The 5 Financial Questions Every Founder Should Be Able to Answer

Whether you're pitching investors, planning your next hire or just trying to sleep at night – there are a few financial questions that every founder must be able to answer confidently. If you hesitate on any of these, you’re not alone – but it’s time to close the gap.

Here are the five critical questions you need to know cold:

1. What’s your monthly burn rate?

Your burn rate is how much money you're spending every month. It's the heartbeat of your cash flow.

✅ Why it matters: Investors use this to assess how quickly you’re depleting cash. You should use it to make every operational decision.

📌 Bonus: Know the difference between gross burn (total spend) and net burn (spend minus revenue).

2. How much runway do you have?

Runway = current cash / monthly net burn.

✅ Why it matters: This tells you how many months you can survive at your current pace. It shapes your hiring, fundraising and growth strategies.

🎯 Aim to always have at least 6 months of runway — ideally 12+.

3. How many customers can you afford to acquire?

This is where CAC (Customer Acquisition Cost) meets runway planning.

✅ Why it matters: You can’t just throw money at ads or sales without knowing the return. This number tells you what kind of growth is sustainable.

🔍 Track CAC by channel – not just in aggregate.

4. What does your next hire cost you – and when can you afford it?

Every new person affects both burn and momentum.

✅ Why it matters: Hiring too early kills your runway. Hiring too late slows your growth. Financial clarity lets you hire confidently.

🛠 Use your forecast model to run scenarios (“What if we hire a PM in September?”)

5. What’s your path to profitability?

Even if profitability is far away, you need to know what levers get you there.

✅ Why it matters: Founders who can describe this path are more credible, more fundable and more in control.

💡 You don’t need to be profitable now. But you do need to know how you'd get there.

🧠 Final Thought

You don’t need to be a CFO. But if you’re the founder, you do need to think like one.

Start with these five questions. Build systems to answer them with confidence.
And if you’re stuck in spreadsheets or don’t know where to start – that’s solvable.

Need help building financial clarity? Let's talk.