Editor’s note: The following post was developed based on insights shared at Startup Boston’s “Show Me the Money: Using Metrics to Build Your Company Operations.” Held on September 19  during Startup Boston Week, the session featured a panel of experts from across a range of companies, including Espresso Capital Director of Loan Origination, Mark Gilbert

Of everything that goes into starting a company, developing processes and practices that help establish financial stability is arguably the number one priority of any business. No matter how incredible or innovative the work you’re doing is, if you haven’t secured proper funding to support your business, it won’t survive. 

The first step is knowing how to conserve cash before you reach your first round of funding. As your company grows, a deep understanding of your financials and what type of support you need to thrive becomes even more important. The following tips will help set you up for financial success. 

1. Always start with a plan as the foundation of your business. 

No matter how much it ends up shifting and evolving, you need to have a plan that sets your  strategic direction and that you can always come back to. At the most basic level, it should involve a financial model built in Excel that shows how you’re going to get where you want to over the next six to twelve months. It doesn’t need to be elaborate, and if you’re not familiar with Excel, it’s worth taking the time to learn it. 

A well thought out plan is essential at every stage, not only for your internal team but also to show investors who want to understand your vision and what type of growth you’re working toward. 

2. Be creative when coming up with solutions for sustaining your business.

Before securing funding from a debt provider or investor, it’s important to be resourceful when it comes to cash flow. The goal is to get cash as soon a possible, so use your plan to forecast when sales will happen and arrange for payment sooner than later. A great way to do this is by factoring invoices, which means taking a percentage of payment in advance and paying interest on the sale when you receive the cash from your customer. 

You can also leverage relationships with vendors to help sustain your company. Taking the time to get to know companies you’ve hired will help build their trust and make them more likely to allow payment term extensions, should you need it. 

3. Adopt an investor mindset from the beginning.  

The better you understand how investors think and what they’re looking for, the more you’ll be setting the company up for success. Always start with the why behind your business, clearly articulating the problem and selling yourself as the best possible solution. 

Investors want to see exactly how — and by how much — you’re going to grow. Know that they are likely going to reduce your projections, so it’s good to be aggressive but realistic. What really matters is that you have a story to back your projections up. It’s also important that you understand and are prepared to speak to the metrics your lenders care about most. At a high level, those include revenue growth, efficiency, retention, cash burn, CAC/LTV, and cash preservation. 

4. Take the time to understand your debt options and stay open-minded when considering investors. 

There’s a lot that goes into deciding when and what kind of debt you want to take on when growing your business. To be successful, it’s crucial that you understand the different types of debt, including venture debt, and what options are available to you based on what stage your company is at and how quickly you’re going to grow. 

With everything that goes into founding a start-up, it can be easy to put off fundraising to focus on things that seem like more of a priority at the time, but that’s a big mistake. Treat fundraising as a long-game, making sure you’re not waiting until you need an investor to start looking for one. Keep an open mind and really get to know who your potential investors are, so you’re prepared and feel good about your decision when it comes time to secure funding.