Your financial model is only as good as the assumptions behind it. Get them right and you have a tool for making decisions. Get them wrong and you have a spreadsheet full of fiction.

After watching hundreds of startup models, the same five assumptions trip up founders over and over. Here’s what they are, why they matter, and how to get them closer to reality.

1. Fully-loaded cost per employee

Most founders model headcount using base salary alone. That’s a problem. Salary is typically only 60-70% of what an employee actually costs you.

Take a senior engineer at $150K base. Once you add health insurance ($7K-$12K/year), payroll taxes (roughly 8-10% depending on state), equipment ($3K-$5K for laptop and peripherals), and software licenses ($2K-$4K/year), the fully-loaded cost (the total cost including all benefits, taxes, and overhead) is closer to $185K-$195K. That’s a 25-30% difference.

Multiply that gap across a team of 10 and you’re underestimating expenses by $300K-$400K per year. That turns 18 months of runway into 14.

When you set up employees in Burncast, you can specify the fully-loaded cost separately from salary. That way your projections reflect what you’ll actually spend, not just what shows up on an offer letter.

2. Revenue growth rate

The temptation is to model aggressive growth because it makes the model look good. Don’t do that. Model what you can defend.

If you’re at $10K MRR (monthly recurring revenue) and growing 15% month-over-month, that math puts you at $41K MRR in a year. That’s $490K ARR. Sounds reasonable. But sustaining 15% MoM means you need to add $1,500 in new MRR in month one, and $5,300 in new MRR by month twelve. Where is that coming from? Do you have the pipeline? The sales capacity?

A better approach: model two growth curves. One that reflects your current trajectory, and one that shows what happens if growth slows to 8-10% MoM after month six. The second scenario is more likely, and having it ready shows investors you’ve thought about it.

In Burncast, you can create a scenario for each growth assumption and compare them side by side. Change the revenue growth rate in one scenario and every downstream number — burn rate, runway, profitability date — updates automatically.

3. Months to close enterprise deals

If you’re selling to companies with more than 50 employees, your sales cycle is longer than you think. Most founders estimate 30-60 days. The reality for a first contract with an enterprise buyer is usually 90-180 days.

Here’s a concrete example. You sign a verbal commitment from a VP of Engineering in March. Legal review takes three weeks. Procurement needs a security questionnaire — that’s another two weeks. Then it lands in the April budget cycle and gets pushed to May. The PO arrives in June. First payment hits your bank in July. That’s four months from handshake to cash, and this is a fast scenario.

If your financial model assumes enterprise revenue starting in Q2, but the deals don’t actually close until Q3 or Q4, your cash position in the interim is materially different. You might need to bridge that gap with existing runway — or a smaller funding round you hadn’t planned for.

Model the sales cycle explicitly. If you think it’s 60 days, assume 120 and hope to be pleasantly surprised.

4. Burn rate trajectory

Founders often model burn rate as roughly flat, then make a mental note that “we’ll hire later.” But hiring has a compounding effect on burn.

Say you’re at $80K/month burn with a team of 5. You plan to hire 3 people in Q2 and 4 more in Q3. Those 7 new hires at an average fully-loaded cost of $170K each add roughly $100K/month to your burn by the time they’re all on board. Your monthly burn nearly doubles from $80K to $180K in six months.

That trajectory matters for runway calculations. If you raised $2M and assumed a steady $80K burn, you’d model 25 months of runway. With the actual hiring plan, runway drops to about 14 months. That’s the difference between “comfortable” and “need to start fundraising immediately.”

Burncast models this automatically. Enter your hiring timeline — when each role starts, what it costs — and your burn rate projections reflect the actual ramp, not a flat line.

5. Fundraising timeline

Most founders plan to fundraise “in Q3” as if it’s a two-week task. It isn’t.

From the decision to raise to money in the bank, expect 4-6 months. That breaks down roughly as: 2-4 weeks to prepare materials, 6-8 weeks of active meetings and pitches, 2-4 weeks of due diligence and term sheet negotiation, and 2-4 weeks for legal and wire. If you’re a first-time founder or raising in a slow market, add another month.

The practical impact: if you have 12 months of runway and start fundraising at month 8, you’re cutting it dangerously close. Start at month 6 and you have a reasonable buffer. Start at month 4 and you’re negotiating from strength.

Build the fundraising timeline into your model. Set the expected close date for your funding round 5 months out from when you plan to start, and make sure your runway extends at least 2-3 months beyond that. If it doesn’t, you need to either raise earlier or cut burn.

The common thread

All five of these assumptions share a pattern: founders default to optimistic. Faster hiring than realistic costs suggest. Higher growth than pipeline supports. Shorter sales cycles, flatter burn, quicker fundraising.

The fix isn’t pessimism — it’s scenario modeling. Build your base case with honest estimates, then create a conservative scenario where each assumption is 20-30% worse. If the conservative scenario still works, your plan is solid. If it breaks, you know exactly which assumption to watch.

In Burncast, each scenario only stores the assumptions you changed. You can test one variable at a time — what if hiring is slower? What if the enterprise deal slips a quarter? — and see the downstream impact across your projections, runway, and financial statements without rebuilding anything.

The assumptions are the model. Everything else is just math.