Business start-ups mean the world to the business owner who has decided to chase their dream by starting a business. There is always fear and risk though, since he/she does not know if their idea will be a hit or a bust. Many times the entrepreneur will pitch the idea to the investment world but failure rates are very high due to poor assumptions in the financial projections or weak financial management. It is critical to understand how financial projections or management are essential for a business start-up.

Business owners are not the only ones affected when plans do not turn out as planned. Business failures also impact the friends, family and early investors who believed in the initial concept. In addition, each company has an ecosystem of customers, vendors and employees that depend on the careful execution of each businesses’ financial plans.

While there is much for a starting business owner to consider, few things are more critical that a solid financial plan and financial projections. The entrepreneur must remember that: