Bessemer finance leader: You need 2 years of cash to survive

Veteran CFO Jeff Epstein says it’s time to make a change if you can’t support yourself into 2022.

Try to have two years of cash on hand to survive COVID-19, Bessemer Venture Partners CFO Emeritus Jeff Epstein says. If you can’t come up with that, it’s time to change your plan, the long-time finance executive and former Oracle CFO said last week in a CFO Thought Leader podcast.

“Our advice the first week of the lockdown was, ‘We don’t know how long this is going to last or if there’s going to be a second wave, so you should try to get to two years worth of cash,'” said Epstein, Bessemer’s operating partner. The venture capital firm was an early investor in some of the biggest names in technology, including Pinterest, LinkedIn, Shopify, Yelp, Twillo and Twitch, and today is an early-stage investor in some 90 startups.

Epstein advises CFOs to divide the amount their company is losing each month into their cash and, if it comes out to less than 24, it’s time to call their vendors to get lower prices, stop making discretionary purchases and take a hard look at layoffs.

Source: CFO Dive (2020)

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