You can’t run a business you don’t understand 📊 Lauren Pearl

You can hand finance to someone else, but you still need to understand what the numbers are saying. Otherwise, you can easily make big decisions without seeing what's really happening.

Lauren Pearl learnt that the hard way after a finance-trained classmate diagnosed the family business in minutes. She now advises founders and teaches financial modelling at NYU Stern.

Knowing the numbers later made it harder to ignore the truth when her startup Roost needed to close. This episode shows how models can expose problems before a big decision gets expensive.

What we cover

1️⃣ What you still need to know

Delegating finance doesn’t remove the need to understand it. Lauren explains the numbers founders should know well enough to question decisions and spot when something is off.

2️⃣ Where growth forecasts go wrong

Revenue shouldn’t rise in a model just because you want the business to grow. Lauren shows how forecasts become useful when growth is tied to work the business can actually do.

3️⃣ What hiring really costs you

Salary is only the starting point. Equipment, tax, HR costs and the delay before a new hire generates cash can turn an affordable-looking decision into a much bigger commitment.

4️⃣ The model before the forecast

At the earliest stage, Lauren treats the financial model as a feasibility study. Its first job is to test whether realistic revenue can cover the costs of the business.