cash-flow

Cash-Flow Matters

Share the

Why Give a Damn:

If there is a single thing, a single activity and a single metric you should care about when building a business (or a sustainable open project – which you should run like a business anyway), it is cash-flow.


The author of this post, Pascal Finette, is Director, Office of the Chair at Mozilla. His focus is on expanding the scope of Mozilla into new constituencies and supporting Mozilla’s Chairperson with the ongoing work of modernizing Mozilla project governance structures, raising Mozilla’s visibility globally, and generally governing the Mozilla project.

Cash-flow is simple: Money in minus money out. If your cash-flow is positive your business lives, if your cash-flow is negative your business dies. Simple as that.

Cash-flow is simple: Money in minus
money out.  Tweet This Quote

Yet I am befuddled by the lack of understanding of this essential fact of business. I literally haven’t had a single discussion about the actions which lead a particular business to get to positive cash-flow, or even the notion of cash-flow, with any of the many start-ups I’ve met over the course of the last couple of years. It seems that Silicon Valley’s obsession with growth and the vague notion of “we’ll figure out the business model later” led to a culture of people building companies with the single goal of selling them. And as Silicon Valley culture spreads throughout the world these days, founders all around the globe follow suit.

I cannot stress enough how important it is to get to positive cash-flow as soon as possible. Unless you’re the next Facebook/AirBnB/Name-your-preferred-hot-startup and swim in heaps of venture capital (which to be honest you most likely won’t be – the cards are clearly stacked against you… just look at the stats), having positive cash-flow means you are master of your own destiny. Cash-flow puts you into the driver seat. It allows you to do the things you want to do. And even if you want to raise money to accelerate your growth it puts you into a position of power, not one where you need to beg for money.

I literally haven’t had a single discussion about the actions which lead a business to positive cash-flow.  Tweet This Quote

So – unless you want to build your business as an acquisition target (nothing wrong with that – just know that the odds are heavily stacked against you), read up on cash-flow, understand the principles by heart, and make it one of your key objectives!

P.S. Here’s some recommended reading for you – Don’t Build A Company To Sell, Build It To Last by Kanyi Maqubela and anything you can find by Norm Brodsky (a columnist at Inc Magazine), e.g. this piece on cash-flow.

An Unreasonable Challenge:

Go do your homework and figure out what your current cash-flow situation looks like and how you can get to a cash-flow positive state. The life of your company depends on it. So, don’t put it off.


Update: Today I would add a paragraph which explains the situations in which you will forgo a focus on cash-flow for accelerated growth. When you have money in the bank (be it through an investment, loan or simply because you managed your cash-flow in the past) and the time is opportune for you to grow faster you can make a deliberate choice for growth over maintaining positive cash-flow.


This article is being re-featured today as a special “Throwback Thursday” post. We loved it so much, we wanted to make sure all of our new readers had a chance to read this article, (and share in the conversation).

Pascal Finette

About the author

Pascal Finette, jumps back and forth between startups (he's now on his fourth startup), Internet powerhouses (he worked for eBay, Mozilla and Google.org) and Venture Capital (he founded both a...

Pascal Finette has written 22 articles for UNREASONABLE.is

  • Jansscor16

    After I finish college, I am not sure exactly what I want to do. I have thought of maybe someday starting my own business. I have never thought of building a business just to sell it. I enjoyed your article, based on the simplicity of it. Can some businesses recover from negative cash flow? If so how?

  • sarahbrooks

    Thank you for writing this article. It
    is very true in the fact that this is what reality is like, and I can
    relate to it pretty well myself. From being in college I got a
    glimpse of the real world, instead of living at home and depending on
    my parents always, I now know that managing money is a key factor in
    life, and very very important. Growing up my family has also owned a
    business for over 20 years and I cannot stress enough how important
    it is to have positive cash flow! I could not agree more with you,
    because once that starts going downhill things get rocky and
    extremely stressful. Have you ever owned a business? If so, did your
    cash flow start and stay positive?

  • Luke Drumel

    Pascal could’nt of said it any better, the reality of the matter is money makes the world go round and its very useful and helpful to get a positive cash flow as soon as possible so that you are the one in the drivers seat. I compeletey agree with what you said “Don’t build a company to sell, build it to last” and that couldn’t be more true money will ultimately decided whether or not you’ll be successful.

  • Pingback: http unreasonable is opinion why cash matters more… | Kathys LinkBook()

  • Haley Horn

    Thank you for sharing. This actually reminds me of a show called “Bar Rescue” and “Restaurant Impossible”. I have watched plenty of episodes of each, and the main problem why the bars/restaurants are failing is because they’re spending/losing more money than they are making. To me, it isn’t rocket science. But I guess there are a lot more factors that play into that. I now see that it is important to start strong and make a plan vs. “going with it”.

  • jbrycewilson

    Ah, deja vu back to entrepreneurial accounting. I think the biggest challenge with startups is a lot of investor metrics are based off of accrual methodology, whether or not there is a requirement to report GAAP numbers to anyone. As an entrepreneur you have to both understand and follow accrual and cash-based methods, since ultimately cash is king.

