“The only unforgivable sin in business is to run out of cash” [so said Harold Geneen], yet startup CEOs “always act on leading indicators of good news, and lagging indicators of bad news” [according to Andy Grove]; after all, it requires a certain stubborn, headstrong optimism to start a company. So how to reconcile these views? At the very least, pay more attention to leading indicators of running out of cash, “because there’s just no going back”!
But doing all this — while also trying to balance growth, advance planning vs. constantly changing strategy, revenue vs. margin, coordination/communication/culture, and so on — is a lot harder than it seems on a finance spreadsheet. It requires understanding that the “math is not the terrain, the spreadsheet is not the business”… yet also knowing when to trade rose-colored glasses for darker rainy-day ones.
And that’s where a CEO partnering productively with a CFO comes in. In this episode of the a16z Podcast — moderated by (and based on an internal event for CEOs+CFOs hosted by) Caroline Moon, who leads the financial operations for startups practice on a16z’s corp dev team — Ben Horowitz and Scott Kupor share their personal insights as well as advice for founders: How DO you do it all?
The a16z Podcast discusses the most important ideas within technology with the people building it. Each episode aims to put listeners ahead of the curve, covering topics like AI, energy, genomics, space, and more.