How To Build A Cashflow Forecast That Actually Works

When founders search for how to forecast cash flow, most guides point them to templated spreadsheets or accounting reports that don’t reflect how their business actually runs.

The truth is: a useful cash flow forecast must be based on drivers - and it only works if your accounting is accurate and up to date.

Here’s how to set up a driver-based forecast that works in the real world - without wasting hours updating formulas.

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Step 1: Get Your Actuals Right First

Cash flow forecasting starts with good inputs. If your accounting data is late, incomplete, or full of errors, your forecast will be off - no matter how pretty the spreadsheet is.

Start by:

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Automating data from Stripe, Shopify, and your bank
Making sure expenses and invoices are correctly coded
Tracking VAT, payroll, and liabilities as soon as they’re triggered

Addition automates this foundation, giving you real-time actuals that make forecasting possible.

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Step 2: Build Around Business Drivers

Forget flat monthly averages. Your forecast should reflect how your business operates. That means using real-world levers like:

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Revenue driven by ad spend, conversion rate, or orders
COGS based on units sold or inventory cycles
Payroll driven by headcount and hiring plans
Overheads and software tied to team size or revenue milestones

These links make your model flexible - not fragile.

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Step 3: Keep It Updated Without the Admin Overload

You don’t need to rebuild your model every week. With clean accounting data feeding in regularly, you can:

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Drop in updated actuals whenever you review your numbers
Spot mismatches between forecast and reality
Tweak key drivers when assumptions shift
Make smarter decisions without starting from scratch

Addition clients use this rhythm to stay in control - even when things move fast.

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Step 4: Use the Model to Make Decisions - Not Just Reports

A forecast isn’t just for your board deck. When it’s working properly, you can:

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Know if you can afford a new hire before you post the job
See how long your cash runway really is
Model the impact of delays, price changes, or growth pushes

It becomes a strategic tool - not just another spreadsheet.

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Real Talk: Forecasting Is Useless Without Clean Data

You don’t need a CFO to run a good cash process - you just need:

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Accurate accounting
A clear model
The discipline to keep it updated

Addition helps you get the first part right - and supports the rest.

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Want a Forecast That Works?

Addition connects your systems, automates your actuals, and supports founder-friendly cash flow forecasting in Excel - built around your business drivers.

✅ Clean, real-time data
✅ Driver-based forecast ready
✅ No finance team required

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→ Explore the platform or book a consult to upgrade your cash flow process.

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