  • natebbeard

    I know the focus of your post, Pascal, isn’t on this specifically, but I feel like the biggest hurdle for social entrepreneurs can be getting caught up in the social aspect more than the making money part. Similar to a founder getting to wound up in the product or technology in a tech startup and losing site of revenues. Finding a profitable business model that helps people in the world is one of the hardest challenges an entrepreneur could face. It’s probably a little easier to make money starting an affiliate marketing or apparel company with one focus than it is to try and raise people out of poverty with sustainable business revenues.
    If anyone has examples, like Jana, I would to hear from you (shameless plug: I’m doing a school project identifying and researching these products through case studies like Jana).

  • Jcoppa

    This article needs to be sent to the people in charge on government spending. In my government class, I learned that budgeting for the nation happens at the end of the year, after the money has been spent! That is so backwards! Then they will try to rearrange how they will spend it the next year. That system doesn’t work, hence the national debt.

    My question is how can a person dealing with finances stay in the positive cash-flow category when emergencies arise that weren’t accounted for, which may be the case for government spending.

  • Tyler Steinmetz

    Thank you for sharing your knowledge about cash flow and how important it is to have a positive cash flow. It is such a simple proposition/concept yet, so many people don’t understand that their business won’t last unless a positive cash flow is in place and working. Someone that is starting a company should look to grow and expand their company as much as possible, then when an opportunity for a buy out comes that outweighs your cash flow production, take that next step! When should a start up decide to sell their company or throw in the towel? Besides a negative cash flow, what is another reason to stop running a business or start up?

  • Amanda Laatsch ?

    This seems like a pretty simple concept to me. If you want your business to flourish you need some sort of money coming in. You can’t spend all of this money trying to make a business grow and not get anything to replace it. Sooner or later you are going to run out of your funds and you are going to go bankrupt. I don’t understand how people can be so confused about this? What is a good way to get it to stick in people’s heads?

  • Alessandro Paredes

    I completely agree with this article. I cannot understand how this is not a greater priority for many organizations around the world. I beleive that all non-profits, NGOs and charity based organizations (and any type of company for that matter) that has a main objective to help people, needs to shift to positive cash-flow goals. If I owned a company with the goal to reduce malnutrition and I relied on donations to continue my work, I would have to spend the majority of my time trying to convience people to give me money. This is a waste of time. If companies are designed to be profitable, the good work can be expanded exponetially. Profits are not a bad thing. The key for a business is to use those profits in a responsible manner. Profits do not need to change the goals of a company, they can only enhance the scope/scale of a busniesses impact.

  • Brandon

    Thanks for the article!! Cash-flow is very important to know how much money you have and know whats your budget. Especially if you want your business to be successful. i agree you got to understand what it takes to start up your own business not always easy to get cash-flow right away.

  • cameruca4

    I think it is extremely hard when you are trying to build a business to focus on cash flow, even though you are aware that it is the topic that should receive most of your attention. That said as you grow your business and you move from being a start up to a small business, I think it becomes easier to focus what money is coming in and how it is being spent. Until the point where you feel your business is viable though so much focus is placed on raising capital and spreading your idea.

  • Drew

    I agree with your point here Tyler! I agree that businesses need to grow and expand, the trouble i have here is that i think that companies should establish some trust and relationships before hand. I think to many businesses jump into something a little to fast before weighing options don’t you agree. To many times I’ve seen a company take a gamble on a decision that has come up and bit them in the butt.

  • Drew

    Great point Sara, coming out of high school did you feel you were prepared for college and the responsibility or money management? To many times we see students in their first or second year “splurge” in a sense with no adult super vision. So often we think of well its a loan ill pay it back later. When the mentality should be i need to focus on maintaining a job as well as budgeting our cash! Did you struggle with money your freshman year or were you better since your parents do own a business?

  • Shawn

    I couldn’t agree more, Alessandro. You have a very thoughtful response, and I agree that this lesson can be applied to both the for-profit and nonprofit worlds. Organizations that must rely on funds aside from the revenues they generate are at the mercy of the world, rather than an actor in it. While I’m, at heart, a nonprofit-oriented person, I am dropping the idea that this means I do not need to develop my organization as an engine that relies on a self-generated, positive cash flow.

    By chance– have you ever heard of the L3C for-profit status? It’s new, and not entirely established in most states in the US. It’s been termed “the for-profit with a nonprofit soul”. It’s a for profit entity that puts its mission over profits, and thus can potentially access some tax and funding benefits. I see it as a way to use a cash-generating entity to do the good work that the nonprofit world simply can’t reach.

  • Jeff Margolf

    Great post Alessandro, I definitely agree. It is hard to believe that more businesses, NGOs, and non-profits do not focus more on positive cash flows. On the surface I think it is a very simple concept, however, it can be an extremely difficult feat to accomplish, especially if the organization doesn’t have this mindset from the start. I can only imagine what type of world we would live in if our own government attempted to have positive cash flows more often. I believe governments should have positive cash flows as well and the use profits responsibly. We certainly wouldn’t be in the position we are in now, constantly enacting budget cuts or attempting to recover from extensively long and costly wars.

  • Caleb Trantow

    I think this article brings up some really good points. If you want your business to be sustainable and last, then focusing in on cash flow is an absolute must. Sure you might want to grow grow grow, but if a positive cash flow is not happening from the begging, then the whole business could soon come crashing down due to unmanageable debt. If you put cash flow first, your business may not grow as quickly initially, but a strong foundation will be made and your business will last longer and be stronger in the long run.

