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If an Airplane overshoots the runway in an attempt to land, it most likely crashes! Same way with Startup management. If your Startup Overshoots the Runway, it crashes and out of funds means automatic death for any business.

So, you really need to keep a keen eye on your Runway!

I had a related conversation with a good friend of mine two weeks ago. I had received a worrisome email from him a few weeks earlier but I didn’t respond, so he followed up with a call. They had retrenched the whole team in my region (they are a Fintech startup in about 10 countries across 3 continents) and when I enquired, he brushed me off a bit and said it was due to Covid19 impact on their business. I queried further and he said it was decided above, that management felt they needed to protect their Runway to make sure it extends to at least till 2022. They had just raised over $40million and it would be impossible to go back to funds market, besides that would also look back on shareholders view.

Paul Graham wrote a great post in which he defines a startup as a “company designed to grow fast” and encouraged founders to constantly measure their growth rates. For Y Combinator companies, he notes that a good growth rate is 5 to 7 percent per week, while an exceptional growth rate is 10 percent per week.

According to Techcrunch, if you’re hoping to be a public company, you should be growing significantly faster (by percentage) the smaller you are. The median company with revenues between $0 and $25 million grew at a whopping 133 percent. As these companies scaled to the $150 million to $500 million revenue range, they grew at a more modest rate of 38 percent per year.