How to Use Financial Planning for Business Growth

33% of CEOs don't trust their CFOs. The 5 areas I focus on (first 90 days): 𝟭) 𝗥𝗲𝗱𝘂𝗰𝗲 𝗘𝘅𝗽𝗲𝗻𝘀𝗲𝘀 The first thing I do with a new client is lower their expenses. This provides a quick win and frees up resources. Common cost-cutting opportunities I see: • Extra licenses • Unused subscriptions • Costs that feel worth it but are not –– 𝟮) 𝗦𝗵𝗮𝗿𝗲 𝗜𝗻𝘀𝗶𝗴𝗵𝘁𝘀 𝗖𝗹𝗲𝗮𝗿𝗹𝘆 If the books are messy → I clean them up. If the books look good → I put together the core financial statements and make sure everyone understands them. I like to involve the whole team by opening the curtains wide on the company’s financials. This increases trust and accountability. –– 𝟯) 𝗢𝗽𝘁𝗶𝗺𝗶𝘇𝗲 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗣𝗿𝗼𝗰𝗲𝘀𝘀𝗲𝘀 I work with clients to streamline: A) Invoicing Many of the cash flow issues I see with clients can be traced back to slow collections. So I make sure invoices are going out in the correct amount and in an easy-to-understand format. B) Closing the books faster I understand the urge to close the books and move on. But clean books don’t mean much if you don't study them shortly after closing. That’s where I work with clients to get their books ready in about half the time. The result is ample time for reviewing performance. C) Monthly financial reviews A good financial review = meeting with the accounting team to study the P&L and Balance Sheet and investigate any budget variance Your goal is to explain each variance and put together an action plan to reverse any concerning trends. –– 𝟰) 𝗖𝗿𝗲𝗮𝘁𝗲 𝗮 𝗦𝘁𝗿𝗮𝘁𝗲𝗴𝗶𝗰 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗣𝗹𝗮𝗻 We set goals and KPIs, determine what’s doable, and come up with a specific roadmap. For your strategic plan to work, it needs to tie back to the financials and be broken out into manageable steps. –– 𝟱) 𝗜𝗺𝗽𝗿𝗼𝘃𝗲 𝗖𝗮𝘀𝗵 𝗙𝗹𝗼𝘄 𝗠𝗮𝗻𝗮𝗴𝗲𝗺𝗲𝗻𝘁 I’ve yet to work with an SMB that didn’t have any room for improvement here. Collections tend to cause the lion’s share of cash flow issues. But clients often overlook the other side of the equation: when and how they pay their own bills. It’s pretty common for owners to pay bills as soon as they get them. But I don’t recommend it. It's better to wait until the day they’re due and set them up for autopay. This way you keep cash in the business longer without running the risk of dinging your credit. Took me a LOT of scrambling in my early days to have this clarity... But after helping over 75 SMBs, I feel confident these are the first steps a CFO should take with a new client. If you enjoyed reading this, let me know and follow me for more strategic finance, SMB, and business content. — Need help with your finances? Feel free to send me a DM. Always happy to help.

