Private equity
Post LinkedIn lead magnet · Private equity
One of my favorite metrics even though it can sting... cash runway when everything else disappears 👇 ~~~ 📥𝗧𝗟;𝗗𝗥: Grab the template 👉 https://lnkd.in/eDzuV6Mf ~~~ 𝟭. 𝗖𝗮𝘀𝗵 𝗶𝗻 𝘆𝗼𝘂𝗿 𝗯𝗮𝗻𝗸 𝗮𝗰𝗰𝗼𝘂𝗻𝘁 1. Open your bank website 2. How much cash is sitting in there right now? 3. Enter that number in cell C6 ⸻⸻⸻ 𝟮. 𝗔𝗱𝗱 𝗸𝗻𝗼𝘄𝗻 𝗿𝗲𝗰𝗲𝗶𝘃𝗮𝗯𝗹𝗲𝘀 If you're 𝗰𝗲𝗿𝘁𝗮𝗶𝗻 you're going to collect some AR, enter that in cell C7. Just enter $0 to be more conservative. ⸻⸻⸻ 𝟯. 𝗦𝘂𝗯𝘁𝗿𝗮𝗰𝘁 𝘂𝗽𝗰𝗼𝗺𝗶𝗻𝗴 𝗽𝗮𝘆𝗮𝗯𝗹𝗲𝘀 Subtract out known payables that are due shortly or spoken for: - salaries - vendor payments - estimated tax payments These go in cell C8. ⸻⸻⸻ 𝗧𝗵𝗲 𝗿𝗲𝘀𝘂𝗹𝘁: Add the numbers up... You get a snapshot of "net cash left today" (cell C10). ⸻⸻⸻ 𝗧𝗵𝗲𝗻, 𝗹𝗶𝗻𝗸 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀 Go to your three statement model. (𝘺𝘰𝘶'𝘷𝘦 𝘨𝘰𝘵 𝘰𝘯𝘦, 𝘳𝘪𝘨𝘩𝘵?) Take your total monthly expenses and link them through column E. 𝗙𝗼𝗿𝗴𝗲𝘁 𝗥𝗲𝘃𝗲𝗻𝘂𝗲. Expenses only. (Note: if you want to be more precise, link your free cash flow instead, but strip out revenue flowing through AR) ⸻⸻⸻ 𝗧𝗵𝗲 𝗿𝘂𝗻𝘄𝗮𝘆 Time to get real. Column H calculates how many months of runway you have right now, expenses only, assuming you never generate another dollar of revenue or raise capital. This can hurt. I know. It can also be extremely valuable. I call it "Doomsday Runway." How many months of runway do you need to sleep at night? See if you can maintain (or ideally, stay above) that number. Update this analysis monthly and keep track on a chart. It's a great visual. Hopefully, this simple exercise can give you peace of mind. From there, everything else is upside. Hope this helps 🙂. ⸻⸻⸻ 𝗠𝗼𝗱𝗲𝗹𝗶𝗻𝗴 𝘄𝗶𝘁𝗵 𝗔𝗜 𝘄𝗼𝗻'𝘁 𝗵𝗲𝗹𝗽 𝘂𝗻𝗹𝗲𝘀𝘀 𝘆𝗼𝘂 𝘂𝗻𝗱𝗲𝗿𝘀𝘁𝗮𝗻𝗱 𝘁𝗵𝗲 𝗳𝘂𝗻𝗱𝗮𝗺𝗲𝗻𝘁𝗮𝗹𝘀. 🎓 These models run the business 👉 https://bit.ly/FMECourses
Mécanisme lead magnet
Grab the template 👉 https://lnkd.in/eDzuV6Mf
