Who This Helps
This is for founder-operators who need to move from a messy spreadsheet to a clear, approved action plan. It’s pulled straight from the Founder Finance Basics Mission Pack, specifically the Runway Forecast mission. If you’ve ever felt your revenue and cash story don’t match, this is your fix.
Mini Case
Ben’s SaaS revenue grew 30% last quarter, but his bank account stayed flat at $180k. He had 3 different runway numbers floating around—5, 8, and 11 months—which made planning impossible. By building a single forecast, he saw his true runway was 7 months at current burn. This gave him 90 days to either cut burn by 15% or start his fundraising process with confidence. No more panic.
Do This Now (5 Steps)
- Grab your last three months of bank statements and your current monthly recurring revenue (MRR).
- Calculate your average monthly net burn: Cash out minus cash in.
- Divide your current cash balance by that monthly burn number. That’s your core runway.
- Model one change: What if you delayed one hire for 60 days? What if you landed two big deals next month?
- Pick your single, defendable runway number. Write it at the top of a blank document.
Avoid These Traps
- Don’t mix personal and business accounts in your cash number. It blurs the truth.
- Avoid using ‘best-case’ revenue projections. Use your current, reliable MRR.
- Don’t hide from one-time expenses. List them separately so everyone knows the score.
- Skipping the ‘what-if’ model is a classic mistake. Play with one variable to see its impact.
- Never present multiple runway scenarios without recommending one. Decision-makers need a clear call.
- Don’t forget to factor in upcoming tax payments or annual software renewals.
- Avoid using a complex, un-shareable spreadsheet. The goal is a simple one-pager.
- Don’t let perfect be the enemy of good. A good estimate now is better than a perfect one next week.
Your Win by Friday
You’ll have one number—your actionable runway—written down. You’ll also have the start of your Fundraising Readiness Memo: a one-page document that says, “Here’s our cash, here’s our plan, and here’s what we need to decide.” It turns your analysis into a conversation that ends with a green light. Time to get off the spreadsheet rollercoaster.