exit potential is 1/100th in GovTech. This creates a serious issue. Most people just think “early stage startup” implies a $10B+ outcome opportunity. They don’t question it. They ask their friends what equity they got, and they assume the company can be the next Notion, Ramp, or Airbnb. In reality, the best case, home run scenario for your startup might be $1B or even $500M. The founders either delude themselves into thinking this isn’t true, or they know it but of course they won’t admit it. The founders / investors will never give you the equity that would actually be fair, because they structurally can’t. If you are an up-and-comer in your career, going early stage (pre-$1M ARR) can be a great deal. You get paid in learning, and you can easily jump to another more successful company in 3-5 years. But if you are in the prime of your career, with a decade of experience under your belt, beware. Don’t join unless the startup has multiple $10B comps in the public markets, or the founders have a philosophy of offering 2-5x the market standard in equity (to compensate for the lower potential exit value). Some founders are wise enough to do this, but most will just give you the standard offer and expect you to not ask too many questions. P.S. Some founders will just compensate for this by offering strong cash offers. That is totally fine too, as long as you are eyes wide open about it.

Most founders see financial complexity as a hurdle. I help them turn it into a strength. I’ve sat with dozens of founders, watching them drown in numbers, dashboards, and daily stress. I know how easy it is to get lost in the detail. Growth slows, decisions feel risky, and burnout creeps in. But I’ve seen what happens when you flip the script. Financial clarity is about seeing the signals that matter, structuring decisions so you don’t have to second-guess, and building momentum that compounds over time. That’s how you move from chaos to control. Here’s the 5-step process I use with founders who feel stuck: 1. Signal First, Noise Second ⇀ Find the few financial signals that drive your business.  ⇀ Ignore the rest. Most dashboards show too much.  ⇀ I help founders focus on cash flow, margin, and runway. 2. Structure Your Decision Points ⇀ Don’t try to solve every problem at once.  ⇀ Map out the moments when you need to decide.  ⇀ I show founders how to set up regular checkpoints, so they act with intent, not panic. 3. Build Simple Systems ⇀ Growth breaks messy processes.  ⇀ Clean, repeatable systems keep your team aligned and your business flexible.  ⇀ Founders I work with learn to automate what’s routine and clarify what’s critical. 4. Protect Your Energy ⇀ Financial stress drains energy fast.  ⇀ I guide founders to delegate, rest, and focus on big decisions.  ⇀ The goal is resilience, not just survival. 5. Review and Reset ⇀ No plan survives forever.  ⇀ Every month, check what’s working and adjust.  ⇀ That’s how you avoid burnout, spot new risks, and keep moving forward. I’ve watched this framework unlock scale, confidence, and peace of mind for founders across New Zealand and beyond. The complexity doesn’t disappear, but it stops being the enemy. What’s your biggest challenge with financial clarity right now? I’d love to hear what works or what’s holding you back. ------- ➕ Follow Jonathan Maharaj FCPA for finance‑leadership clarity. 🔄 Share this insight with a decision‑maker. 📰 Get deeper breakdowns in Financial Freedom, my free newsletter: https://lnkd.in/gYHdNYzj 📆 Ready to work together? Book your Clarity Session: https://lnkd.in/gyiqCWV2

