Chutes and Ladders…Remember That Game? It’s As Much Fun in Finance!
When 6- and 7-figure entrepreneurs want to get to the next level in their businesses, I’m the CFO they call to help them leverage their cash and pay down debt to grow their business.
Most entrepreneurs, when we start out, have a long-term goal for our businesses. Whether it’s 6 figures in revenue, 7 figures, or more, we each have a unique vision of what qualifies as “success”. That is point out there on our horizon towards which we are constantly aiming everything: our decisions, our investments, our energy, and our dreams.
Inevitably, there are landmines and opportunities in front of us as we make our way towards the North Star we have defined. In short:
The landmines are the Chutes – these have the capability to set us back in our adventure. Sometimes just a couple of steps; but sometimes all the way to the beginning
The opportunities are the Ladders – these have the capability to jettison us forward towards our goal. Sometimes just by a couple of steps; but sometimes well past our original goals
Pretty simply, just like in our childhood game, we want to avoid the Chutes and hit as many Ladders as we can – but through it, all, still stay on the path to our ultimate outcome.
So here’s where finance and cash flow come it.
In business – the way that we can see those landmines and opportunities far enough ahead of time is through a cash flow forecast.
Think of it as the tool that defines your boundaries for you so that you can actually stay within them, hit as many opportunities as possible, and skip as many landmines as possible, and see and still remain aimed at your goal.
We all know that the path to entrepreneurial success is anything but a straight line! We will drive out of our way – IF WE CAN SEE THEM – to avoid the obstacles and hit every opportunity We will move in all sorts of directions that we didn’t plan on, but – IF WE HAVE A CLEAR FORECAST lighting the way – we WILL get to that north star!
See, the only way to get there is to see these things (good and bad; chutes and ladders) coming at you ahead of time. And, the only way to see them ahead of time, and be able to react to them is with a cash flow forecast that gives you clarity and confidence about what decisions you can make to take advantage of and avoid them, respectively.
Trust me, Finance is Fun. Because every time you can see far enough ahead to take advantage of \an opportunity and shoot way ahead, that’s FUN! So, know your cash – know where it’s coming from, and when; and know when you’re spending it. That is the way to win Entrepreneurial Chutes and Ladders.
Author, Virtual CFO, and Finance Coach
"Your First CFO: The Accounting Cure for Small Business Owners" on AMAZON