CJ Gustafson
@cjgustafson222
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I tweet about financial metrics and business models | Startup CFO | Opinions are my own, not investment advice
Joined December 2017
What's the difference between Venture Capital and Private Equity?. A lot. Read on:
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GymShark is beating Nike, Adidas, and LuLu Lemon at their own game. And they're doing it by way of Accounting. It's called the cash conversion cycle. Here's how it works:
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The median CFO salary in the United States is $393,377. There are multiple paths you can take to this powerful position. If you're in finance, here's what you should know about becoming a CFO:.
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Financial metrics reveal a company's story. Here are 8 threads on financial metrics. That EVERY business owner and investor should read:.
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The median CFO salary in the United States is $393,377. There are multiple paths you can take to this powerful position. If you're in finance, here's what you should know about becoming a CFO:.
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What's the difference between Venture Capital and Private Equity?. A lot. Read on:
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The median COO salary in the United States is $464,033. There are multiple paths you can take to this powerful position. If you are in business, here's what you should know about becoming a COO:.
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Airbnb, Uber, and Etsy are all billion dollar marketplaces. Have you ever wondered what they make on each transaction? . Here’s a comprehensive list of marketplace Take Rates.
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GymShark is beating Nike, Adidas, and LuLu Lemon at their own game. And they're doing it by way of Accounting. It's called the cash conversion cycle. Here's how it works:
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According to the Boston Consulting Group, there was more than $1.7 Trillion in M&A deal activity in just the first half of 2022. Here are the 9 most common M&A Strategies, all on one page, with real life examples.
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Wait, Expensify has 138 employees and does $170,000,000 in revenue per year???. That is NUTS!!!!. That's more than $1 million per employee. Can anyone think of a more efficient company on a per head basis?
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Stop wasting your time with vanity metrics. Start tracking these 15 proven business metrics. (They all come from real startups).
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GymShark is beating Nike, Adidas, and LuLu Lemon at their own game. And they're doing it by way of Accounting. It's called the cash conversion cycle. Here's how it works:
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If I had to explain the SVB Bank run to my 93 year old grandmother (who keeps her money at Dedham Community Savings Bank), here's what I'd say:.
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Less than 4% of stock pickers beat the market. Many have gone dead broke trying. A select few have made billions. Here are the ways it's been done:.
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Most people assume I became a startup CFO by staying up late to study balance sheets and build DCFs. False. I just copied what these CFOs said on FinTwit:.
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What's the difference between a marketplace, an aggregator, and a platform?. A lot.
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So what does a VC Term Sheet actually look like?. Let's break down the key elements of a basic term sheet:
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Financial metrics reveal a company's story. Here are 10 threads on financial metrics. That EVERY business owner and investor should read:.
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So what does a VC Term Sheet actually look like?. Let's break down the key elements of a basic term sheet:
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Airbnb, PayPal, and Uber. All built billion dollar empires using network effects. These are the metrics they track (and you should too):.
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Financial metrics reveal a company's story. Here are 8 threads on financial metrics. That EVERY business owner and investor should read:.
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What's the difference between a platform, a marketplace, and an aggregator? . A lot.
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Not all cfos who use a MacBook go to jail, but all cfos who went to jail were using a MacBook.
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This is a Net Present Value of money crime my dude.
The Dodgers’ payouts to Shohei Ohtani for the next 20 years:. 2024:$2M.2025: $2M .2026: $2M.2027: $2M.2028: $2M.2029: $2M.2030: $2M.2031: $2M.2032: $2M.2033: $2M.2034: $68M.2035: $68M.2036: $68M.2037: $68M.2038: $68M.2039: $68M.2040: $68M.2041: $68M.2042: $68M.2043: $68M
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How do you differentiate between "High Tech" vs "Tech Enabled" companies?. Read on:
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I've used this pitch deck formula to raise over $700,000,000. You can steal it.
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What's the difference between Venture Capital and Private Equity?. A lot. Read on:
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How many different ways can you calculate NDR? . At least 25.
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I think this is the best chart CB Insights has put out in a while. Crazy to think some of these companies have been growing revenue 50%, even 75% or more y/y since ipo…. But their valuations are going in the other direction. Very indicative of the loco times we were in .H/T
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Financial metrics are the lifeblood of any business. But these 9 mistakes can destroy a company:.
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I've spent half of my career trying to nail one formula:. LTV to CAC. (that's lifetime value to customer acquisition cost). The following threads will allow you to harness the powers of LTV to CAC:.
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Stop wasting your time with vanity metrics. Start tracking these 15 proven business metrics. (They all come from real startups).