The best founders don't just think about their next funding round. They think about their funding STACK. And honestly? This shift in thinking is the biggest pattern I'm seeing right now across SXSW Sydney - from FKS community chats, partner & investor conversations, coffee catch-ups with Tractor portfolio companies, and pretty much every other startup event I've been to lately too. It's like something clicked for founders in the last 12-18 months. 𝐇𝐞𝐫𝐞'𝐬 𝐰𝐡𝐚𝐭 𝐜𝐡𝐚𝐧𝐠𝐞𝐝: Founders used to see funding as this linear path: raise seed → burn through it → raise Series A. One round after another. Now they're architecting something completely different. They're building mixed funding stacks. 𝐖𝐡𝐚𝐭 𝐝𝐨𝐞𝐬 𝐭𝐡𝐚𝐭 𝐚𝐜𝐭𝐮𝐚𝐥𝐥𝐲 𝐥𝐨𝐨𝐤 𝐥𝐢𝐤𝐞? Think of it like this: you wouldn't build a tech stack with just one tool, right? You've got your CRM, your analytics, your payment processor, your comms platform. Each one does something specific at the right time. Funding works the same way. 🚜 The founders getting this right are layering different capital types strategically: → Equity capital for the big milestones (seed, Series A, Series B) → Non-dilutive capital for extending runway between rounds → Revenue-based financing when you've got predictable income → Bridge capital when you need 6 months to hit the metrics that'll 2x your valuation It's not about picking one. It's about knowing which lever to pull and when. 𝐈'𝐯𝐞 𝐬𝐞𝐞𝐧 𝐭𝐡𝐢𝐬 𝐩𝐥𝐚𝐲 𝐨𝐮𝐭 𝐝𝐨𝐳𝐞𝐧𝐬 𝐨𝐟 𝐭𝐢𝐦𝐞𝐬 𝐧𝐨𝐰: A founder raises their seed round. Hits $1.5M ARR. Has 8 months of runway left. They COULD raise their Series A now at a $10M pre. Instead, they add $400K of bridge capital. Extend runway by 6 months. Launch their enterprise tier. Hit $2.5M ARR. Then raise their Series A at $18M pre. ̲𝘚𝘢𝘮𝘦 $3𝘔 𝘳𝘢𝘪𝘴𝘦. 𝘉𝘶𝘵 𝘵𝘩𝘦 𝘥𝘪𝘧𝘧𝘦𝘳𝘦𝘯𝘤𝘦? 30% 𝘥𝘪𝘭𝘶𝘵𝘪𝘰𝘯 𝘷𝘴 16% 𝘥𝘪𝘭𝘶𝘵𝘪𝘰𝘯. On a $50M exit, that's $7M more in their pocket. All because they knew when to add a different type of capital to their stack. 𝐇𝐞𝐫𝐞'𝐬 𝐰𝐡𝐚𝐭 𝐈'𝐦 𝐬𝐞𝐞𝐢𝐧𝐠 𝐰𝐨𝐫𝐤: Founders are using non-dilutive capital to: → Buy time to hit the metrics that actually move valuation → Launch revenue-generating features before their next raise → Close enterprise deals they've been nurturing for months → Test profitability without needing to raise at all And the best part? None of this is about avoiding equity funding. Most founders I work with WANT to raise VC. They're building venture-scale businesses. But they're being strategic about when they raise and how much they give up. The mixed funding stack approach gives them options. And options mean you're making decisions from a position of strategy, not desperation. How are you thinking about your funding stack? (send me a DM if you’ve ever got questions on how Tractor Ventures may help!). 🙂

₹77,080 Crores allocated by the Government of India for startups and manufacturing in 2025. Yet most founders are still chasing VC money. I work with startups daily, and it surprises me how many don't even know these schemes exist. Here's what's available right now The Big Picture: → Deep Tech & Startup Fund: ₹30,000 Cr → MSME Budget Outlay: ₹23,168 Cr → Startup India Fund of Funds: ₹10,000 Cr → PLI Electronics & IT: ₹9,000 Cr → PLI Auto Components: ₹2,819 Cr → PLI Textiles: ₹1,148 Cr → Startup India Seed Fund: ₹945 Cr This is just the major allocations - there's more buried in smaller schemes. Let me break down what you can actually access based on your stage [1] For Early Stage Startups: 👉🏼 Startup India Seed Fund: Up to ₹50L per startup 👉🏼 SAMRIDH Scheme: Up to ₹40L grants 👉🏼 Atal Innovation Mission: Up to ₹15L for prototypes Most founders think these are too small. But remember, this is non-dilutive capital that can get you to revenue stage. [2] For