A CEO’s Somewhat High Financial Projections

I read an article in the NY Times about why one CEO, the article’s author, tends to aim too high on his financial projections. I thought it applicable to share here.

Here are some excerpts from the article, Why I Tend to Project a Little High, that I particularly like and agree with:

————————-

“Investors — especially venture-capital investors — demand aggressive “hockey stick” growth curves for revenue and profit. They want big multiples, and they want them in short time frames. They want to know what’s being targeted and what the chief executive believes is achievable. If they don’t see optimism, if they aren’t buying into a dream, they are reluctant to invest.”

“We typically prepare our financials, or budgets, for the following year a few months before the current year ends.This is extremely difficult for a fast growing business.”

“Aiming high is a major motivator and can create growth — perhaps not as much as you projected but still substantial.”

——————————-

To read the entire article and view additional thoughts on high financial projections by Tom Szaky, CEO of TerraCycle, go to Why I Tend to Project a Little High.

 

Advertisements

About Tiffany C. Wright - The Resourceful CEO

Tiffany C. Wright is the author of “The Funding Is Out There! Access the Cash You Need to Impact Your Business” and “Solving the Capital Equation: Financing Solutions for Small Businesses.” She is the founder of The Resourceful CEO, which helps owners of small/medium-sized businesses prepare their businesses for sale. Tiffany has an MBA from the Wharton School of Business, sits on non-profit boards and serves as a business mentor with the Cherie Blair Foundation.
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s