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Secrets of the business world I wish someone let me in on sooner:.
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How does the Finance department's structure evolve at a startup over time?. I've been exploring this first-hand as a CFO. Read on:
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The median cash compensation for an account executive selling software is $235,000 to $250,000 per year. ICONIQ dropped a BANGER of a report, with all the key facts and figures on sales rep comp. Here are the best takeaways:
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I lost $209,640 of my own money trying to start a business. Writing about failure sucks. But here's the real story:
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AI startup Tome rumored to be raising at a $600m valuation on $2m of revenue. …300x current ARR. If so… we are SO back
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It's here - the 2022 SaaS Fundraising Napkin. What did you need to raise money this past year?. We've summarized Seed to IPO, all on one page:
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10 mistakes you're making with financial metrics (and how to fix them):.
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Excited to announce that Mostly metrics has added a talented female, Cameryn Gustafson, to the writer’s room! 👧🍼🐣
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What's the difference between a marketplace, a platform and an aggregator? . More than you think. Read on:
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How do tech companies talk about their Cost of Revenue?. Well, it depends. I’ll admit it - I probably talked about Cost of Revenue in hand wavy, theoretical kinda way for the first five years of my career (OK, first six). I kinda sorta understood what was shoved up there from
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Airbnb, PayPal, and Uber. All built billion dollar empires using network effects. These are the metrics they track (and you should too):.
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How do vertical SaaS companies make money?. It's called the Layer Cake Strategy . (and it generates $ billions):. Most vertical SaaS companies start by solving one specific use case for one industry persona, and then expand their offerings to cover other aspects of their day to
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Dilution is one of the most misunderstood concepts in startup land. But many employees are afraid to ask for a simple explanation. Here’s how it works:
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An estimated 327,000 people applied to work in private equity last year. Less than 3% got a job. Here's what you should know about the industry if you're looking to break in:.
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@MavenHQ @substack The first area to be disrupted will be business education. More specifically:. -private & public marketing investing,.-finance & accounting, and .-product marketing. Who are the potential teachers? . How can you get your hands on some of this content today (mostly for free)?.
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Stop wasting your time with vanity metrics. Start tracking these 15 proven business metrics. (They all come from real startups).
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Whether you’re a VC or founder, understanding Term Sheet terminology is CRITICAL. Here are 12 terms you MUST know:.
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How do you calculate Net Dollar Retention Rate? Here's how 25 top tech companies do it. You can copy these real life examples:. (find the full breakdowns at
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The median CEO salary in the United States is $798,373. There are multiple paths you can take to this powerful position. If you're in business, here's what you should know about becoming a CEO:.
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How do marketplaces make money? . It’s called a take rate . If you’re talking the lingo, other common names for this type of middleman compensation include:.•Commission.•Vig.•Rake. I studied the economics of 35 marketplaces 🤑. Get full report
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According to Bloomberg Law, there was $559 Billion in M&A activity in Q1 2023. Here are the 9 most common M&A Strategies, all on one page, with real life examples.
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“Beware of all green dashboards.” . This is one of my favorite stories about both the power and danger of metrics. Metrics can be a proxy for truth, but only if you measure them correctly. Don’t lose sight of the anecdotes.
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At the risk of pissing off all the financial analysts. I think Discounted Cash Flow models are stupid. Six reasons why DCFs suck:.
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Trying to hit it big at the next company you work at? . Understanding how employee stock options work is your key to long-term wealth:
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Bold claim (screw it, wish me luck!) - I’m pioneering a new category - Operator Equity Research. 👇
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How much equity do CEOs own when their company goes public?. It's less than you think. (source: Harvard Business School)
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According to the Boston Consulting Group, there was more than $1.7 Trillion in M&A deal activity in just the first half of 2023. Here are the 9 most common M&A Strategies, all on one page, with real life examples.
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How do vertical SaaS companies like Toast and Shopify make money?. It's called the Layer Cake Strategy (and it generates billions of dollars):.
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Ex-Salesforce CFO's advice to his younger self: 5 key lessons for finance leaders in startups.
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I knew an entrepreneur who used to put all his checks to suppliers in the microwave. Here's the crazy story, and what it taught me about the cash conversion cycle
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To go one level deeper, we can categorize private market investors by stage: . 1/ Angel: Individuals.2/ Seed: 1st institutional check.3/ Growth: Series A - C.4/ Late Stage / Crossover: C through IPO.5/ Buyout: Majority control, Debt. Note: There IS OVERLAP. Let's dig into each.
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If I could only choose one metric to evaluate a company. I'd chooose revenue per employee. Why?. It cuts through all the noise. And there's no hiding.