Revenue Stage Companies: 👉🏼 CGTMSE: Up to ₹2 Cr collateral-free loans 👉🏼 Stand-Up India: ₹10L to ₹1 Cr for SC/ST/Women entrepreneurs 👉🏼 Multiplier Grants: Up to ₹10 Cr for R&D projects This is where it gets interesting. Revenue-stage companies have the best shot at accessing larger amounts. [3] For Manufacturing: 👉🏼 PLI schemes across 14+ sectors 👉🏼 Significant incentives for domestic production 👉🏼 Focus on electronics, auto, textiles If you're in manufacturing, you're literally sitting on a goldmine of incentives. The challenge? Most founders don't know how to navigate the application process. Here's where to start: - Startup India Portal [https://lnkd.in/gBdAH52D] - myScheme Portal [myscheme.gov.in] - SIDBI Portal [sidbi.in] - AIM Portal [aim.gov.in] - MeitY Startup Hub [msh.meity.gov.in] What you actually need: ✓ DPIIT registration for startups ✓ Proper documentation ✓ Clear business plan ✓ Compliance records ✓ Incubator partnerships (for some schemes) I've seen founders spend months preparing pitch decks for VCs, but won't spend a week getting their documentation ready for government schemes. The reality is Government funding is often cheaper, comes with less dilution, and has better terms than VC money. But it requires patience and proper documentation. #startupfunding #manufacturing #debtfunding

Stop chasing IPOs. Most founders obsess over going public. But IPOs are only 4% of all exits. Here's how to pick the exit strategy that actually makes sense for YOUR startup... 80% of successful exits are acquisitions. Average value: $155.5M Time to close: 6.4 years Compare that to IPOs: Average value: $1.6B (sounds amazing, right?) Time to close: 9.4 years Success rate: Much lower So how do you choose? Ask yourself these 4 questions... What's your revenue run rate? If you're under $100M ARR, acquisition probably makes more sense. Public markets want predictable, large-scale revenue. How patient are your investors? IPOs take 3+ years longer than acquisitions. VCs with 7-year fund cycles might push for faster exits. What's your market doing? In hot sectors like AI, strategic acquirers pay premium multiples. In mature markets, IPO might be the only path to fair valuation. How much control do you want to keep? Acquisitions often mean losing operational control. IPOs let you stay CEO but add massive regulatory burden. The secret most founders miss... Your exit type should match your business model. B2B SaaS with sticky revenue? Perfect IPO candidate. Consumer app with network effects? Acquisition target. Deep tech with long development cycles? Strategic merger. Don't pick your exit strategy in a vacuum. Talk to founders who've been through each path. The right exit isn't about maximum dollars. It's about maximum alignment with your goals, timeline, and reality. --- Need help building your fundraising strategy? I'm Nidhi Kaushal, founder of Team Flexbox. We've helped 1200+ founders with strategic fundraising support. Click the link in my profile to book a 1:1 call or DM me directly.

Practically every founder I spoke to over the last 4 weeks is now trying to become profitable with the resources available. These Founders are all coming from startups that already raised at least one round of financing. Anything from $500k-$3.5m. Still at Seed stage, where we typically expect the focus to be on building to finding PMF not on profitability. They are now becoming more intentional with their spending, both internally and externally. And they are prioritising products and efforts which point directly towards revenue. What changed? There’s less easy flowing money this year. And raising has