The Cash Flow Risk Simulator (CFRS)
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I've made this tool called the Cash Flow risk simulator, from the very obvious name you can tell what it does, it basically takes simple financial records whether tangible or intangible, and quantifies the probability of failure. As a business owner the thought of your business failing is always something that looms overhead of founders alike. With my tool you can better understand the risk of failure, how much runway you have, and how to optimize for the lowest chance of failure. The product is still in beta and feedback on my software would be much appreciated. The link for the product will be in my profile if anybody would like to test the early stages of a much bigger vision.
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Interesting idea—cash-flow risk is especially difficult to evaluate before a startup has stable revenue. I like that you model the probability of failure rather than presenting one fixed forecast.
How does the simulator handle uncertain assumptions, such as revenue starting later than expected or infrastructure costs increasing? A sensitivity view showing which assumptions have the greatest effect on runway would be particularly useful to me as a bootstrapped solo founder.
@vasyl_kyryliuk I appreciate the feedback, an intangible variable like the variation in income is a challenge to make an educated probability. My current solution is getting a qualitative answer, ranging from "Steady" to "Variable", then quantifying the result into a set multiple that influences the current cash balance and other known factors to equate for. The model is in beta but I'll be sure to add more variables to calculate for more accurate results.
@raphael_c_sena That makes sense for an early version—qualitative inputs are much easier for founders to estimate than pretending they know an exact probability distribution.
One improvement that could build trust would be showing how each answer changes the result. For example, “Variable income reduced estimated runway by X months” or displaying optimistic, expected, and stressed scenarios side by side.
Allowing users to adjust the multiplier behind categories such as “Steady” and “Variable” could also make the model more useful across very different businesses. I’d be interested to test it as you add more variables.
@vasyl_kyryliuk I've already updated the simulator from the original feedback you gave me, and I have made a system that would calculate which input that is given to the main framework and determine which factor is most likely to bring your chances of cash burn out higher. As apart of the first 1.0 version I made sure to include optimistic ,expected, and stressed scenarios as well as the utilization of a line graph to keep it simple enough to understand. Once I've optimized the math to better understand the consumers financial position, I would love for you to be one of the testers for my software, your comments have been of great advice for me to understand the perspective of the actual consumer. (If you would like you can test the current version of the simulator, I have it linked in my profile. While the UI is bare and features are still limited, the core logic is already in place.)
@raphael_c_sena That’s great to hear, Raphael — I’m glad the feedback was useful and that you’ve already incorporated it.
The optimistic, expected, and stressed scenarios together with the factor-impact view sound like a strong direction. Yes, I’d be happy to test the current version and provide structured feedback, especially from the perspective of a bootstrapped, pre-revenue solo founder.
I’ll check the link in your profile. For the test, is there a particular workflow or part of the model you would most like me to focus on?
The optimistic, expected, and stressed scenario approach is smart, it avoids the trap of presenting one number as if it were certain. I built FounderFlow around a similar idea but for day to day operations instead of long term risk, it grades its own confidence instead of treating every signal as equally trustworthy, because a founder trusting a wrong number is worse than a founder knowing to double check it. Curious if you have thought about a live version that updates as actual numbers come in, versus this being closer to a periodic planning exercise.
@stacywycof83995 This thought has definitely crossed my mind before hand. Where the founder can link their financial data from other SaaS tools or whatever system that they use to handle financial records, (There would be an option to manually input records if needed), and my system would give an updated probability along with updated metrics on each one the inputs given, providing greater accuracy for long term cash flow predictions and day to day clarity on the operations of said company. If you would like you can also test my tool for a better grasp of my current progress and what you believe would be a useful addition for yourself and other founders alike.