Growing companies don’t usually fail because of one dramatic mistake. More often, they struggle because of small financial blind spots that compound over time.
Below are five common areas where businesses lose control — and why they matter.
1. Why EBITDA Surprises Boards
(Company profits (before interest, taxes, depreciation, and amortization) end up being different from what the board expected)
Boards don’t get upset because EBITDA is low; they get upset because EBITDA is unexpectedly low. The surprise is the real problem.
Most EBITDA shocks happen because the business is running faster than the reporting. Operations make dozens of small decisions every week that never get surfaced until the quarter closes. A discount here, a rush shipment there, a hiring decision made under pressure, none of it feels big in the moment. But when those micro‑decisions stack up, they reshape the quarter.
Boards expect EBITDA to behave like a scoreboard. But inside the company, EBITDA behaves more like a moving target.
The companies that avoid surprises aren’t the ones with perfect forecasts, they’re the ones with real‑time visibility into the decisions that shape the number long before it hits the board deck.
2. Cash Flow Mistakes Founders Make
Founders don’t usually run out of ambition. They run out of cash even when the business looks successful.
The biggest mistake? Believing momentum will cover the burn. A founder sees sales growing, traffic rising, interest building, and assumes cash will follow. But cash moves on its own timeline. Customers pay late. Expenses hit early. Growth eats liquidity before it produces it.
Other traps are just as dangerous:
- Hiring too early
- Scaling before unit economics work
- Treating debt like a bandage
- Forecasting monthly when the business changes weekly
Cash flow isn’t a finance function. It’s a survival skill. Founders who master it stay in the game long enough to win.
3. Retail Margin Leakage
(Retailers lose profit in small, hidden ways)
Retailers rarely lose margin in dramatic moments. They lose it quietly.
- A promotion that runs a week too long
- A reorder was placed out of habit instead of data
- A supplier who nudges terms from 30 days to 45
- A store manager who discounts to hit a target
- Shrink that gets written off as normal
Individually, these don’t look like problems. Together, they drain the business.
Margin leakage is the slow bleed that retailers don’t feel until the quarter ends and by then, the damage is already baked in. The retailers who win are the ones who treat margin like a fragile asset, not a byproduct of sales.
4. Working Capital Traps
(Cash gets stuck in inventory, receivables, or payables)
Working capital is where companies quietly suffocate. On paper, everything looks fine — revenue is up, orders are strong, customers are happy. But behind the scenes, cash is stuck in places it can’t escape.
For example:
- Inventory grows faster than sales
- Receivables age while payroll stays current
- Vendors tighten terms just as customers delay payments
- Growth consumes cash instead of generating it
The trap is simple: the business expands, but liquidity shrinks. Leaders assume growth will fix the problem, but growth often makes it worse.
Working capital discipline isn’t about squeezing vendors — it’s about designing a cash cycle that matches the rhythm of the business.
5. Forecasting for Growth Companies
(Predict future revenue, expenses, and cash needs)
Fast‑growing companies don’t struggle because they can’t forecast. They struggle because they try to forecast like stable companies.
Traditional forecasting assumes the world behaves.
Growth companies live in the opposite reality.
Sales cycles shift. Hiring ramps slip. Customer churn spikes. Capacity hits a wall. A single assumption breaks the entire model.
A good growth forecast isn’t a spreadsheet it’s a living system. It updates as the business moves. It highlights pressure points before they become crises. It shows when to push and when to slow down.
Forecasting isn’t about predicting the future. It’s about giving the company enough visibility to avoid driving off a cliff.