  • BartuchGR11

    Thank you for posting this blog. I found this blog to be helpful because it had some very important tips to remember when running a business. For example, making sure that your business had enough money coming in each month to be able to last. You also have to keep track of how much money you have and how much profit you are earning because that is also really important when owning a business. I do agree that you have to have cash flow first than start your business because otherwise without the money the business will get going and will die before it even starts. You start the business of as a mom and pop shop and then slowly over time work towards a small business and keep growing as time goes on.

  • justin bowers

    Although I have no desire to run a business, I still find this article very helpful. It can be applied to almost all aspects of life, not just for work. It’s always important to have more money than not so that you’re able to do the things that you want and even do them comfortably. Whether you’re running a business or just managing your day to day finances, it’s never a bad idea to end with more money than not. How much or how long should you save until you decide to progress with your start up?

  • justin bowers

    I definitely agree with the notion that you should start off as a mom and pop shop and then slowly over time work towards a small business until you’re able to reach the level where cash-flow will be almost imminent. Are you interested in starting your own business or do you find this helpful in other aspects of your life?

  • Daniel John

    I have no interest in starting up my own business. I have worked for many businesses and I have gained an understanding of the importance of cash flow. There are so many behind the scene expenses that goes into running a business. After reading this article I wrote down my cash flow and I was baffled by my results. Like a business I have to find things to change to increase my cash flow. I understand you recommended not to start up a business but if I was interested what type of business would you suggest? Thank you for the article and the book recommendations.

  • Evan Hibbs

    Great points Sarah and Drew. I can say my freshman year I had a job, which almost hurt me in ways because I was making plenty of money, but I was spending plenty of money as well. I certainly didn’t handle my cash as wisely as I should’ve. I believe this article is important because we are college students and are still learning how to handle money better. It can take a while to learn need vs. want and how to have some self control with money.

  • WolfgramKA06

    I agree with this statement,
    Amanda. It’s definitely something people should obviously be aware of when
    starting a business. They are going to need a good amount of money for startup
    costs, and it’s dangerous if the business fails because then they lose almost if
    not all of the startup cost. I think there should be more classes or lessons
    related to started own businesses because it is not meant for everyone.

  • Kyle Schiedemeyer

    I agree completely with your comment. Sometimes you need to spend money to make money, and that will almost always be the case when you are starting up your own business. Cash flow will come if you put in the work and the time.

  • Ryan Dewane

    Since I have interest in starting my own business this is extremely relevant. Especially with social businesses i feel the owners sometimes overlook cash flow because they are so focused on the social impact their business is making. In reality in order to continue solving this social problem they need their business to be fully sustainable otherwise they could cause more externalities than they began with

  • Kait Harman

    Although this is aimed for people who are interested in staring there own business, who doesn’t love cash flow? Even if you are not starting up your own business this is relevant to people because we all know someone who is interested in their own personal business start up. This is just one piece of advice ” get positive cash flow NOW.” Do not figure out cash flow after the business failed. Is it just this generation or have business owners always thought they would start a company just to sell it?

  • kolinjk29

    This article is very true. I have no intent on starting my own business in the future, but to stay successful you have to establish a consistent income. This article relates to many other aspects in life. For example when your starting your own business up it can be difficult to always have a consistent cash flow because you may need to always be spending to start it up to make it an invest that will continue to grow rather than decline. Thanks for the great article.

  • Ryan R

    Thank you for sharing this article. I’m not going to sit here and label myself an expert in the business area, nor to I plan on starting my own business anytime soon, but more attention being paid to this concept would most likely save many companies. Have you ever made the mistake of drowning a start-up in an insurmountable debt?

  • Brittney Glende

    Hello Pascal, what a great article! Money in minus money out is considered cash flow. Getting a positive cash flow is so important to start as soon as you can. Because you are so right that we will not be the next start ups of anything majorly big like Facebook, pinteret etc… So that is why it is so imperative to start young and earn money this will allow you to do the things that you want to do!! This was a great article to read thank you for writing this. When did you start thinking like an entrepeneur ?

  • aulm92

    Thank you for sharing this article. I feel as though its fairly obvious that you need a positive cash flow for your business to grow and to get one as soon as possible with a new start up. The sooner you start making money the sooner you can start doing things you want for your business.

  • laurenkraft

    I know I love cash flow! But I am not interested in starting up my own business.. I definitely agree with you though, everyone knows someone who wants to start up their own personal business. Sometimes it doesn’t end up working out sometimes it does. I find it interesting that you ask if business owners always thought they would start a company just to sell it because I one time had this business owner come into one of my classes to talk to us and they were telling us that they got the business just to sell it and said that everyone does that, but since his business has been so successful he hasn’t sold it yet but I believe that is something he will do in the way future. Kind of weird if you think about it!

  • pinsolera

    And going off of that, I agree with the fact it is so important to earn money now. I believe that sets the tone for the rest of your life making money because if you have a good work ethic, making money will become a little easier because you engrained that in your head as a younger person. And money has such huge leverage so if we can start making serious cash flow earlier on, it’ll open up doors for us as entrepreneurs.

