How much cash does growth need?
Selling more products can mean paying for a larger stock order well before the money comes back. I want to understand that cash requirement alongside margins and customer acquisition.
FEDJA POROBIC / BUILDING BUSINESSESONE TOPIC. SEVERAL PERSPECTIVES.
Building businesses.
A budget can look great. Someone still has to do the work.
Drawing a growth curve takes seconds. Then someone has to buy the stock, find the customers, do the work and make sure the cash lasts. That is where building a business gets interesting.
I write about capacity, capital and the people responsible for the next step. What happens when inventory ties up more cash? When one person appears in five different initiatives? And why hire someone better if you still intend to decide how everything gets done?
MY STARTING POINT
The questions I keep coming back to.
Who will actually do the work?
A plan has to fit into people’s working weeks. Read the budget, priorities and team capacity together. Do they add up?
Does responsibility come with decision rights?
If everything still needs the founder’s approval, responsibility has not really moved. Hiring and delegation also depend on what you are willing to let go of.
FEDJA’S JOURNAL / SELECTED
Read the perspectives.
Articles by Fedja Porobic.
Your budget assumes someone can clone themselves.
If the plan needs two of the same person, it is a wish with a salary line attached.
READ ARTICLE
Inventory eats your cash. ROAS cheers it on.
Sales double and the ad account looks like a victory parade. Then the supplier’s invoice arrives.
READ ARTICLE
I want someone who can do the maths and still come up with a wild idea.
I want to discuss margin in the morning and a fairly unreasonable ad idea after lunch with the same person. That should not be an exotic combination.
READ ARTICLE
You wanted someone better. Let them be better.
It is easy to want to hire someone better than yourself. It gets much more interesting when that person starts doing things differently.
READ ARTICLEPOROBIC GROUP / GROWTH SERVICES
How we work on it.
These are the decisions we work on when we run marketing and ecommerce.
01 / DIRECTION
P&L, forecasting & strategy
We work out what growth can cost and when you need the money back. That guides the budget and what we do first.
EXPLORE THE SERVICE03 / EXECUTIONMarketing & ecommerce
We run acquisition, conversion and retention. We track how customers find the store, what gets them to buy and why they come back.
EXPLORE THE SERVICEAlso looking for an investor who takes operating responsibility?
Investment and operating partnership