A $2M Tech Startup Finally Got Control of Its Finances
They were bringing in $2M a year but had no idea where it was going. We fixed that without them hiring a full-time CFO.
Table of Contents
Table of Contents
The Situation
Growing Fast With No Financial System to Support It
The startup was doing $2M a year and the revenue was trending up. From the outside, things looked like they were working. But the financial side of the business was reactive, disorganized, and not built for the stage they were entering.
Key Situation Factors
The Challenge
Scaling Without a Financial System to Rely On
Revenue was climbing but the financial foundation wasn’t keeping up. Every major decision, whether it was hiring, spending, or expanding, was being made without the numbers to back it up. The problem wasn’t the growth. It was that nobody had a clear picture of where the cash was going or what was coming next.
Key Risk Factors
- Cash flow strained by late payments and poor collections
- Capital being spent with no ROI evaluation
- No forecasting model or budget in place
- Zero visibility into future cash positions
- Growth decisions made without any financial modeling
- No scenario planning for downside or upside conditions
Our Approach
Treated the Root Cause & Built the Infrastructure Around it
We came in and built the financial infrastructure this business was missing, then used it to get control of cash, spending, and planning all at once.
1
Step 1
Set Up the Board Cadence
Locked meeting dates upfront, set a pre-read process one week before every meeting, and defined who owned what across the CEO, CFO, and board chair. Meetings had agendas, minutes, and action-item tracking so nothing fell through the cracks between sessions.
2
Step 2
Put Structure Around the Close and KPIs
Set a weekly leadership meeting rhythm, defined the month-end close window with a hard target of the 15th and no later than the 21st, and built KPI dashboards with named owners across sales, marketing, and finance.
3
Step 3
Built the 13-Week Cash Flow Model
Modeled weekly inflow targets against operating outflows of roughly $197K per week excluding rent and $250K including rent. Rent scenarios, funding needs, and runway were visible in one place and updated on a consistent basis.
4
Step 4
Tied Everything to a Budget and Growth Plan
Pressure-tested unit-level labor costs, revenue targets, and cash break-even assumptions at the location level. Set the FY2026 budget deadline at January 31 with year-end financials due February 15 and assigned clear ownership across the leadership team.
1
Step 1
Built a Forecasting and Budgeting System
We built a rolling 12-month financial forecast tied to the company’s actual growth targets. For the first time, leadership could see where the business was heading financially, not just where it had been.
2
Step 2
Fixed the Collections Process
Receivables were going out and sitting there. We tightened up the collections workflow, improved payment tracking, and got money moving faster. Days Sales Outstanding dropped by around 20%.
3
Step 3
Put a Framework Around Spending Decisions
Every major expense was run through an ROI evaluation. We identified what was actually generating returns and what wasn’t, then reallocated around $300K toward the initiatives that made more sense.
4
Step 4
Gave Leadership Real Financial Visibility
We set up clear financial dashboards and reporting so leadership always knew their cash position, their runway, and what different scenarios looked like going forward.
The Turning Point
When Finance Stopped Being a Problem and Became a Tool
A few months in, the numbers started moving in the right direction. Leadership could see their cash position 12 months out for the first time. Collections were running smoother, spending had a framework behind it, and the forecast was something they could actually trust and act on. Finance stopped being the thing slowing them down and started being the thing driving them forward.
The Results
What Happened When the Finances Got Fixed
1
%
Demo Heading
Of customers recently chose a financial product from a provider other than their main bank.
1
B
Demo Heading
Of revenues at risk between now and 2025 if card-issuing banks are slow to invest in next-gen payment options.
1
%
Demo Heading
The share of US banks’ working hours which could be impacted by technologies like generative AI.
Qualitative Results
When the Finances Work, Everything Else Follows
The cash flow improved fast. But the bigger change was how the business started operating day to day. With a proper financial system in place, decisions that used to feel like guesswork became straightforward calls backed by actual data.
Key outcomes
- Leadership always knew where the business stood financially
- Stakeholders and investors could trust the numbers they were seeing
- Spending decisions were thought through before being made
- The founder had more time to focus on growth instead of financial problems
- Every plan to expand was backed by a financial model
- The financial setup was built to grow alongside the business long term
Testimonial.
"I needed a solution that was
cost effective but high quality and high caliber. So that's where Frack comes into mind.. They take care of what your needs are and they tailor it exactly to what your business requires. You're not just hiring Frack, you're hiring an entire team of experts and you're not just getting this one individual on your team, you're getting our entire network."
Key Takeaways
Key Takeaways
Revenue Without a System
At $2M in revenue, the real risk was making big decisions with no financial visibility.
Slow Collections, Tight Cash
The money was being earned. It just wasn't landing on time. DSO dropped 20% by fixing that.
Finance Became a Growth Tool
$300K was already in the business. It just needed a proper framework to go where it mattered.
Smarter Spend, Not More Revenue
Smarter Spend, Not More Revenue $300K was already in the business. It just needed a proper framework to go where it mattered.
Client Profile
Industry
Technology (SaaS / Software Startup)
Company Size
~$2M Annual Revenue
Timeline
Not specified
Stage
Scaling
Engagement Type
Fractional CFO
Capital Allocation
Cash Flow Optimization
Financial Forecasting
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The cash flow improved fast. But the bigger change was how the business started operating day to day.
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