  • John Darrow

    Great post! Thank you for sharing this short and sweet message. While reading this I couldn’t help but ponder the thought that you would eventually get to; Money in vs. Money out, it’s that simple. Initially it seems like one those things everyone understands at the beginning but as stated it is greatly overlooked in start ups these days. When that led to the Silicon Valley comparisons that was when this article did it for me. So true about people only looking to create and sell to become the next big thing. I agree whole heartedly with what is shared here.

  • schrammjm26

    It is as you said if your revenue outweigh your expenses your business is dying and visa versa. Money will always be the bottom line of any business, it cannot simply exist on the fuels of good intention. No matter how noble your purpose you need cash flow to support the functions of your business in order to realize those purposes. Your post is short but to the point, people first before anything else need to focus on the bottom line of their business, money.

  • Kobajr18

    Thank you for the post. Pretty short and sweet right to the point type of article. Its all about being in the green. Whether your a start up or a company that’s established it is still all about money. If you’re making money you stay in business and accomplish goals, if you’re losing money it’s the opposite. Simple. I like it.

  • Kobajr18

    My thoughts exactly. Seems like common sense to me that you should have a positive flow of cash early to grow. Sooner you make money is obviously beneficial to growth and success for your business.

  • Kobajr18

    I agree. I know absolutely nothing about running a business, nor will I pretend to have the slightest clue on how to go about doing so but the concept seems very logical to me. I also wonder why so many start up companies go into large debts fairly quickly?

  • Kobajr18

    The quote you used stood out to me more than any other throughout that post. Build your company to last not to sell. Money is the factor that determines how successful you are, theres no question about that. If you’re not making money what good is your company? Make money as soon as possible. It’s a simple solution.

  • Willie

    It seems like a very simple concept right, bring more money in then you spend and you’ll do just fine, but circumstances rarely allow you to that right out of the gate. That’s why you have to build a company that can sustain because if you aren’t careful, you can end up losing your business before you even get started.

  • http://parisinmadison.blogspot.com/ Amanda O.

    Money in vs. Money out: very well put. Initially it seems like one those things everyone understands at the beginning but as stated it is greatly overlooked in start ups these days. Revenues have to outweigh expenses in a business or else the business ends up dying. Thank you for sharing. It’s a precise read.

  • Kevin Weber

    Thank you for the post! The greater the cash flow, the bigger the business. You always have to stay ahead of the bottom line. Starting up a business can be tight in the cash flow area, but if you stick with it and believe in your vision, your cash flow can start to increase. This article can apply to every day life, not just businesses. Easy and simple concept to keep in mind. Thanks again!

  • KevinThomson32

    I completely agree with this article and thank you for it. In order to have a successful business you must have a positive cash flow early so you can establish yourself. So many people say that “oh it will come just be patient”, but then never see it. If you believe in what you are selling I believe you will be successful

  • katie bartlein

    I think that this article is very well written. The idea behind the blog is so simple that most people might just miss the point. Cash in minus cash out equals cash-flow. One of the simplest math equations possible. However, today, people tend to build a business so that a few years down the road they can sell it and make a profit from the business as a whole. In that equation they are missing the basic steps. In order to sell a business it has to be worth something in the beginning. How can a person be sure that in 10 years down the road their business will be worth the sell?

  • Ashley Nicole Rietbrock

    Thank you for sharing this article with us and I agree with what you are saying. For business to be successful they need to have a positive cash flow early and keep the positive cash flow coming. Some business don’t have a positive cash right away and think they just have to be patient it will come, but they never get a positive cash flow. I see these small business or restaurants and always wonder how they make it because there is never a lot of people in there and wonder if they have a positive cash flow coming in? Thank you again for sharing this article.

  • sarahbrooks

    I wouldnt necessarily say I struggled.
    I could be better and I could be a lot worse. (just dont take me
    shopping) But my freshman year, I was in the mind set of ,“Oh, its
    a loan I will pay it back later.” Actually, Im still in that mind
    set from time to time. It actually just occurred to me within the
    last fews days that I need to manage my money a lot better because I
    am going to La Crosse next year and I am going to have to dish out
    some more cash flow to that school. No more manicures and hair salons
    for this girl! Have you ever “struggled” with money? OR are you
    pretty good of knowing how much your allowed to spend and save?

  • sarahbrooks

    I agree with you. Working is where the struggle comes in because then I think it is okay to spend some of it. It’s very very important for people to learn from the things they need vs. want. Myself including. Its pretty obvious that I know I just “want” a lot of things. The sooner I realize not to waste money on my hair and nails the better! Do you ever spend money on things you know you shouldnt?

  • treehugger90

    I agree with you, if a person does not have a successful cash flow early on; their business would pretty much be nothing and would not be easy to establish. I like how you said people say, “oh it will come just be patient”, we all have to face it because money is the big picture in this economy nowadays.

  • Anthony Urbanski

    Very helpful for anyone who is thinking of bringing a start up. Cash flow is key, I may not have first had experience with this idea but when you think about it you being to understand the importance of positive cash flow. Did you experience any difficulty gaining a positive cash flow?

