Ever wondered how small businesses can stay financially healthy with the help of FinTech tools? CEOs and founders, as well as Chief Marketing Officers, are sharing their top insights on this crucial topic. The first piece of advice is to track Revenue Run Rate, while the last emphasizes analyzing Cash-Flow Trends. Get ready to dive into ‌four expert insights that can transform your business’s financial strategy.
- Track Revenue Run Rate
- Focus on Customer Acquisition Cost
- Monitor Cash Conversion Cycle
- Analyze Cash-Flow Trends
Track Revenue Run Rate
Revenue Run Rate (RRR) is particularly insightful because it gives you a future-facing view of your business’s earning potential based on current performance. Using FinTech tools to project annual revenue, based on your latest monthly numbers, allows you to prepare for potential bottlenecks or seasonal downturns. This metric gives you the confidence to forecast accurately, align investments with future cash flow, and adjust sales strategies quickly. I’ve seen businesses shift gears mid-quarter to capitalize on strong run rates, converting forecasts into tangible growth without waiting for the year-end report.
Alari Aho
CEO and Founder, Toggl Inc
Focus on Customer Acquisition Cost
The most critical metric small businesses should focus on is Customer Acquisition Cost (CAC) because it directly impacts profitability. However, traditional tracking methods often under-report because of cookie consent, ad blockers, and privacy restrictions. To overcome this, we integrate a Customer Data Platform (CDP) to better understand where marketing dollars are spent and which channels genuinely drive results. This allows businesses to accurately track CAC, refine strategies, and make data-driven decisions that optimize their marketing ROI.
Mike Zima
Chief Marketing Officer, Zima Media
Monitor Cash Conversion Cycle
Cash conversion cycle (CCC) is a hidden gem-understanding how fast you can turn inventory and investments into cash is critical for survival. This metric reflects how long each dollar is tied up in operations, alerting you when to tighten processes or negotiate better supplier terms. FinTech tools make it easier to visualize this cycle in real time, so you can make adjustments before liquidity issues arise.
Mark McDermott
CEO & Co-Founder, ScreenCloud
Analyze Cash-Flow Trends
One key metric that small businesses should prioritize tracking with FinTech tools is cash-flow trends. While FinTech platforms often provide an abundance of data through beautifully designed charts and graphs, this can sometimes overwhelm busy founders. Instead of presenting everything at once, FinTech tools should focus on highlighting critical shifts in a business’ cash flow.
Founders are time-poor and need concise, actionable insights. A great FinTech tool doesn’t just display static data; it identifies changes in financial performance and prompts founders to take a closer look. By pinpointing fluctuations—such as a sudden drop in cash reserves or irregular patterns in incoming payments—business leaders can zoom in to understand the root causes, whether it’s due to late customer payments or unexpected expenses, and take timely action to safeguard the financial health of their business.
Jack Maddock
Product Manager, Rho