Here's how I'm doing budget planning this year. First - let me be real. I’ve struggled to build budget models that are both practical and aspirational. And I've learned from lots of "doing it wrong." They need to be grounded in reality—actual data, actual constraints—but they also have to make space for growth. Without that, it’s just a spreadsheet exercise, not a plan for the future. Over time, I’ve found a framework that works—one that’s helped both in scaling a service business and a software one. It starts with this truth: Growth is King. Growth isn’t just a goal; it’s the compass, the drive, and the path forward. It answers questions like: -> Does this decision help or hurt our growth rate? -> Are we investing in the right places to unlock future growth? Growth creates its own momentum—and its own challenges. The “S Curve” of scaling means every growth milestone presents a new set of problems to solve. Success requires starting the next curve while still climbing the current one. Every budget needs to reflect the centrality of growth. It is the goal, the guide, and the reality check. With that in mind, here’s how I am building our FY25 budget: The 3 Financial Plans 1. The Base Plan (60% confidence): This is the plan grounded in reality but pushing toward growth. 🔸How to make it: - Use the average revenue growth from the last 4 months as your driver for the next 12. Retain growth gets hard over time. This isn't a slam dunk. This is still hard, but achievable. It's based on reality - what you have done before. - Build hiring, bonuses, and investments around maintaining that growth rate. - Base budgets for sales, marketing, and engineering are modeled top-down. This is the budget everyone sees. It’s hard, but it’s achievable. It becomes the foundation. 2. The Stretch Plan (10% confidence): This is the “stars align” plan, designed to break out of incrementalism. It’s where you push beyond comfort zones and bet on the extraordinary. How to make it: 🔸Increase your base plan revenue growth by 20%. 🔸Assume perfect execution: GTM firing on all cylinders, flawless teamwork. This is where magic happens, but only if you’ve got the right conditions. Who sees it? Only the management team—don’t show this widely. This is for dreaming, not managing. 3. The Worst-Case Plan (90% confidence): What if we miss? Planning for setbacks allows you to stay steady in the face of turbulence. How to make it: 🔸Decrease the base plan revenue growth by 20%. 🔸Keep burn steady from the base plan (most important part) 🔸Focus on cash flow to understand the financial runway if growth slows. This plan isn’t about panic; it’s about clarity. It answers, "what happens if we don't hit the goal and have already made investments." This is the, "I can sleep at night" plan. Do we have the cash to sustain? It ain't perfect. But it is directional right and the team aligned. Stay Supered⚡ -Matt P.S. I'll send the budgeting template via DM. Let me know via comment.

Growing businesses often make this costly mistake: As your company scales beyond $10M in revenue, the financial complexity doesn't just increase - it multiplies. What worked at $5M won't cut it at $10M. I've spent two decades working in finance and here's what's crystal clear: Finance isn't just about tracking numbers - it's about making strategic decisions that impact every aspect of your business. Especially these days. You need more than just basic bookkeeping. You need sophisticated financial planning that can: - forecast cash flow across multiple revenue streams - analyze customer acquisition costs at scale - track profitability by product line - model different growth scenarios Recently, I worked with a $15M company that uncovered $800K in untapped profit potential they weren't seeing. Stuff that would have easily been unseen if they did not have someone properly look at their finances. Here's what robust FP&A (financial planning & analysis) delivers as you grow: - strategic resource allocation - early warning systems for potential issues - data-driven decision making - clear visibility into performance metrics The bigger your business gets, the more critical FP&A becomes. It's not just about tracking where your money went - it's about understanding where it should go next. #financialpuzzlessolved #finance #growth

Your money will take you wherever you wish Money is something you can control and will keep you on track. I help small business owners with their finances, and efficient financial management is critical for the success and growth of any small business, especially for private clinician owners. One effective strategy is to retain and distribute money into different buckets. Here’s a step-by-step guide to help you implement this approach: Step 1: Assess Your Income and Expenses ⌦ Begin by thoroughly analyzing your clinic’s monthly income and expenses. ⌦ Identify fixed and variable costs, such as rent, utilities, salaries, supplies, and unexpected expenses. Step 2: Set Up Different Buckets ⌦ Create distinct financial buckets for different purposes. Common buckets include: ✔︎ Operating Expenses: Cover daily operational costs. ✔︎ Emergency Fund: Save at least 3-6 months’ operating expenses. ✔︎ Growth Fund: Allocate funds for future investments and expansion. ✔︎ Tax Fund: Set aside money for tax obligations. ✔︎ Profit Fund: Reserve a portion of your income as profit to reinvest in your business or for personal savings. Step 3: Automate the Distribution ⌦ Use accounting software to automate the distribution of funds into each bucket. ⌦ Set up automatic transfers from your main account to the designated buckets after every deposit. Step 4: Monitor and Adjust Regularly ⌦ Regularly review your financial allocations and make adjustments as needed. ⌦ Track the performance of each bucket and ensure they align with your clinic’s goals and financial health. I recently worked with Dr. Chris, who implemented a bucket system to manage his clinic's finances better: → 40% of his income to operating expenses → 20% to an emergency fund → 15% to growth → 15% to taxes → 10% to profit Within a year, Dr. Chris's clinic had: → a solid financial cushion → invested in new equipment → hired additional staff The outcome: Patient satisfaction improved and increased his clinic’s revenue by 25%. Distributing your income into different financial buckets will: → provide stability → prepare you for unexpected expenses → facilitate growth You can automate these processes and regularly review your allocations. You can ensure your clinic remains financially healthy and poised for success. How do you manage your clinic’s finances? I hope you had a lovely 4th of July yesterday!

