I was talking with a founder just last week—a guy who's been selling like crazy, doing absolutely fantastic. Revenue was up, deals were closing, everything looked perfect on paper.
But here's what happened: He outsold his cash.
That's the brutal reality of cash flow management that most founders never see coming. You can be wildly successful and still find yourself in serious trouble if you don't understand the difference between revenue and cash flow.
When I work with Ready Founders™, cash flow management is often the first conversation we have. You can have the best product, the smartest team, and the biggest opportunities in front of you. But if you can't manage cash flow, none of it matters.
When the Department of Government Efficiency (DOGE) changes hit, I had clients who were doing great—until they weren't. Government contractors who were thriving suddenly found themselves needing daily cash flow reviews instead of monthly ones.
The faster a company is growing or the faster it's decelerating, the more often you need to manage your cash flow. And you need to have that system in place before you need it.
I've watched founders put themselves out of business because they didn't manage their cash flow properly. By the time they come to us saying "help," they're usually already trapped in expensive short-term loans and desperate for any capital they can get. At that point, it's much harder to secure the right type of financing on good terms.
Most founders manage cash flow by looking at their bank balance. This is like trying to drive by looking in the rearview mirror.
Your bank balance tells you what happened last week. What you need is cash flow forecasting that tells you what's going to happen next month, next quarter, and beyond.
Companies going through fast growth or fast deceleration need to dial up their cash flow management immediately. What worked when you needed monthly reviews suddenly becomes a daily conversation when you hit rapid change.
Here's something that surprises a lot of founders: QuickBooks Online—the tool most businesses rely on for their financials—falls short when you need serious cash flow management.
Don't get me wrong, QuickBooks handles bookkeeping fine. But when it comes to cash flow forecasting and analysis, it can only give you monthly snapshots at best. When you're dealing with rapid growth or sudden market changes, monthly isn't nearly enough.
When we do detailed cash flow management for clients, we must layer in additional tools. We use Fathom for better monthly cash flow insights than QuickBooks can provide. For clients who need weekly or daily visibility, we turn to specialized tools like Cash Flow Tool, Cash Flow Frog, Float, and Mosaic Tech.
But here's what I've learned: The tools are only part of the equation. It takes the right combination of software, expertise, and experience to make cash flow management truly effective.
People don't think about cash flow management until they're in trouble. And that's often too late.
Picture this: A company gets a couple of big contracts at the same time. Everything's going great—until they outgrow their cash flow. Fast growth requires very detailed cash flow management because you typically need cash upfront to fund that growth before you see the revenue.
Fast growth or hitting an obstacle makes cash flow critical overnight. You need to start that discipline of understanding cash flow—how it flows in, how it flows out—at least every month.
Pull your P&L monthly, but also pull your balance sheets and your cash flow reports monthly, not quarterly or annually. Why? Because if you hit high growth opportunities or sudden challenges, you need to be able to dial your cash flow management up immediately.
Ready Founders™ don't manage cash flow reactively. They don't wait for problems to appear or opportunities to knock them off balance.
They build the discipline and systems before they need them:
Start with monthly discipline: Pull your P&L, balance sheet, and cash flow reports every month. Most founders do the P&L part but skip the rest. They might check their balance sheet quarterly, maybe once a year. Cash flow reports? Never. That's backwards thinking. You need to understand the complete picture of how cash moves through your business every single month.
Monitor your receivables and payables actively: Don't just send invoices and hope for the best. Track aging, follow up systematically, and know exactly when money should hit your account.
Use the right tools: QuickBooks for basic bookkeeping, but tools like Fathom, Cash Flow Tool, or Float for actual cash flow insights. At One Degree Financial, we help you identify which tools fit your business stage and cash flow needs.
Build scalable systems: Create processes that can go from monthly to weekly to daily when you need them.
Build systems that work whether you're growing fast or facing obstacles.
Ready Founders™ understand that cash flow management is like having the right team, expertise, and systems in place before the game starts. When change comes—and it always comes—they're ready to dial up their financial management to match the situation.
They know that the discipline of understanding their cash flow monthly gives them the foundation to manage it weekly or daily when growth or challenges demand it.
They recognize that cash flow management isn't just about survival. It's about being prepared to thrive when opportunities arise and weather the storms when challenges hit.
Because in business, it's not just about making money. It's about having the cash flow systems to keep that money working for you when it matters most.
If you're struggling with cash flow, you're not alone—and you don't have to figure it out by yourself.
Ready to build cash flow systems that scale with your success? Take our Cash Flow Readiness Assessment - one of the 8 pillars we use to evaluate founder readiness. See exactly where your systems need to be strengthened before your next growth phase or market challenge hits.
Ready to build cash flow systems that scale with your success? Book a strategy session with our team to identify the right framework and lock in a plan that lasts.
About the Author: Rod Loges is CEO of One Degree Financial and host of the MILCOM Founders podcast, where he helps veteran entrepreneurs build businesses with strong financial foundations.
The Ready Founder™ is part of One Degree Financial's commitment to helping founders gain the financial clarity and confidence they need to scale successfully. Learn more at onedegreefinancial.com.
Want more insights like this? Subscribe to The Ready Founder™ newsletter for practical strategies on building a business that works for you, not against you. Subscribe here.