Budgeting In A Large Company

Fred Wilson 

The budgeting process is really critical in a large company. It forces the company to make highly informed decisions about investments and resource allocation and it creates company wide discipline around hitting goals. I have never seen a company of 150 employees or more operate functionally without a strong budget process.

 



Filed Under:
Collection: Strategy & Starting Up
Category: Budgeting, Projecting & Burn Rate

Always Have 18 Months of Cash in the Bank

Chris Dixon

I was once told by an experienced entrepreneur (I can’t remember who) to always have at least 18 months of cash in the bank. The logic behind this is: 1) as a rule of thumb it takes 3 months to raise money, 2) building/marketing/selling technology always takes longer than you think.

 



Filed Under:
Collection: Strategy & Starting Up
Category: Budgeting, Projecting & Burn Rate

Scenarios

Fred Wilson 

Since projections are not budgets and are much more "big picture" exercises, it is important to use a scenario driven approach to them. I generally like three scenarios; best case, base case, and worst case. But you could do as many scenarios as you like. It's not the results that matter so much, it's the process and the learning that comes from the projections exercise.

 



Filed Under:
Collection: Strategy & Starting Up
Category: Budgeting, Projecting & Burn Rate