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What's the difference between Renewal Rate and Retention Rate?. A lot. Read on:
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WTF is a DCF model?. I lived inside of Discounted Cash Flow models for years. And will explain them SIMPLY:
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When a Billion Dollar Outcome Isn’t Enough:. Venture fund returns typically follow a power law (e.g., 80% of the returns are generated by 20% of the investments). As a rule of thumb, investors will often want to see a scenario where any given company could theoretically return
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The State of the CFO Tech Stack as we enter 2024:. TL;DR:.3 observations:.I. The proliferation of FP&A tools.II. NetSuite never dies.III. A new Big 3 in expense management. 2 opinions:.IV. How stuff gets bought has changed.V. How stuff gets trialed still needs to change. 1
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How do vertical SaaS companies make money?. It's called the Layer Cake Strategy (and it generates billions of dollars):.
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What I wish I knew as a first year CFO. 5 timeless lessons from Mark Hawkins, former CFO of Salesforce. 1. Know your business cold. You must know how your biz makes money, and what your biz spends money on, better than anyone else. Full stop. Although you may not “own” the.
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The leading cause of death. For businesses in the US. Is poor cash flow management. 8 threads so you can avoid going broke:.
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First, it's important to know what a CFO's day-to-day responsibilities are. They can be split into three buckets. 1. Financial Strategy, .2. Reporting, and .3. Book Keeping.
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How does dilution impact you as a startup employee?. Let's go through a (lucrative) example:
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I’ve examined a lot of term sheets in my career. So I decided to break down the key components . As well as the red flags that could hurt you . It’s all in todays mostly metrics issue .
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COO's can be split into six types: . 1. The Executor.2. The Change Agent.3. The Mentor.4. The Systems Wizard.5. The CFO as COO.6. The Sales and Marketing Genius.
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Deadly mistakes first-time FP&A managers make . (A brain dump, based on 10,000 hours of budgeting):.
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How does a CFO think about software spend?. If you are looking to sell to a CFO,. Or if you are looking to get budget buy in from your CFO, read on:.
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First, it's important to know what a CFO's day-to-day responsibilities are. They can be split into three buckets. 1. Financial Strategy, .2. Reporting, and .3. Book Keeping.
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Vertical SaaS is everywhere - you just don’t realize it. Let's uncover examples of vertical SaaS impacting your everyday life in major ways:
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The finance software stacks of top start-ups we've interviewed on Run the Numbers so far:
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Reporting includes:.-3 statement modeling (Income statement, Balance sheet, Cash Flows).-Analysis of budget to actuals .-Budget re-forecsating.-Board reporting.-Earnings releases. cc: @10kdiver .
1/. Get a cup of coffee. In this thread, I'll show you how to read and understand a company's Balance Sheet. As investors, we should be able to judge businesses by looking at their financial statements. And the Balance Sheet, of course, is 1 of 3 key financial statements:
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Private Equity and Venture Capital are often used synonymously. Both invest in private companies whose shares are not publicly traded on exchanges. However, VCs generally invest earlier in a company's lifecycle than PE.
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Yesterday my newsletter hit 5,000 subscribers. I went from hopelessly screaming into the abyss to riding rocket ship. This graphic sums up the journey. Some humble tips for those who want to build an audience:
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I have a degree in finance. But I wish I learned these 7 tactical skills before taking my first job. You can learn them here on twitter:.
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Yesterday my newsletter hit 10,000 subscribers. I went from hopelessly screaming into the abyss to riding rocket ship. This graphic sums up the journey. Some humble tips for those who want to build an audience:
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My goal is to create the best valuation and performance benchmarks specifically for tech operators. If you are in Finance, Strategy, or Ops, this will help you translate what the outside world values to your target operating model. Here are this week’s multiples:
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Security unicorn Lacework is reportedly being acquired by rival Wiz for $150M to $200M, significantly less than the $8.3B it was previously valued at, and the $1.8B in capital it raised. If that's the case, Wiz will acquire them for ~2x NTM Revenue.
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How does the "middleman" make money?. It's something called a "Take Rate". And getting your Take Rate right can make or break your biz. Here's a crash course:
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As a “finance” person I’m begrudgingly realizing:. -the CEO’s job is sales.-the law firm partner’s job is sales.-the investment banking MD’s job is sales.-the big four tax consultant’s job is sales. It’s not enough to just be an expert in your domain, you have to know how to sell.
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How top tech companies calculate ARR 👇. Annual recurring revenue isn't as straight forward as you'd think. I analyzed how 20 companies define and calculate their annual recurring revenue. Regardless of whatever you think about ARR as a "good" measure of business success, or
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