Five Cashflow Risks That Catch Leaders Off Guard
Cash is the oxygen of any business; we all know that. But even at exec level, cashflow has a way of tripping up agencies and startups that look solid from the outside.
It’s rarely one big blow that knocks you off course; more often it’s the small, overlooked risks that quietly tighten the runway until big decisions end up being made in panic rather than strategy.
The question isn’t if these risks exist in your business. It's whether you spot them early enough to stay in control.
Here are five I see catch leadership teams most often:
1. Client Concentration
When too much revenue relies on one or two big clients, every late payment becomes a board-level problem. Dependency at that level doesn’t just hit cash, it can stall growth plans overnight.
Bring Calm: Keep an eye on concentration ratios and plan for diversification, even when it feels uncomfortable.
2. When Terms Don’t Match
Suppliers on 30-day terms, clients paying in 90. That gap doesn’t just cause stress - it forces you to fund the shortfall.
Bring Calm: Treat commercial terms as part of strategy, not admin. Good dealmaking is as much about protecting cash as it is about price. And in the UK, this has just gone from operational to political: Labour are cracking down on late payments with new rules for large businesses. Payment terms will be legally capped, boards held accountable, and repeat offenders fined. This isn’t just etiquette anymore, it’s governance under pressure.
3. Growth Ahead of Runway
Hiring and scaling in anticipation of deals that haven’t converted yet is a classic exec trap. The numbers look bullish in the boardroom, but the bank balance tells a different story.
Bring Calm: Test scenarios. Match investments to realised revenue, not just the pipeline optimism.
4. Margin Dilution
Scope creep, aggressive discounting, or sales teams incentivised only on top-line. All of these bleed cash while looking like growth.
Bring Calm: Align incentives with margin and cash efficiency. Otherwise, you’re chasing revenue theatre, not sustainable growth.
5. Governance Gaps
Cashflow too often gets treated as an “ops” issue, until suddenly it’s a board crisis. By then, choices are limited.
Bring Calm: Put cash reporting on the same level as pipeline and EBITDA. Predictable liquidity underpins every other decision you make.
The Bigger Picture
Cashflow discipline isn’t about firefighting invoices; it’s about protecting strategic freedom. The exec teams that get this right buy themselves confidence, optionality, and calm.
