Finance’s (perhaps) surprising storytelling role
A Lot has been written on start-up growth. “S” curves have their share of column inches, funnel health too. I have nothing to add to those ideas, but I do believe we can do more to pull them together. As finance professionals, we should be leveraging them to craft and tell very important stories.
Like all good stories, the story we can write has a hero (the start-up), the challenge (growth) and the journey (trying to deliver the business plan). In this particular story, I believe Finance can be the author and narrator, pulling the strands together to ensure our hero has its day.
Your company wants to grow. It probably is already growing and it wants to at least maintain that growth, if not accelerate it. None of us wants stalling growth, right? So now the leadership team head off and do the hard work of building an actual plan to deliver it.
The step all finance professionals know comes next is the building of a budget. We turn the business plan into a numerical framework. Something that represents the plan— something we can measure ourselves against
Too often this is where our role would end. What we've written is a scorecard and we're ready to measure the business against it.
But where's the story in that? What we've missed is crucial to a good story...describing the journey.
With the business plan in one hand, and our glorious Excel in the other, now is when we get to work.
Now we imagine the future. What foes will we meet on our way? In what form will they come? When will we see them? Exercising our imagination in this way is vitally important work (and also lot of fun).
Let's imagine a scenario: A well-funded startup has hit $2m in ARR and has a solid plan to get to $10m. This growth plan is a “more of the same” plan. After all, why change what works.
So why does Finance need to do anything beyond building the budget?
Because this is exactly when Finance can add the most value.
If the essential work of turning the business plan into a financial framework has been done well, you already know what the critical levers and blockers of growth are. Maybe the levers of growth are things like:
hiring more salespeople
increasing PPC leads
opening a new market
maybe an expected new piece of product innovation?
But there are blockers to growth too:
PPC costs and the sensitivity LTV:CAC has with that - do the unit economics hold up?
What about the absolute size of the market, and what our growth plans mean in terms of market share - is there even enough market out there?
What about access to talented salespeople - do we need to open up in a new geography to find more?
And, of course, do we have enough cash in the bank to fund it all?
There are many levers of growth and many blockers too. Starting to write this story will mean you'll have some, but not all, of the narrative.
Now is the time to pull people together. Use the plan, the financials and your initial insight to preempt which demons you'll meet first on the journey. Test this with the leadership team. Work with them to complete the story. Align on the narrative, what the challenges are, and how you’ll adapt the plan to ensure the fairytale ending.
When you think of great storytellers, finance people might not always be the first to come to mind. However, it’s our responsibility and our purpose to write great stories.
Perhaps unlike your favourite book, your story (business planning) will be agile by nature. It's an essential way to navigate an uncertain world—and business is far from certain.
Bring together your technical skills, your insight—and most importantly— your storytelling ability to help ensure your story makes it to at least chapter 2.