How much should your startup spend?

We’ve created a spreadsheet to help you work out how much your startup should spend each month to get the most out of your capital. Download it now.

Things are looking pretty good for your startup. You’re half way through your first round of funding and you’re well on your way to being profitable. The problem is knowing if your current growth is enough to get there on limited runway. If you’re spending too much each month, you’ll run out of money before you’ll be able to support yourself on your revenue alone. On the other hand, you may be growing at a rate where you’ll easily become profitable without dipping too far into your capital.

If you’re in this situation, you can choose to spend a little more. Increasing your advertising budget or bringing on more talent allows you to take advantage of any growth you may have left on the table. At BugHerd, we needed a way to optimize the amount we were spending each month, so we could maximize our spending on without our cash dipping too far into the red. The result was this spreadsheet.

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All you need is a few months of revenue and burn data, and the amount of money you have now. If this sounds useful to you, go ahead and download it.

About Tom - Tom Pisel hangs out with lots of different numbers at Macropod. If you're very quiet and don't startle them, they might just say something interesting. He's worked with several Melbourne startups and founded TRAMSURANCE, which might have been a big deal if it wasn't illegal.

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