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CA Rahul Nahata
ย โขย
Upworkย โขย 3m
๐ด 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. ๐ก Thatโs where Financial Planning & Analysis (FP&A) steps in โ and becomes your startupโs secret weapon. ๐ What is FP&A? FP&A is the process of using financial data to plan, analyze, and support better decision-making. It includes: ๐ Budgeting & Forecasting ๐ Cash Flow Planning ๐ Scenario Analysis ๐ Performance Tracking ๐ Strategic Financial Modeling In simple words: It helps you know where your money is going, and where it should go. ๐ Why FP&A is Critical in Early-Stage Startups ๐ธ 1. Control Your Burn Rate Most startups burn $10Kโ$100K/month. Without FP&A, you wonโt know: How long your runway is What costs can be optimized When youโll need the next funding round With FP&A: You can forecast runway down to the week, and plan 6โ12 months ahead. ๐ 2. Track ROI on Every Spend Whether itโs hiring, ads, or tools โ FP&A helps you calculate: Cost vs. return of each action Break-even timelines Profit margins by product or service ๐ฐ Know if spending โน1 lakh on ads is actually giving you โน1.5 lakh in return โ or burning cash. ๐ 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? Whatโs the cash impact? Which one improves margin? ๐ 4. Plan Fundraising Smartly Investors want numbers, not just vision. FP&A provides: 12โ18 month financial projections Unit economics like CAC, LTV, Payback Period Clean dashboards that increase investor trust ๐ง 5. Keep Your Team Aligned Everyone on your team knows the targets: Revenue = โน5 Cr this year Monthly cost = < โน3 lakh Growth = 10% MoM No more guessing. Just goals.
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