Cash flow problems are one of the main reasons profitable businesses fail. You can be making a healthy margin on paper, but if you run out of cash at the wrong moment, your business grinds to a halt. I often tell founders that forecasting is like turning the headlights on when you are driving at night. Without it, you are moving fast, but you have no idea what’s coming up on the road.
The truth is, almost every business needs a cash flow forecast. Tim, my co-founder, often says that 99% of companies will require one at some point, unless they are so cash-rich that forecasting adds no value. From my own experience, the companies that embrace forecasting gain confidence to invest, hire, and grow. Those who ignore it often find themselves paralysed by uncertainty.
This guide will take you through what cash flow forecasting is, why it matters, and how to build one that actually works.
At its simplest, a cash flow forecast is a projection of the money coming in and going out of your business over a period of time. It gives you visibility over whether you can pay your bills, invest in growth, or simply keep the lights on.
Many founders confuse a cash flow forecast with a profit and loss statement. They are not the same thing.
You can have a profitable business on paper, but if you have a long lag between sales and payments, you may still run out of cash. Forecasting makes those gaps visible before they become crises.
Tim once told a story about a business with £2 million in revenue and strong profits. On the surface, everything looked great. But the owner was hesitant to invest in staff or even buy a property because he simply did not know what the next 12 months of cash flow would look like. The uncertainty kept him awake at night.
Once we introduced proper financial reporting and built a cash flow forecast, everything changed. He could finally see ahead. He had clarity on when money would come in, what obligations were coming up, and how much room he had to invest. He went from stressed and cautious to confident and decisive.
That is the power of forecasting. It does not create money, but it creates confidence. And with confidence, founders can make better decisions.
From overwhelmed by receipts to confident with clarity: the difference cash flow forecasting can make.
So, what makes a cash flow forecast actually useful? In my experience, there are four essential elements:
A lot of founders I meet have some form of spreadsheet they built themselves. That is a start, but it rarely captures the full picture. A proper forecast should follow these steps:
Cash flow forecasting is not a “nice to have.” It is the foundation for confident decision-making. It is what lets you invest in growth, hire the right people, and sleep at night knowing you will not run out of money unexpectedly.
As I often tell founders, profitable businesses don’t fail because of poor margins. They fail because they run out of cash. A forecast is the simplest, most effective way to prevent that from happening.
At Axcelera, we help businesses put the right layers in place: bookkeepers to keep the numbers moving, controllers to build the forecasts, and CFOs to turn them into strategy. That way, you get the clarity you need, without paying a CFO to update spreadsheets.
Axcelera delivers a full-stack finance function through four service areas.
Each layer works together to provide businesses with tailored financial expertise at every stage of growth.
Want to see how other scale-ups are handling these challenges?
Watch our recent podcast episode, SMEs: From Chaos to Clarity, featuring Rupert Lee-Browne (CEO of Caxton) alongside Axcelera Co-Founders Michael and Tim.
Q: What does a Fractional CFO do?
A Fractional CFO brings commercial insight without the full-time cost. They step in to guide strategy, build forecasts, and support fundraising, so founders can focus on growth.
Q: How much does a Fractional CFO cost in the UK?
A full-time CFO in London can cost over £150,000 per year. A Fractional CFO service is typically 40–60% less, with flexible day rates that start from a few hundred pounds, depending on the level of support you need.
Q: What is the difference between a CFO and a Financial Controller?
A CFO focuses on strategy, growth, and investor relations. A Financial Controller ensures reporting and processes are accurate, so the CFO has the right data to make decisions.
Q: Why do businesses choose Fractional CFO services instead of hiring full-time?
Every ambitious business will eventually need a CFO, but not all the time. A Fractional CFO gives you flexibility, cost efficiency, and senior expertise exactly when you need it—without paying for capacity you don’t.
Q: How do I know if my startup needs one?
If you are preparing for fundraising, expanding internationally, or struggling to get visibility on cash flow, a Fractional CFO is often the right choice. Take our free two-minute Fractional Finance Assessment to see whether your business needs a CFO, Controller, or Bookkeeper right now.
A fractional CFO is not just a financial manager. They are a strategic partner who helps you unlock funding, build better forecasts, and achieve financial clarity.
For London-based tech founders aiming for sustainable scale, this is the smartest move to grow stronger, faster, and with confidence.
If you're curious about what a part-time flexible CFO in London or full-stack finance team of experts could bring to your business, don't wait any longer, do our assessment or book a meeting with us to explore your options.