Cash flow 101: How to keep your startup alive (and breathing)

Learning goal

Startups don’t usually die from a lack of ideas; they die because they run out of cash.
You don’t need to be an accountant to stay in control. You just need to know:

• Where your money comes from

• Where it goes

• How long it will last

Good cash habits mean more freedom, less stress, and smarter growth.

Why it matters

1. What is cash flow?
   Cash flow equals money in minus money out.
   It’s about liquidity, not profit.

You can be “profitable on paper” and still fail if you can’t pay rent or staff.

Types of cash flow:

• Positive – more coming in than going out

• Negative – more going out than coming in (common early, but dangerous if it lasts)

2. Know your burn rate
   Burn rate is how much money you spend per month.

Example:
You spend ₱50,000/month and have ₱300,000 in the bank → you have six months of runway.

Knowing this helps you plan, adjust, or fundraise in time.

3. Track everything, even small stuff
   No fancy tools needed. Google Sheets works.
   Track:

• Income / sales

• Monthly expenses (tools, freelancers, rent)

• One‑offs (branding, prototypes, launch events)

This helps you spot leaks early.

4. Make money sooner, not later
   Don’t wait to charge. Even ₱500 from a pilot equals runway and validation.

Ways to earn early:

• Paid pilots

• Pre‑orders

• Service versions of your product

Cash buys you time—and confidence.

5. Plan for income ups and downs
   Cash flow is rarely steady early on.
   Build a small buffer. Expect surprises.

If your income is seasonal (like school or holidays), plan around it.

Quick checklist

• You know how much cash you have—and how long it will last

• You’re tracking income and expenses monthly

• You know your burn rate and runway

• You’re earning, even in small ways

• You’re making decisions based on real numbers

What to do next / StellarPH tip

List your expected expenses for this month and how you’ll bring in money.
Even one small sale moves the needle.

Cash flow isn’t just finance, it’s your startup’s oxygen. Protect it.