  • amykahl8

    this reminds me of people trying to lose weight. It’s a simple concept, calories in minus calories out should be a negative number. However people over complicate the concept and try to find ways around it. I think we just need to remind people to stick to the basics.

  • Frank_Stanek

    The only problem with trying to balance your money, expecially when starting out, is that when first starting out or when trying to expand it is sometimes necessary to spend more than you have. You have to spend money to make money is something that sometimes is more relevant than playing it safe and only thinking about keeping yourself out of the red.

  • Jessica Walker

    I think anyone who wants to start a business needs to become very familiar with this idea of positive cash flow. It will be detrimental to your entire company if you do not figure this out from the get-go. If you do thorough planning before you actually start anything up, plan out a budget, a revenue and over estimate expenses, that is a great start to get an idea if you will be in the clear or not. Personally, I would not want to start a business if I knew that I would be in negative numbers. I would want to have a stable ground beneath me, and be able to enjoy running the company rather than scrambling for pocket change to help get through each day. Sure, having high hopes for your company is great, but wouldn’t you rather be positive that thing will run smoothly?

  • Josh Pritchard

    Agreed! I do not plan to run a business either. Unless I somehow decide to open a gym or something like that. But still, it it always nice to have money and it is nice to be able to live comfortably. I would like to be able to use this article one day to my advantage. A lot of people like to get a business started and eventually sell for a lot of moeny. Cash flow. My cash flow is probably not good. Ways to improve?

  • Jessica Aschenbrenner

    I never knew cash flow wasn’t a concern for most, but now that I see the Silicon Valley way is to make a business so you can sell it later. This takes the idea of entrepreneurship out of the equation. Where is the fun in that? Cash flow is an interesting topic because most companies are more focused on establishing themselves as a sustainable or unique business rather than gloating about their profits. Seems there are two ends of the spectrum but it is interesting to know the Silicon Valley impression is so potent in the business environment.

  • Caitlin Donohue

    I really enjoyed this article, thank you! I feel like many people gamble on money they don’t have, especially when it comes to some businesses in my home town. My father gave me advice when I was younger and taught me to live within my means. I feel that can relate similarly to this article. Great advice, thanks again!

  • PKroening

    Thanks for sharing the article! The only problem I see is when you’re starting a business and you have to expand you usually have to take a hit and go into the red. Just like the old saying” You have to spend money to make money”, in order to make your business larger you have to spend tons of money. My only question would be, did you ever have any troubles with accumulating a solid positive cash flow?

  • PKroening

    Completely agree. When you are starting a business you know you should be thinking about money but it’s just so hard when you have all the other things on your mind.

  • PKroening

    This is a great way of looking at it. If you are concentrating on the money aspect your business wont strive as much as it could but you know that you are staying in the green area and you aren’t gaining a crazy amount of debt. Thanks for sharing this.

  • Jack Delabar

    I agree, Caitlin. A lot of people and businesses spend money that they don’t have thinking that whatever they’re spending it on will make them that money back and too many times, it doesn’t. Companies can crumble because of this. Your dad gave you some awesome advice…my dad gave me the same!

  • Jack Delabar

    I never knew that “cash flow” was a concept that some owners didn’t understand, but reading this makes me realize that it is. Far too many times I’ve seen people and businesses spend money that they don’t have in hopes of something taking off and making that money back for them. i.e. the stock market. Too many times, this doesn’t work out and they are left on their asses. As one of the girls below me said, “live within your means”. It may be hard and time consuming to make money, but its necessary to stay afloat.

  • Lindsay Burke

    It really fascinates me that people can start a business without having in mind the concept of cash flow. Cash flow is the basis of all business. If you dont have money then you dont have a company. I dont understand why people would choose to ignore this hugely obvious factor. I also can see one side of a business startup, where they spend lots of money in the start up hoping that it will pay off in the long run. This could also be a risky move, but most companies are started on the foundation of some sort of debt. It seems like a common idea to just spend what you want now and “try to figure it out along the way”. When you spend money with this idea in mind, you may end up in a perpetual cycle of spending and not earning enough to cover the expenses.

  • Tyler Grant Hartung

    Oh baby. The best part of financials is the ol’ CF statement. If you don’t know your past and expected future cash position for every month I have no idea what you are doing.

  • lex_alwaysMIA

    I totally agree, people have a tendency to live these lavish lifestyle that they know they cannot afford. For you to try and start a business with these unrealistic ideas and demands. You have to start small first before you expand to “Trump” status. Great article!

  • lepkowskjj29

    totally agree I feel the motto of “you have to spend money to make money” is what discourages people from starting a business or expanding a business.

  • Amy Rink

    I agree with you 100%, that it is important to have positive cash flow right away. It would be better for the company. You bring up a really good point when you talk about the smaller businesses! If they have a few bad days does that effect their positive cash flow a lot?

  • GraceFelion

    I can’t imagine starting a business without thinking about how funding is going to happen. That would definitely be a recipe for disaster. I wish money wasn’t so important but it truly is. Even as a theatre major I understand and respect that I need to find ways to make the arts profitable. Thank you for your post!

  • KJ

    My accounting teacher always says this and it is really cool to see an entrepreneur say the same thing. I have yet to start a business but it is good to see this idea reinforced because positive cash flow is so important. Thank you for sharing.

