As the new year approaches, many of us are reflecting on the past year and setting goals for the future. For a CFO of an early-stage startup, this is an especially important time to plan ahead and prepare for the coming year. With only 11 days left in 2023, what are some of the things a CFO can do to front-run the new year?
Final Review of The Budget
While the 12-month operating budget for next year should be finalized at this point, remember that it is a live document and it is more strategic than financial.
When the day-to-day hustling slows down, now it is time to think long and hard. What are things that might have been missed in prior reviews? Is there any significant change in business partnerships or the economic environment that requires immediate adjustments in the budget? Any major opportunities that have popped up in the last quarter/month that requires strategic reallocation of resources? After all, a well-managed budget is not just about numbers, it’s a crucial tool for achieving long-term success and growth.
Cash Flow Management
December and January are popular months when annual (subscription) bills are due. By setting aside some time to review your payment schedules and set aside sufficient cash coverage, you can start the year off on a positive note and avoid any potential financial headaches during the festive month.
Investor Communication
It is a good time to engage with your investors during the festive month as everyone is in a cheerful mood, especially if you plan to do a fundraise in H1 2024. Communicate clearly your achievements in the past year whether it is through an investor newsletter or an in-person meetup. Additionally, it is also a great time to showcase your business plans and strategies for the upcoming year. Whether it’s through hosting a holiday-themed networking event or sending out personalized greetings, taking advantage of this joyful time can help strengthen relationships and build excitement for any future investment opportunities. Trust us, it’ll be worth it come Q1 2024.
Compliance and Tax
Not everyone’s favorite topic, I know. Regardless, it is the basic building block of a successful business operation. Speak to your tax advisors to optimize the company’s tax position. For many startups in the technology sector, often times the R&D deductions or credits can make a meaningful difference to your financial situation. Also make sure everything is in good shape for upcoming regulatory reporting deadlines.
And that is a wrap! As the calendar turns its page to 2024, the actions you take in these final days of December will serve as the launchpad for your startup’s journey into the new year. By meticulously reviewing budgets, optimizing cash flow, and fostering transparent communication with investors, you are not merely preparing for the year ahead; you are setting the stage for success.