, a consulting firm with clients ranging from international giants to recent startups, while Leslie is a retired entrepreneur and lecturer at Stanford Graduate School of Business. Cash is the literal lifeblood of a business, and your plan should be clear about where its money comes from and where it goes.
Leslie shared similar sentiment regarding cash and expenses. Small businesses often go under because founders don't understand or utilize the concept of accrual accounting, a method that records revenue and expenses when transactions occur rather than when payments are made or received, he said. On the flip side, Wunker says founders that have a healthy skepticism about the realities of their business are more able to anticipate potential challenges.
"Most entrepreneurs start with the answer, not with the problem, and they ignore innovation opportunities that way," Wunker said. In many cases, Wunker says customers use solutions from a range of categories, like video games or miniature golf, to satisfy a more central need, like weekend entertainment.Base your revenue model on necessity, not wishful thinking
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