  • jkailing

    I like this article a lot I think that it is very simple
    concept yet people tend to forget it. I think that this applies to not only
    starting a business but life in general, knowing your cash flow and making sure
    its positive is very important to have in life. If you have a credit card and
    know you don’t have enough money but buy it anyway because it’s so easy to
    charge it on your credit card and walk out with that item. I also think that
    this its very easy for a start up company to spend a huge amount of money in
    the beginning and thinking it will pay off eventually over time but it doesn’t
    and they lose their business. One question I would ask the author is how long
    should a company wait before deciding to keep it or not?

  • kristinwagner32

    I completely agree with figuring out and planning ahead of time before jumping into starting a business. Every company should be striving for positive cash flow. However many start up businesses become great from starting in the negative numbers. Cash flow is hard to establish especially from starting ground up. I think if more companies realize and base their decisions off of that they may be in debt for a while will help them make further decisions and have set money aside in case of an emergency. Thanks!

  • Drew

    This is why i believe that in high school they should really pre-pare the students to manage time and money a lot better. Like you said the mindset for many college students is “oh its just a loan, i’ll pay it back later.” It’s not until they get out of school and are paying their loan a whole lot longer than they should be paying. Yes I did go through the money struggle but I’ve always had a job throughout school so I at least had a steady income coming in. But do you feel like if you do have an income you might tend to spend more since you know your getting paid anyways?! Really your transferring to La Cross???

  • Drew

    See its great to see that freshman do go out and get jobs, but all to many times that can also be a negative. When making money I’ve always felt that, “hey i can spend more, my paycheck is coming in soon.” Like i mentioned to Sarah I believe we don’t learn as much as we should coming out of high school. Financial classes and money budgeting should be required for seniors about to set off for college in the fall. But i do agree with you Evan! Thanks again

  • barczakdm08

    Yeah I wish money wasn’t so important too, but the sad truth is that money talks and with money you can basically do anything you please. Its the sad reality of the world we live in now.

  • Britnee_Kay

    This is something that I had to realize very recently when talking about how I wanted to be an architect with the humanitarian goal. That can always be what I want to do, but without making money myself, I’m not going to be able to get too far. This is a great article and is so simple, it’s a helpful read.

  • Ashley Nicole Rietbrock

    I wouldn’t think so because it all depends how busy they are the rest of the week. Lets say its really slow Tuesday and Wednesday but on the weekend there are always people in there. I think of it like that what do you think? Also, if it like on a regular bases I think it would be fine.

  • Andersonjc16

    I enjoyed this, made things very clear like many students i have the same obstacles tying to live a normal life and go to school full time while trying to afford a place to live and even trying to find money for others things to allow me to progress in life and everything comes back to money.

  • sarahbrooks

    If I was a making some good money, I
    would feel like I could spend it on a bunch of things I want! With
    the money I make now by working at school, it is not enough to just
    go out and waste; so with this income nooo I do not feel like I
    should go off and spend it. Do I? Yes. But I have gotten a lot better
    at managing my money compared to last year. Yes, I am really
    transferring. Or I might be super spontaneous and audition for a
    movie in LA and make some major bank. I mean, acting cant be that hard. I
    could be in a movie!! (fingers crossed) If you could do anything in
    the world, and money didnt matter at all; what would you be doing
    Drew?

  • Drew

    If money wasn’t a barrier in life, I’d find a loving wife/mother who wanted to have as many kids that i would like to have! If they were so darn expensive having 12 kids would be a dream come true since i love children. The problem is money, so I’ll have to settle for 2-4 kids haha! Profession wise i’d like to race snocross and motocross if i had the extra cash all year round which is stinks! Thats a bummer that your transferring though…

  • sarahbrooks

    Wow 12 children huh? Thats a handful. That sounds exciting and kind of dangerous. Since money is a factor, what is your major? Are you passionate about what you are going to pursue your life in, or are you only doing it for the income? Or both?? If money wasnt a factor in my life I think I would be in Australia doing some yoga on the beach.. Id like to teach a class or something. Or maybe I would just travel all around and learn the different cultures. Id probably be a hippie, then come back to the states and raise a family, and have little hippie babies hahaha.Just joking… But yeah it is kind of a bummer. Change is good though. At least that’s what I keep telling myself..

  • Drew

    Yeah i love kids and cant wait to be a dad when the time is right! My major is actually education ha go figure huh?! Cant get enough of kids! When the light bulb goes on in their head its one of the best feelings in the world! I’m very passionate and cannot wait for my career to take off! Obviously the money isn’t what it should be, but it’s the passion that keeps me going! Yoga class huh? Sounds like you are already well on your way in becoming a hippie!! Change is good! Where are you transferring and are you changing your major?

  • sarahbrooks

    La crosse! Ive change my major about 4 times already. I plan on changing it to Health Education. You know, gotta teach kids to be safe and healthy! Looks like I cant get enough of kids either. What grade are you looking to teach?? I’m thinking I wanna do high school.

  • sarahbrooks

    La crosse! Ive change my major about 4 times already. I plan on changing it to Health Education. You know, gotta teach kids to be safe and healthy! Looks like I cant get enough of kids either. What grade are you looking to teach?? I’m thinking I wanna do high school.

