To evaluate the performance of a growing startup, embrace spend-cycling.
If every month is increased in spend, you don’t get a chance to evaluate potential profitability.
So insert steady or scale-back months to see how much you can put in the bank.
You win:
- Confidence in a baseline you can default back to if you need to pause and regroup.
- Proof that you can actually bank any results. Doesn’t matter if you’re looking for a lifestyle business or an exit, demonstrating profitability is important.
- A second to breathe.
You lose:
- Quite possibly some speed.
Decide if you can make the trade.