Your fundraising target should explain what the company will achieve and what cash that work requires. Start with the next meaningful business milestone, build the operating plan behind it and compare several scenarios. A fashionable round size is not a financing strategy.
This worksheet helps you calculate a planning range from your own assumptions. It does not predict what investors will offer, determine a valuation or recommend a financing instrument. For the wider process, start with the pre-seed or seed fundraising guide.
Start with the milestone, not the headline number
Write a concrete sentence: “This capital would let us complete [work], producing [evidence], by [planning checkpoint].” A milestone might be a completed technical demonstration, a defined commercial rollout or evidence of repeatable customer adoption. The right milestone depends on the company.
Y Combinator’s seed-fundraising guide makes the enduring point that the amount should connect to a believable plan, with alternatives for different capital outcomes. Use current company costs, not the guide’s historical spending examples, as your inputs.
For every proposed expense, ask which milestone it supports, when the cash leaves the bank and what would change if you delayed it. This turns “we need to hire” into a delivery assumption that can be discussed.
Calculate the financing gap
Planning financing gap =
forecast net operating cash outflow over the planning period
+ one-off cash requirements not already included
+ desired minimum closing cash reserve
- available unrestricted cash at the start
- other separately committed financing not already included
Use zero as the additional-equity requirement if the result is negative,
but retain the underlying cash forecast and financing alternatives.Net operating cash outflow means cash payments less cash collections. It is not the same as accounting loss, booked revenue or the value of a sales pipeline. Do not count expected investment, an unsigned customer deal or restricted money as available operating cash.
Use a monthly forecast for the real decision. The simplified average-burn examples below explain the arithmetic but cannot show a cash shortfall that happens before financing arrives.
Compare three capital plans
Here is a fictional company with $400,000 of available cash. All periods begin at the same planning date. Net outflow already includes each scenario’s assumed operating collections. One-off costs are additional, and no other financing is included.
| Illustrative plan | Period and monthly net outflow | Additional one-off costs | Minimum ending cash | Planning gap |
|---|---|---|---|---|
| Lean: a narrower pilot programme | 12 months × $80,000 = $960,000 | $150,000 | $100,000 | $810,000 |
| Base: a broader deployment plan | 16 months × $100,000 = $1,600,000 | $200,000 | $100,000 | $1,500,000 |
| Expanded: additional market and team | 18 months × $140,000 = $2,520,000 | $300,000 | $150,000 | $2,570,000 |
The base arithmetic is $1.6 million + $200,000 + $100,000 − $400,000 = $1.5 million. These are invented planning inputs, not funding benchmarks or recommended targets. The three plans purchase different scopes of work; the lean plan does not magically deliver everything in the expanded plan.
Now challenge the timing. Could cash fall below the required floor before the assumed close? Which costs are already contractually committed? Does a slower collection schedule increase the gap? Record the answer month by month before using the headline number in a pitch.
Test the assumptions that change the target
| Assumption | Question to test | Planning response |
|---|---|---|
| Customer collections | Are these signed obligations, reasonable scenarios or speculative pipeline? | Separate them and build a slower-collection case |
| Hiring | When does each role become necessary for the milestone? | Show start dates and full cash costs |
| Technical delivery | What dependency could delay the proof point? | Model the extra work and time rather than hiding it in a percentage |
| One-off payments | Are equipment, deposits and transaction costs counted once? | Assign a month and avoid double-counting |
| Available cash | Is any cash restricted or needed for unavoidable obligations? | Reconcile the opening balance to actual records |
| Financing timing | What happens if the close is later or smaller? | Identify an earlier decision checkpoint and a feasible alternative plan |
How much money does the average startup raise?
There is no single average that should determine your company’s target. A financing dataset combines companies with different stages, sectors, geographies and capital needs. Its median or average also describes a particular observation period, not an amount available to your startup.
Use a relevant benchmark as a reason to investigate a difference, not as permission to skip your model. If your target is much larger than comparable rounds, explain the work it funds and whether your evidence supports that scope. If it is smaller, explain what you can accomplish and what remains unfunded.
Your round-size worksheet
| Field | Your entry |
|---|---|
| Planning date and period | [Start date, monthly model and review checkpoint] |
| Milestone and evidence | [What will be completed and how you will know] |
| Opening available cash | [Amount, source and restrictions] |
| Monthly payments and collections | [Base, downside and alternate-scope cases] |
| Additional one-off cash needs | [Amount and timing, counted once] |
| Minimum cash reserve | [Your chosen assumption and reason] |
| Financing gap and timing | [Scenario result and any earlier cash constraint] |
| What changes with less capital | [Scope, milestone and decision owner] |
Turn the model into a clear ask
Explain the target in one sentence, then show the assumptions behind it: “We are planning to raise [amount] to reach [milestone], based on [period and major resource assumptions]. If the financing differs, our alternative plan is [specific scope].” Keep that sentence consistent with the deck, model and investor conversations.
Bring the approved plan, documents and next actions into Finta. Aurora can help review the consistency of the material you provide; the company and its advisors still make the financing decisions.
Review these startup round-size scenarios.
Milestones, monthly cash forecast and opening cash: [paste]
Base, downside and alternative-scope assumptions: [paste]
Check arithmetic, timing, double-counted cash and unsupported collections.
Separate a financing gap from an investor commitment.
Explain what each scenario can fund and what remains unfunded.
Draft a concise use-of-capital explanation with open questions for review.
Do not invent costs, recommend financing terms or present assumptions as results.Continue with the cash-runway lesson and fundraising operating plan. This worksheet is general education, not individual financial, investment, legal or tax advice.
By Finta Editorial Team. Research reviewed November 12, 2026.