Financial planning for startups – easier than you might think!
How to remain informed without spending too much time?
If you are investing in startups either as a venture capital firm or angel investor, most probably you will have thought about it many times. Yes, the founding team runs the company but your money is at risk. You want to make sure that they are making progress towards reaching their objectives so you check in with them on regular basis.
Except…when it comes to financial planning and monitoring financial performance, in most cases this is very inefficient. You require them to build and update spreadsheets with the information you want to know. Then those spreadsheets are sent to you. By the time you check them things have already changed and you analyze outdated information that someone spent hours to put together. That time would have been better spent building the product or winning more clients.
And this is another reason why we built Tailwind.
Our main target audience are folks running small and medium services businesses. This includes most early stage startups. Tailwind lets them forecast their cash flows and also analyze their past performance by spending just 5-10 minutes per week as it is visualized, automated and very easy to use. Your Tailwind forecast updates itself every time you log in thanks to smart integration with your bank account.
Entrepreneurs are always short of time and therefore they love using Tailwind. And they can invite you as an investor to access their account so that you can view the very latest when you have time.
What have they been spending money on? How much have they received from their clients and who are the largest clients? How much revenue do they expect to receive next month? What do they plan to spend on during next 3 months? How much “runway” is still left if the revenue and expense trends remain as forecasted?
You can find these and many other answers by logging in the Tailwind accounts of your portfolio companies. No more time wasted on updating spreadsheets, always the most updated information.
It might not work for your “A series and beyond” companies as their business volumes and complexity may require other tools. But for pre-seed and seed stage startups it will be perfect!
