QUESTIONS FOUNDERS ASK
Why is cash tight when my business is growing?
By Ivanka Menken, Strategic Mentor·Updated
Ivanka Menken traces it to a chain: prices are too low, so margins are thin; growth on a thin margin uses more cash than it brings in; payroll becomes a monthly fear; and confidence drains. The fix starts with what you charge, and it is measured in weeks of payroll covered by cash.
How can growth make cash worse?
Each new client needs people, time and often materials before the invoice is paid. If the margin on that work is thin, the cash it brings in arrives late and small. The faster you grow, the more cash the gap swallows.
What is the price, cash and confidence chain?
- Prices too low.
- Margins thin.
- Growth eats cash.
- Payroll becomes a monthly fear.
- Confidence drains, and a slowing market makes every link louder.
Which number shows the problem first?
Weeks of payroll covered by cash in the bank. It is the first number on Ivanka's monthly scorecard because it turns a vague worry into a figure you can watch. Looking 13 weeks ahead, week by week, shows which week will be tightest before you reach it.
Where should you start?
With what you charge. Compare the price of your newest piece of work with the same work a year ago, then test each growth move by what it does to margin, not only to revenue. Moves that only add revenue at a thin margin are often the first ones to stop.
Is this financial advice?
No. Ivanka reads the numbers with you and asks the questions that lead to a decision. Your accountant does the accounts and gives the financial advice.
How does Ivanka work on this?
This is the starting point of Cash-Tight Growth Mentoring, and three tools go deeper.
What else do founders ask about this?
Can a profitable business run out of cash?
Yes. Ivanka Menken sees it often in growing founder businesses: the work is profitable on paper, but wages, materials and time are paid out before clients pay in. The thinner the margin and the faster the growth, the wider that gap. Weeks of payroll covered by cash is the number that shows it early.
Should I raise my prices if cash is tight?
Ivanka Menken starts the conversation there, because price is where the chain begins. She asks founders to compare the price of their newest work with the same work a year ago and to test what a change would do to margin and to the clients they want. The decision is yours, and your accountant checks the numbers.
What is the 13-week cash view Ivanka Menken uses?
It is a simple forward look at cash, one row per week for the next thirteen weeks, filled in by the founder: opening cash, money expected in, money going out, payroll and closing cash. Ivanka Menken reads it with the founder each fortnight. It is not accounting or financial advice; it is a way to see trouble coming.
Is growing more slowly the answer to tight cash?
Sometimes, but not always. Ivanka Menken treats it as a decision with three paths: pause growth to fix the numbers, keep growing with support, or stay the course with a review date. Her Growth-vs-Financials Intensive settles which path fits in 90 minutes. If the pause is chosen, the founder writes down the numbers that end it.