  • Tammy Hartmann

    When I read your article, it was a struggle because I wish it as not all about money. One person commented on your post that he wished money wasn’t important but the sad truth is that money talks and with money you can basically do anything you please. It’s the sad reality of the world we live in now. I have a question: is it possible for us to reverse the cash flow and have it go into community development?
    Thanks, Pascal, for the article.

  • Drew

    Oh really, is La crosse saving you money or closer to home? Health Advocates are great people in the world! We need more of them. Kids are great to be around reduce stress for some, they keep me smiling (so feeling happy), and overall just great opportunity to help out the youth or next generation! My degree is secondary education, so i could technically teach grades k-12. So I’m not 100% sure which grade ill end up teaching i just hope to score a job after graduation. Are you up for relocating upon graduation?

  • sarahbrooks

    Heck no it aint saving me money. Its costing me more. Its closer to my mom and farther away from my dad..so location really isnt to my benefits when it comes to seeing pops. Yeah I want to move to FL when I graduate. I actually want to move there now, almost packed my bags and was going to head down after this year but the cash flow would have stopped flowin’. You know, its probably just not a good idea financially. Plus I did not have such a great support system. Do you want to stay in good ol Wisconsin?

  • Caitlin Donohue

    Exactly! I can imagine, once you start getting a little money, it might be hard to maintain the lifestyle you’ve had and not blow it all on “trump status” things.

  • Caitlin Donohue

    Nice! Awesome that we were raised that way! Also great for this article to remind us to be smart about money.

  • Alyssa Borgrud

    I agree with your post, Tammy. Sadly, money has become the “golden ticket” for success. With money, you can buy anything, and usually get out of anything if you have enough to buy your way. I think that in the future, money will continue to get more and more powerful. I think that the only way that there would be a reverse of the “cash flow” would be if our world became a simpler time. We would need to go back to placing importance on family and experiences instead of money and items.

  • Amanda Laatsch ?

    I definitely agree it is not meant for everyone. I know it would be very difficult for me to start a business, espeically with the knowledge I have about it currently. Maybe if I was taught more about it I would be more confident in being able to start my own business. It has always kind of been a dream of mine to someday own/run some sort of sports facility.

  • lshortreed

    I also think that people are to consumed with money in this generation. What do you think?

  • lshortreed

    Good motto its a true statement though. I also think that people are afraid to spend money that they just earned. Every time you turn around you have to spend it on something else.

  • lshortreed

    What if people had two different accounts.. One for there important financials and then one for other “stuff”?

  • jkailing

    I agree with this. I think that a lot of people think that there business will just take off right away and be making enough money within the first few months to pay off the debt right away, and when it takes longer than they thought to start making money things go downhill. I think that company owners need to budget better and track there spendings so that there company won’t go under.

  • Drew

    Oh well thats nice that you have family nearby the location. All to often people go off to college and cant handle it. Hence the reason suicides are so high in college aged students. But seems like you are well on your way to getting out of the area and loving it! Being financially stable is very important when it comes to our everyday lives so we must never shy from work and keep on keeping on! What has been your favorite job and why was it your favorite job? Was it because of good pay or just the enjoyment of going to work?! Im really ok with relocating if need be but wouldn’t object to staying here also!

  • sarahbrooks

    Hmmm my favorite job would probably be life guarding just because I got to me outside all day and I love the sun and water! But when it comes to the money, definitely being a server is where it’s at. There’s some pros and cons to each job I would say. What about you? What are your experiences with your job choices?

  • Caitlin Donohue

    That’d be interesting. I wonder if that’d make you better at being good with money because you’d be strict in one account then have more freedom with another account. Being strict with money all the time can sometimes make people break at some point and the blow a lot of money.

  • Caitlin Donohue

    Also, another thought, that concept reminds me of the movie The Purge. Everyone in America has 24 hours to do whatever they want and it’s not considered illegal. Due to this 24 hour span of total freedom, people are better behaved all the other 364 days of the year and crime rates are lower. Kind of a similar concept with having a strict, important financial account and one for other stuff.

  • Angela Hoch

    Britnee, I also found this post to be interesting and a helpful read because making your cash flow is very important since it’s what will most likely fund your life. It would be so easy for a start up company to over spend at first because they probably think they’ll pay it off once their business takes off. The reality of the situation is, what if their business doesn’t take off? Money seems to be the key concept in life with getting to where you want to go.. it all takes money to get there.

  • Drew

    Yeah that is a major plus. Doing what we love always makes work easier. Ive always been one to seek out a profession that i wouldn’t struggle to get up each and every morning! I hope that i have found that with education! Really i would have never guess a server makes that much money. I figured people tipped bad a lot and thought nothing of it. Ive tried a lot of jobs out in my years as a laborer. Ive worked in factories, outside, at a retail store, a gym as you see, but my favorite was working as a camp counselor with all the children. Its a great feeling to make a difference everyday and brighten a childs mood!

  • sarahbrooks

    You sure had the options with work! I can see you succeeding as being a teacher, and it sounds great to work as a camp counselor! And about the serving, dont get me wrong there are people who dont even tip at all!

