Management

What to Do If Your Startup is Running Out of Cash

Startups that aren’t sitting on significant cash reserves are currently in a fight for survival

Dave Bailey
Marker
Published in
7 min readMar 25, 2020

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A woman looks serious as she listens on the phone while holding paperwork and sitting in an office chair.
Photo: 10'000 Hours/DigitalVision/Getty Images

OOver the course of just a couple of weeks, economic activity has slowed dramatically. Companies are freezing new purchases in nonessential areas. Consumer spending is slowing down. And investors are fearful as they watch their portfolios tank.

As business owners, these financial challenges mean we have some hard decisions to face, especially when it comes to retaining our staff and managing our dwindling cash reserves.

A lot of people are asking me what other CEOs are doing. While it’s reassuring to know how others are reacting, I encourage you to make decisions based on your specific situation. To that end, here are some of the essential questions to ask yourself in order to successfully lead your company through the coronavirus crisis and to regain control of your cash flow.

1. How much financial risk can you take?

When you spend more than you earn, your business can only exist for so long. The length of time you can survive while making a loss every month is your runway.

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Marker
Marker

Published in Marker

Marker was a publication from Medium about the intersection of business, economics, and culture. Currently inactive and not taking submissions.

Dave Bailey
Dave Bailey

Written by Dave Bailey

CEO of Founder Coach, providing training and mentorship for the next generation of great CEOs. Visit FounderCoach.com for details.

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