Besides an ambitious business plan, much remains to be done to make startups financially and administratively investor-proof. In order to act according to your fundamentals, you cannot start off too soon. Being late for that itself also costs time, and you need that to work on matters such as your track record, which is equally essential.
Hardly anything that has to be “done well” is fun, challenging, or inspiring. And yet… you must still do it.
Professional, upstanding, powerful. Practical and flawlessly-executed. Withstanding setbacks, but also resistant
to excessive growth. Conforming to all internal benchmarks, and all external requirements.
The quality of the financial and administrative fundamentals of your start-up and scale-up is largely the
determining factor for the growth of your wings and flight power. Know and understand that financial and
administrative junk, mess, and chaos requested by potential investors is a big red flag. And right so, let’s face it:
How would you respond to this if you were to be a potential investor?
Please keep the following in mind:
The last thing a startup or scale needs is financial and administrative turmoil and uncertainty, or tension and thrill.
A solid financial and administrative foundation is a “conditio sine qua non” for sustainable business success.
In our experience, start-ups may seem “fast and furious,” but often the best companies – with carefully controlled
growth – work much differently. A professional nature in all management components forms the basis for a
prosperous cooperation with clients, employees, investors—and for lasting business success.
Administrative and financial unrest and weakness affects the strength of companies in all stages of their
development, specifically also start-ups.
So, the five essential questions are…
1. How fast did you exhaust the money received from investors? In other words, what is your burn rate?
2. What are the total (development) costs up to and including the moment of market introduction?
3. What is the cost per unit of product or service?
4. What is the relationship between your growth ratio compared to the (potential) profitability?
5. To whom do you turn to regarding these questions?
Count on us, also in building and investor proofing of your financial and administrative fundamentals.
Arjan Bisseling / Christiaan Nederhof