  • Katie Ackerman

    This article is very true. This article relates to many other aspects in life. For example when your starting your own business up it can be difficult to always have a consistent cash flow because you may need to always be spending to start it up to make it an invest that will continue to grow rather than decline. Thanks for the great article.

  • Drew

    Thanks for the words of encouragement! You said earlier that you wanted to become a health teacher didn’t you? What type of involvement would you get your students involved in like Ann does for us? Do you think that these are beneficial? What would you change or improve so that your students did get involved more?! Thats a rough life style with some waiters having that as their main source of income during college years!

  • Chris Williams

    I think it is extremely hard when you are trying to build a business to focus on cash flow, even though you are aware that it is the topic that should receive most of your attention. That said as you grow your business and you move from being a start up to a small business, I think it becomes easier to focus what money is coming in and how it is being spent. Until the point where you feel your business is viable though so much focus is placed on raising capital and spreading your idea.

  • Amy Rink

    Thank you for posting this article! I think everything that was said in this article is 100% true. We should all set some money aside and save. Having cash flow is important for all ages and should be started as soon as possible. When did you realize that this is something everyone should do?

  • Tim Rutkowski

    Thank you very much for the post. I find this article to be valuable to small business start ups looking for future advise for their problems with their cash flow. I think that if you are planning on starting a business or a big investment, you should definitely have some reserve cash in a rainy day fund to be able to get through the rough times.

  • Alivia Holman

    I agree with you. Money is the center of our problems as students. Its hard to work while in being enrolled in school and pay bills. I think money has become important to us because we are struggling to get through the month, I wish the value of money was not important when we are trying to get good grades its just another distraction.

  • Nathan

    Thank you for an interesting article! This is a great article for business people to read. It should probably be a fundamental piece that you should have positive cash flow, but I am sure people miss it. Does this same aspect of business apply to people? I am wondering if everyone should learn that in their own lives they should have a positive cash flow.

  • mayaennis

    I agree with both your sentiments, money should not be the main focus. I believe for some organizations money itself is not the main focus, it is just one resource for the company. The main focus is on the organization’s goals and mission but in order to accomplish these goals positive cash flow is a necessity. I agree with you Alyssa, in that importance should be placed on experience but I have to ask- isnt that already the case when allocating salary within an organization?

  • mankobj22

    This is absolutely fundamental to business success. It may seem elementary but I am willing to bet that it is frequently overlooked. For that reason, I appreciate your return to the basics and to the simple things that can set you up for success. You don’t always have to look far and wide or analyze and evaluate until your brain is numb. Sometimes its the basic skills that get you everything you need.

  • Skowronssj06

    I agree with you 100%! School is so expensive and on top of that we have to live there and buy food and books- it all adds up. While at school I look at my cash flow and it is currently going the wrong way. Everything is about money these days and it is an important part in everyone’s lives if we want to get through just a day.

  • Amanda Wood

    Although most of us dont want to admit it, money is our key to success. Without money a person lives a scattered life. Without money a business goes down in flames. Without money crime begins to emerge. Money is the center structure to everything, yet it is a ticking time bomb. We live our lives to find jobs or own businesses that are successful. Not successful in our hearts, but in our pockets or checkbooks. Is that true happiness? Why is it that we have to be dependent off green pieces of paper?

  • Cossioj14

    unfortunately, in my opinion, cash/money has become the most important thing in our lives. However, it is crucial to have positive cash flow, who knew? It really is as simple as you put it, positive cash flow equals positive results. Negative cash flow equals negative results meaning your business is dieing.

  • thomas kearney

    It is as you said if your revenue outweigh your expenses your business is dying and visa versa. Money will always be the bottom line of any business, it cannot simply exist on the fuels of good intention. No matter how noble your purpose you need cash flow to support the functions of your business in order to realize those purposes. Your post is short but to the point, people first before anything else need to focus on the bottom line of their business, money.

  • earose14

    Cash flow is for sure something everyone wants. We find jobs to make money and we start bussinesses to make even more money. Money is the key to mostly everything in this world and without it we would be lost. Money shouldnt buy us happiness. We focus so much on money because if we didnt have it nobody would be happy and we wouldnt be able to afford anything. So why is it that this world is revolved around cash flow? Thanks for sharing!

  • Caleb Franklin

    I think this is a really good article for those that are starting businesses. Too often you see start up businesses dig themselves in a very deep hole because they go way too long without positive cash flow. When your business is your brain child you want to believe that eventually you will make tons of money because after all, you wouldn’t start a business if you didn’t think it was a great idea would you?

  • Kaylee Raucci

    Thank you for the post! I agree with this cash flow topic. Obviously every start up business wants a positive cash flow. The trouble is making that happen. Too often starter businesses will invest until they cannot anymore and build up debt. They have gone way to far into this debt hole and unfortunately their product is not selling how they hoped it would and it is all just a recipe for disaster. Ending in negative cash flow and foreclosure, bankruptcy, etc. This is a good article to read to future starter businesses to read. It gives them lots of great ides on how to make positive cash flow and how important cash flow really is. Money makes the world go round, or so I’ve heard. I believe that if you set out on making tons of money, you can achieve that goal. First you have to be smart about your money and how you invest it. Then you can splurge one you are up and running, but for now play it safe and don’t set your goal too high.