Finance

Finance

Strategic financial frameworks for startup CFOs and founders. Numbers-driven, decisions-focused. Not financial analysis for its own sake — models that drive decisions, fundraises that don't kill the company, board packages that earn trust.

Keywords

CFO, finance, financial model, burn rate, runway, unit economics, LTV, CAC, fundraising, Series A, Series B, term sheet, cap table, dilution, cash flow, board financials, FP&A, SaaS metrics, ARR, MRR, net dollar retention, gross margin, scenario planning, cash management, burn multiple, Rule of 40, Magic Number, ARPU, payback period, churn, revenue, P&L

Key Questions (Ask These First)

• What's your burn multiple? (Net burn ÷ Net new ARR. >2x is a problem.)
• If fundraising takes 6 months instead of 3, do you survive?
• Show me unit economics per cohort, not blended. (Blended hides deterioration.)
• What's your NDR? (>100% means you grow without signing a single new customer.)
• What are your decision triggers? (At what runway do you start cutting?)

Core Domains

1. Financial Modeling

Build bottoms-up models, not top-down fantasies.

Three-statement model: P&L → Balance Sheet → Cash Flow Headcount cost model: Loaded cost per role × hiring plan × timeline Revenue model: Customers × ARPU × retention × expansion

Projection principles:

• Bottom-up: # customers × ARPU, not "if we get 1% of TAM"
• Three scenarios: Bear / Base / Bull (with clear assumptions for each)
• Monthly granularity for first 18 months, quarterly after
• Every assumption must be labeled and justifiable

2. SaaS Metrics & Unit Economics

Revenue Metrics:

Unit Economics:

Retention Metrics:

Capital Efficiency:

3. Fundraising Finance

Valuation models:

• DCF (Discounted Cash Flow) — for later stage
• Revenue multiples — most common for SaaS
• Precedent transactions — comparable deals
• Venture method — target return backward calculation

Term sheet essentials:

• Valuation (pre-money vs post-money)
• Liquidation preference (1x non-participating is standard)
• Board composition and protective provisions
• Pro-rata rights and anti-dilution
• Option pool (negotiate pre-money inclusion)

Data room contents: See references/investor-reporting.md

4. Cash Management

Runway extension tactics (non-dilutive):

• Negotiate longer payment terms with vendors
• Collect revenue upfront (annual billing discounts)
• Cut discretionary spending (conferences, perks, unused tools)
• Defer non-essential hires
• Revenue-based financing or venture debt

Decision triggers:

• 12+ months runway: Business as usual
• 9-12 months: Start fundraising prep
• 6-9 months: Active fundraising, hiring freeze
• <6 months: Emergency mode — cut to extend

5. Business Health Diagnostic

Four dimensions to evaluate:

Growth & Retention: MRR growth, NRR, churn trends Unit Economics: CAC, LTV, payback, margins Capital Efficiency: Burn multiple, Rule of 40, Magic Number Strategic Position: Market share, competitive dynamics, PMF signals

Rate each: 🟢 Healthy | 🟡 Watch | 🔴 Action Required

Red Flags

• Burn multiple rising while growth slows
• Gross margin declining MoM
• NDR < 100% (revenue shrinks without new churn)
• Cash runway < 9 months with no fundraise in process
• LTV:CAC declining across successive cohorts
• Single customer > 20% of ARR (concentration risk)
• Blended metrics hiding per-cohort deterioration

Reference Files

• references/financial-modeling.md — Three-statement models, projections, budgeting
• references/saas-metrics.md — Complete SaaS metrics guide with calculations
• references/investor-reporting.md — Board financial packages, investor updates, data room

Scripts

• scripts/saas_metrics_calculator.py — Calculate all SaaS metrics from input data
• scripts/financial_model.py — Generate financial projections with scenarios