Monthly Management Reporting for Startup CFOs

Great startups are powered by great monthly management reporting. Find out what the best startup CFOs include in their reporting.
Monthly Management Reporting for Startup CFOs

Anybody who has worked at both a startup and a traditional business knows very well how different they are. However, they also have some things in common. And one of them is the challenge of making internal communication fast and effective.

Startups are places that change very fast, and it can be hard to know what’s important to keep an eye on. Every day, founders have less time to follow all the small details and need to focus on the most important and urgent issues of the business. For the board it’s even tougher as they’re often not in the company day-to-day. And here is when monthly reporting comes extremely handy for them.

Top-notch communication with the board is the key to help best leverage their expertise and help them understand where to spend their time. The board desperately needs good reporting, because it makes their job suddenly easier, effective, and they can know where to focus their time to add the most value.

What should a good report include?

We want to help startup CFOs understand what they should focus on in order to deliver effective reports. So before jumping into the nuts and bolts of great monthly reporting for startups, we believe it is worthy to stop and ask - What exactly is the goal of monthly reporting? What are we trying to achieve here?

Let’s keep it simple. A good report is one that helps the whole team understand the state of the business, what things are changing, and what are the good and the bad things that triggered those changes. And that’s it. If you have that sorted, the rest is just padding.

Now, let’s take a look at what you can’t miss.

Business Snapshot

Try to put the important things first. So your first two slides should be about MRR, ARPA, subscribers and your critical ratios such as churn and cohort analysis if you are a SaaS business,.

Also, break down MRR if possible and do so with your subscribers into types of plan, new vs. retained...

Break your reporting into teams

It’s very useful for the board to know how each team is doing - it helps them understand the pulse of the business. That’s why breaking up the report into 1-2 slides per team comes very handy. Let’s take a look at an example of what good reporting can look like for marketing, customer success, people and finance.

A small note before jumping in: this might seem obvious, but always remember to compare your numbers to previous months and even YoY. Numbers by themselves don’t mean anything. Also, bear in mind that this needs to be tailored to the type of business. For example, what’s important for B2B SaaS may not be important for a Direct-to-consumer business. Having said that, after your “Business Snapshot”, you may include some slides for:

Marketing: you need to show how customer acquisition is going. Do it in one slide if possible and try to include CAC, acquisition spend, and new accounts (broken down in the types of plans, which always helps). Also include LTV.
Customer success: if you have a customer success team, it is also important to dedicate a slide or two. Include NPS and KPIs about the number of success or support interactions.
People: again, depending on the type of company you have you should make small modifications to better reflect your business, these are just guidelines.Since payroll is oftentimes the biggest expense it’s also worth including that, along with data about joiners, leavers and vacancies.
Finance: in terms of finance, it’s pretty straight forward. Make sure to include your revenue and EBITDA, as well as your monthly P&L, comparisons to budget and YoY.
Since cash is king in startups, also make sure to include a slide on cash flow, which means your bank balance, comparison to plan and an estimate of your remaining runway.

The #1 problem to get reporting done on time

Startups are usually fast-paced environments. In other words, everybody has a ton of different things to do at a time (especially a CFO) and has no room for stopping. And we say this because, in order for reporting to come at the right time, you need to close the books fast.

And that is harder than it sounds.

Chase people for invoices, chase people for SaaS tools purchases… This is all a mess. That’s why we created Cledara, which automatically reconciles SaaS invoices to their respective payment, and pushes them to your accounting software automatically every month.

And suddenly, reports are on-time!

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This post was inspired by questions provided by people like you. We love receiving new and interesting questions that help us think about data in new ways. If you found this post interesting and have other questions about startup strategy that you’d like us to help answer, drop us a line at hello@cledara.com.

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