become increasingly more difficult. So they are now conscious that their current bank balance will not last forever. And that might be a good thing… Which takes us back to basic business fundamentals 101: A business exists to solve a problem AND to be profitable. Over the last few years we might have focused too much on growth (fuelled by VC money) and ignored or delayed profitability (refer to VanMoof going bankrupt). And while it sounds sexy to just focus on the product, a real business, particularly in the current economic climate, cannot postpone being cash flow positive forever. What can you spend less on? How can you focus your product efforts to make more money? Today, your top priority is to be profitable and survive. #productmanagement #startups #founders

31% of employees receiving grants were provided with ISOs. But most are confused by them. Here’s what you need to know: → What are ISOs? ISOs (Incentive Stock Options) let employees buy company stock at a set price. They provide the right, not the obligation, to purchase shares. But there’s a catch: only $100K of ISOs can become exercisable per year—the rest are treated as NSOs. Key Terms to Know: • FMV – Fair Market Value (current price) • Grant Date – When the option is awarded • Strike Price – Price at which you can buy • Exercising – Buying the stock • Vesting – When shares become eligible to exercise → Why They Matter: ISOs let employees participate in company growth without upfront cash comp. They also create “golden handcuffs”, incentivizing employees to stay until options become valuable. But they come with risks, especially in startups. Example: • Strike Price: $1 • FMV at Exercise: $5 • Exercising 1,000 shares → Cost = $1,000 • Worth at FMV = $5,000 The $4,000 gain is called the bargain element—and it impacts taxes. How ISOs Are Taxed: To get long-term capital gains rates: → Hold 1+ year after exercise → Hold 2+ years after the grant date Sell early? The gain gets taxed as ordinary income instead. The AMT Catch: Unlike NSOs, ISOs aren’t taxed at exercise for regular income tax. BUT—the bargain element triggers Alternative Minimum Tax (AMT) calculations. When exercising, AMT considers: → The bargain element (FMV – Strike Price) → The number of shares exercised → Your income Miss this step, and you could owe thousands in surprise taxes. Strategies to Manage AMT: Exercise in stages – Avoid a huge AMT hit in one year Time exercises carefully – Align with income levels Plan before an IPO – A stock price surge can mean a massive AMT bill Early Exercise Option: Some companies allow early exercise, meaning you exercise before vesting to start the holding period early. Final Note: It can be complicated at first (as it already is). Here’s a visual showing an example of what this could look like: ISOs are powerful but require planning. If left unchecked, AMT can create a huge tax burden if ignored. Got ISOs? - - - - - - - - - - - - - - - - - This is not financial or tax advice and purely educational. Always plan before acting. Like money visuals to spice up your finances? Every week I send a money visual that explains finances in 5th grader language. Join the fun here: https://lnkd.in/gJC9mTQH