As a business owner, making money is often the easy part. But managing it? That’s where people start falling off. Here’s how the business owners that actually make it manage their dollars: Cash flow problems, unexpected expenses, and poor investments can quickly take a once profitable business and run it into the ground. So whether you’re at the freelancer stage or growing into a full-blown agency, the basic principles of money management that I drop in this post will always be relevant. When you're first starting, keep a close watch on your expenses. Subscriptions, A bit of marketing spend, Maybe some insurance might seem small, but they add up. Know what you’re spending and why. Make it a habit to set aside money for taxes from the get-go, and have a safety net in place for those inevitable slow periods. As you start landing more clients, your costs will increase. This is when you’ll start considering Outsourcing tasks, Investing in better software, and Spending more on marketing to bring in more business. It’s easy to get excited and overspend, but stick to a budget and be smart about where your money goes. Diversify your income streams and avoid depending too much on just one or two big clients. When you move to the next level and start hiring employees or renting office space, your financial responsibilities will multiply. Now you’re looking at Payroll, rent, Employee benefits, and Legal compliance. You MUST have effective cash flow management at this stage or you’ll sink quickly. Be sure to: 1) Forecast Regularly: Keep a close eye on your cash flow projections. Update them monthly, if not weekly, to get a clear picture of your income and expenses. This helps you anticipate shortfalls and plan accordingly, whether it’s adjusting your spending or ramping up your sales efforts. 2) Implement Invoicing Best Practices: Don’t let your cash flow get tied up in unpaid invoices. Set clear payment terms, send invoices promptly, and follow up regularly. Consider offering small discounts for early payments to incentivize your clients to pay sooner rather than later. 3) Build a Cash Reserve: Aim to have at least three to six months’ worth of operating expenses saved in a separate account. This reserve acts as a safety net, giving you breathing room to cover payroll and other critical expenses during slower months or in the face of unexpected challenges. 4) Monitor Expenses Closely: As your business grows, so will your expenses. Keep a close watch on where your money is going and look for areas to cut costs without compromising quality. Regularly review your subscriptions, renegotiate contracts, and eliminate unnecessary spending to keep your cash flow healthy. Think beyond just making ends meet. Build a strong foundation that allows your business to grow without hitting financial roadblocks. Making money is just the start. Real success lies in how well you manage it.

Cash crunches kill 82% of startups. I've seen it happen time and time again. But it doesn't have to be this way. As a fractional CFO, I've helped dozens of high-growth companies scale without running out of cash. The secret? Forecasting. Here's how to do it right: 1. Start with your sales pipeline 2. Factor in seasonality and market trends 3. Build multiple scenarios (best, worst, likely) 4. Update weekly, not monthly 5. Use rolling 52-week cash flow projections 6. Automate data collection where possible 7. Always have a 6-month runway Remember: Revenue is vanity, profit is sanity, but cash is king. What's your biggest forecasting challenge? #StartupGrowth #CashFlowManagement #FractionalCFO #StartupFinance #Growth #CFOInsights #CFOServices #Strategy #SMBgrowth #StrategicFinance #SmallBusinessSupport #StartupFinance #SMBfinance #ScalingUp