If you’re building a startup or leading an emerging growth company, you’ve probably felt the pressure of today’s fundraising climate. Traditional sources of capital have slowed, valuations are tighter, and investors are scrutinizing every dollar you spend. In this environment, you can’t afford to leave cash management on autopilot.
The truth is, managing working capital isn’t just about keeping the lights on. It’s about extending your runway, reducing risk, and positioning your company to weather uncertainty while seizing opportunities. And the person who can make the difference here is your CFO.
What working capital really means for you
At its core, working capital is the cash your business needs to operate — paying salaries, funding product development, buying inventory, or covering day-to-day expenses. The drivers of your working capital needs are your size, stage, and most importantly, your business model.
But here’s the part many founders underestimate: it’s not just about how much cash you have, it’s about how much time that cash buys you. Do you have three months of runway? Six? Twelve? That timeline dictates whether you’re negotiating with investors from a place of strength or desperation.
The CFO’s first role: keeping you informed
As a founder, you need more than just a bank balance. You need clarity. A seasoned CFO will give you both the raw numbers (“you have $300,000 left”) and the critical translation (“you have six months of runway”).
This is more than reporting, it’s about building trust. Investors, employees, and even prospective partners want confidence that you understand your financial position. Transparent, accurate, and scenario-based reporting gives you that credibility. Without it, you’re flying blind.
The CFO’s strategic role: creating options
Here’s where working capital management becomes strategic. Raising equity isn’t your only lever, and in today’s tight fundraising market, it may not even be your best one. A strong CFO can help you unlock other strategies, such as:
- Negotiating better terms with customers and suppliers
- Using stock options or equity grants to conserve cash for payroll and vendor expenses
- Leveraging convertible debt or SAFEs for faster, more flexible funding
- Factoring receivables to turn sales into immediate cash
- Exploring loans or alternative financing
Often, the smartest path forward is a mix of strategies tailored to your stage, risk profile, and goals. A CFO who understands your unique position will help you choose the right combination, maximizing working capital while minimizing risk.
Why this matters now
In this environment, your margin for error is slim. Every extra month of runway gives you more negotiating power, more time to hit critical milestones, and more opportunities to prove traction before your next raise. Conversely, mismanaging working capital shortens your options and forces decisions you may later regret.
Put simply: effective working capital management could be the difference between becoming the company investors fight to fund or the one that quietly runs out of cash.
How successful startups get it right
The most resilient startups don’t just monitor cash flow, they actively manage it. They pair tactical discipline with strategic foresight. They use their CFO not as a back-office accountant, but as a partner who helps them navigate uncertainty and chart a course toward growth.
If you’re serious about building a lasting company, now is the time to tighten up your approach. Working capital management isn’t just financial housekeeping. It’s survival. And it’s opportunity.
If you want to strengthen your financial foundation and extend your runway, reach out to see how Kranz can help you with CFO services and fundraising support.