How Long Will Your Cash Last? Start-Ups Too Casual

Entrepreneurs are not worried enough about herding their start-ups through a rough patch, Rafe Needleman, CNET News writer says. A recent survey of 491 respondents found that 30 percent reported having two or more years of money in the bank, or are cash-flow positive.

About 21 percent say they have a year's worth of cash set aside.

About 49 percent reported having only three or six months of cash. That suggests as many as 50 percent of firms will be in serious trouble if an economic slowdown lasts more than a year.

Also, only 33 percent of the 524 respondents say they are "worrying about revenue and payroll."

Granted, the slowdown does not to some of us appear to be a "nuclear winter," though one could get a huge argument going on that score. Still, when young companies cannot raise the next round of funding, they die. Hence the importance of cash on hand.