Your Startup's cap table starts out a fresh, juicy pie: But How Much Can You Afford to Give Away Before It’s Just Crumbs? That’s the Equity Trap 🥧 Here’s the usual slice of the pie: 🔸 𝗖𝗼-𝗙𝗼𝘂𝗻𝗱𝗲𝗿𝘀: It's more than just splitting the pie evenly; It's about recognizing each founder's current and future contributions, and slicing accordingly 🔸 𝗔𝗱𝘃𝗶𝘀𝗼𝗿𝘀: They usually get about 0.5 to 1% over two years in exchange for advice and guidance.  🔸 𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀:Their slice depends on their investment and your valuation. 🔸 𝗘𝗺𝗽𝗹𝗼𝘆𝗲𝗲𝘀:  Early team members might get equity instead of top salaries, making them feel like part-owners and boosting their motivation. 𝗔𝗱𝗷𝘂𝘀𝘁𝗶𝗻𝗴 𝘁𝗵𝗲 𝘀𝘁𝗼𝗰𝗸 𝗼𝗽𝘁𝗶𝗼𝗻 𝗽𝗼𝗼𝗹 𝗮𝗳𝗳𝗲𝗰𝘁𝘀 𝗲𝘃𝗲𝗿𝘆𝗼𝗻𝗲’𝘀 𝘀𝗵𝗮𝗿𝗲 𝗱𝗶𝗳𝗳𝗲𝗿𝗲𝗻𝘁𝗹𝘆: ➔ Do it before new investors arrive — the original team's share shrinks; do it after — the newcomers feel the squeeze. ➔ Launching an IPO opens up your pie to the public. Issuing more shares later means everyone’s piece gets thinner. ➔ Slice too generously, too soon, and your own portion shrinks. Look at Impact Venture's graph for a visual on how "Founders Equity Ownership Over Time" evolves 👇 𝗧𝗵𝗲 𝗽𝗲𝗿𝗶𝗹𝘀 𝗼𝗳 𝘀𝗵𝗮𝗿𝗲 𝗱𝗶𝗹𝘂𝘁𝗶𝗼𝗻: with each piece of the pie shared, your stake becomes a little 𝘭𝘦𝘴𝘴 𝘴𝘸𝘦𝘦𝘵. 𝗗𝗼𝗱𝗴𝗲 𝘁𝗵𝗲 𝗗𝗶𝗹𝘂𝘁𝗶𝗼𝗻 𝗗𝗶𝗹𝗲𝗺𝗺𝗮: 🔸 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗘𝗾𝘂𝗶𝘁𝘆: Keep a larger piece by not giving away too much too early. Time funding for better valuations. 🔸 𝗞𝗲𝗲𝗽 𝗮 𝗰𝗹𝗲𝗮𝗿 𝗰𝗮𝗽 𝘁𝗮𝗯𝗹𝗲: Know who owns what. 🔸 𝗚𝘂𝗮𝗿𝗱 𝘆𝗼𝘂𝗿 𝘀𝗲𝗰𝗿𝗲𝘁 𝘀𝗮𝘂𝗰𝗲: Secure your IP to attract investors. 🔸 𝗦𝗺𝗮𝗿𝘁 𝗦𝗵𝗮𝗿𝗲 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝘆: Master share distribution and conversions. 🔸 𝗘𝗺𝗯𝗿𝗮𝗰𝗲 𝗦𝗮𝗳𝗲𝗴𝘂𝗮𝗿𝗱𝘀: Use clauses like reverse vesting for stability. Master startup equity to ensure everyone enjoys a fair share while securing a satisfying slice for yourself. Startups.com - 𝗘𝗺𝗽𝗼𝘄𝗲𝗿𝗶𝗻𝗴 𝗬𝗼𝘂𝗿 𝗦𝘁𝗮𝗿𝘁𝘂𝗽'𝘀 𝗦𝘂𝗰𝗰𝗲𝘀𝘀 𝗦𝘁𝗼𝗿𝘆 🚀 #Fundraising #Startups #Strategy #Tech #Investment #VentureCapital

Overcoming Cash Flow Hurdles as a Start-Up Fashion Brand 💸 Recently, I asked small-scale fashion brands about their biggest challenges, and cash flow topped the list! Cash flow can be tricky. Often, unless you have significant investment backing, funds can be very tight. I’m no financial adviser, but here are a few tips for handling cash flow based on my experience of working with start-ups: ✅ From a Design & Production Perspective: ↳ Get Clear on Your Vision: A clear direction enables you to create a strong brief for potential freelance designers, ensuring accurate quotes and helping to avoid unnecessary costs. ↳ Choose the Right Partners: Take your time to research and collaborate with designers, manufacturers etc who align with your vision, don’t rush into decisions. ↳ Research and Plan Costs: This one is important! Ensure you thoroughly research and anticipate fees at every stage. E.g. design, samples, shipping, clearance fees, etc. ✅ From a Sales Perspective: ↳ Focus on Quality Over Quantity: Perfect a few key products instead of launching a large range. ↳ Avoid Overproduction: Where possible, utilise low MOQ and split colourways. Consider options like dropshipping or print-on-demand to minimise excess stock (product and supplier dependent). ↳ Stagger Product Releases: Spread out product drops to maintain steady cash flow and maximise marketing opportunities. ↳ Use Preorders and Bundle Deals: Gauge demand through preorders and boost sales with strategic bundle offers. ↳ Offer Payment Plans: This makes larger purchases more accessible and manageable for your customers. These are just a few cash flow tips, but I’d love to hear more, especially from start-ups that feel they’ve got cash flow under control! Drop your tips in the comments to support your fellow start-up brands! 🙌🏻 —— ✍🏻 Sign up to our weekly newsletter! ttps://lnkd.in/gq7Ja_7g 🩷 I am currently on maternity leave, so replies may be delayed. My assistant designer will pick up any design inquiries. Thanks so much for your patience and understanding! —— Lauren Director of Friday’s Child Studio