Cash Flow Management for Startups

Cash flow management is critical for startup survival. Unlike profits, cash flow reflects real-time financial health—money coming in versus going out. Startups often face irregular income and high initial costs, making it essential to monitor expenses closely. Creating detailed forecasts, negotiating flexible payment terms with vendors, and maintaining a cash reserve can help prevent shortfalls. Tools like accounting software also aid in tracking and planning. Mismanaging cash flow can lead to missed opportunities or insolvency, even if a business appears profitable on paper.