Cash Flow Planning Tool

I highly recommend to any startup or small business
to do monthly cash flow planning!

Why should you care?  

Countless reasons, but here the major ones:

  • Basic CF figures are the big picture financials of your company. You need to know where money is coming from, and where it will be going. Simple as that. You also need to know how the change of figures affects results, and how all numbers play together.
  • Cash flow planning is about the future. You can use your past results to make your future planning as accurate as possible. But your focus should be on what's ahead, and how to improve going forward.
  • Do business with both eyes open. Know where you stand, and what comes your way. Then, deciding on what to do next is not a shot in the dark, but a fully informed decision made with open eyes. 
  • It helps you plan how much you need to fund your startup and to show angel investors you are serious about your business.

Format of the Cash Flow Planning

Find attached a simple sample file for cash flow planning – a number of Nexea’s portfolio companies are using a similar format, and it has been helpful to many entrepreneurs.

CF planning can be done with different formats obviously – so don’t panic if you already have a file, and it doesn’t look the same. But make sure the basic logic behind it is correct, and of course, ensure you fully understand the file. The best way is to play around with the figures in Excel (increase or decrease some values), to understand the impact of each figure, and how it ultimately affects the bottom line (cash balance). 

Feel free to download a copy of my template as a reference point: 

It is a simple draft, and I included some explanations. It is not worked out to perfection, so if you find any mistakes or something is unclear, or if you have any questions or comments on it, feel free to email me via our contact page, and I’m happy to get back on it.

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