Back
CA Rahul Nahata
•
Upwork • 3d
🔴 90% of startups fail. But do you know why? Not because of bad products. Not because of lack of demand. But because they run out of cash and make poor financial decisions. 💡 That’s where Financial Planning & Analysis (FP&A) steps in — and becomes your startup’s secret weapon. 🚀 What is FP&A? FP&A is the process of using financial data to plan, analyze, and support better decision-making. It includes: 📊 Budgeting & Forecasting 📊 Cash Flow Planning 📊 Scenario Analysis 📊 Performance Tracking 📊 Strategic Financial Modeling In simple words: It helps you know where your money is going, and where it should go. 📌 Why FP&A is Critical in Early-Stage Startups 💸 1. Control Your Burn Rate Most startups burn $10K–$100K/month. Without FP&A, you won’t know: How long your runway is What costs can be optimized When you’ll need the next funding round With FP&A: You can forecast runway down to the week, and plan 6–12 months ahead. 🔁 2. Track ROI on Every Spend Whether it’s hiring, ads, or tools — FP&A helps you calculate: Cost vs. return of each action Break-even timelines Profit margins by product or service 💰 Know if spending ₹1 lakh on ads is actually giving you ₹1.5 lakh in return — or burning cash. 📉 3. Make Data-Driven Decisions, Not Gut Calls Imagine choosing between hiring a new sales lead or launching a new feature. FP&A helps you simulate both cases: What happens to revenue in 3 months? What’s the cash impact? Which one improves margin? 📅 4. Plan Fundraising Smartly Investors want numbers, not just vision. FP&A provides: 12–18 month financial projections Unit economics like CAC, LTV, Payback Period Clean dashboards that increase investor trust 🧠 5. Keep Your Team Aligned Everyone on your team knows the targets: Revenue = ₹5 Cr this year Monthly cost = < ₹3 lakh Growth = 10% MoM No more guessing. Just goals.
More like this
Recommendations from Medial
Download the medial app to read full posts, comements and news.