August 22, 2025
August 22, 2025
Burn is borrowed urgency
Burn rate is a risk lever. Treat it as such. With intent and conviction.
pascal's notes
Burn is borrowed urgency. Decide how much pressure you can thrive under.
2021 made overspend look heroic. 2025 punishes it - unless you’re in a hot AI space.
Yet, the trade‑off never changed:
High burn buys acceleration but hard‑codes urgency. Miss even one quarter and the cash curve cliffs.
Low burn extends time but taxes ambition; hotter competitors will pass unless your product compounds faster than their headcount.
The answer depends on the risk appetite. Burn is borrowed urgency.
How much urgency can you live under?
The higher the burn, the faster you have to make progress. If you’re confident, you can hit ambitious milestones, go for it. And revisit every 90 days (hello burn multiple).
If growth slows, cut spend before spend cuts you.
Accelerating feels uncomfortable. Cuts are hard.
Maintaining the status quo is easiest. Yet, it’s often the wrong answer.
Risk is a lever. Treat it as such. With intent and conviction.
Enjoyed reading this?
Then check out my conversation on the focal podcast with Duncan Weatherston, Co-Founder and CEO of Smile Digital Health - a business that bootstrapped to $10M ARR and has >$50M ARR with $50M raised today.
Youtube | Apple Podcast | Spotify
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