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Understand startup funding and dilution.

A fundraising story needs more than a large market and an attractive valuation. Connect the operating plan to cash, connect the cash to milestones, and make the ownership consequences visible.

Start my four-step path →Browse all resources

Devon Coombs, CPA, MBAAssistant Teaching Professor of Finance and Faculty Director of Real Estate Finance, Santa Clara University

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Up next: Connect the founder to the business model

Check off a task after you have tried it. Progress saves in this browser when storage is available; this is a personal checklist, not a course grade or certificate.

  1. Free courses · 10-minute starter activity

    Connect the founder to the business model

    Start the first lesson. Describe the customer, the problem, how the business earns money, and the resource constraint that matters most right now.

    Entrepreneurial Finance

  2. Calculators · 10-minute starter activity

    Estimate time before cash runs out

    Try a simple cash balance and monthly net burn. Change the burn assumption. Identify collections, hiring, or one-time costs that a flat-burn estimate would miss.

    Runway & Default Alive / Default Dead

  3. Practical guides · 10-minute starter activity

    Make ownership consequences visible

    Work through the simplified SAFE example. Separate ownership at signing from later dilution, and list the terms you would need before modeling an actual financing.

    SAFE dilution: understand the ownership you sell

  4. Practical guides · 15-minute starter activity

    Explain the ask and the milestone

    Draft the financial part of a pitch: evidence to date, uses of cash, the milestone funded, and a downside plan. Label actual results separately from forecasts.

    Startup pitch financials: what to include and how to explain it

A fictional example · Check your understanding

Runway is a starting estimate

A business with $600,000 in available cash and a constant $50,000 monthly net cash burn has about twelve months of simple runway. At $75,000 per month, that falls to eight months. This assumes no new financing or changes in cash timing.

Is twelve months of runway the same as twelve months available to raise money?

No. Fundraising takes time and cash needs can change. The operating plan should include milestone timing, collection risk, a buffer, and decisions to make before cash becomes scarce.

Questions to ask along the way.

What financial skills should a founder learn first?

Learn cash forecasting, unit economics, runway, financing needs, and ownership dilution. Build an operating plan that connects customer activity, costs, and cash before relying on a valuation headline.

Does a SAFE valuation cap set the company’s final value?

No. A valuation cap is a conversion term, not a promise of a future fundraising price or exit value. The SAFE form, other instruments, new money, and option-pool changes can affect the eventual ownership calculation.

What belongs in a startup pitch’s financial section?

Show historical evidence, the drivers behind projections, the amount requested, planned uses, and the milestone it funds. Explain uncertainty and downside actions rather than presenting an unsupported forecast as a fact.