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When I ran growth at The Motley Fool, I could build a plan for the year and feel about 80% confident in it. We had years of data. I knew roughly what a campaign would do — within reason — and how refunds, renewals, etc., would all impact cash.

So I could plan, allocate capital, and hire ahead of the revenue and, mostly, I’d sleep well.

As CEO of Hampton (a startup), however, that went out the window. We were less than a few months old, and revenue was lumpy as hell month to month.

And since we were bootstrapped, we made our bets smaller.

For example, when we decided podcasts would be a priority acquisition channel for finding new members, we didn’t place one monster bet. We scooped up some ad inventory on a few shows in similar markets, and we started our own podcast, MoneyWise. Our cofounder hosted it, so the only real cost — besides opportunity — was editing and production.

Every one of those bets could be ramped up, or turned off, within a month.

That’s the lesson I’d give most founders heading into planning season: the less history you have, the smaller your bets should be, so they’re easy to unwind.

Unless you’re insanely confident, or you’re sitting on a sh*t ton of venture capital and your whole mission is to make ginormous bets. In which case, godspeed.

And that’s what part two of this planning series is all about. Last week, you (hopefully) picked your “this vs. that” bets. This week, we size them, because how big each bet is matters as much as what you picked.

And the simple math of it all is that if you’re making five bets this year, one or two of them are going to miss. So what you have to do is prepare for that now, while you’re calm and in planning season, versus doing it in July when you’re panicking because some initiative just bombed.

Last year I walked through my budgeting process: start with where you are today, then drag the spready.

If you just keep doing what you’re doing, where do you end up? That’s your run rate.

Then pick the number that would actually get you and the team fired up — that’s your stretch goal.

Say you’re at $1M today, with a $1.5M run rate and a $3M stretch.

Budget your fixed costs to the run rate, not the stretch. Full-time salaries, long contracts, the office: all of it should survive a year where none of your new bets work.

Everything between $1.5M and $3M gets funded by milestones.

And if you want to get a little more sophisticated, add a third number: a down year. What happens if a big customer churns, a channel dries up, or the market gets weird and you land below your run rate? You don’t build the plan around that number, but you should know what you’d cut, and in what order, if you start trending toward it.

A stretch goal is just a number on a slide unless something tells you how close you’re actually getting to that mile marker.

That’s the job of a milestone — it’s a specific, measurable condition that unlocks spend or, on the contrary, kills it:

Jim Collins of Good to Great fame calls this “fire bullets, then cannonballs.” In Great by Choice, he and Morten Hansen found the best companies ran low-cost, low-risk tests first, then went big only on what worked. As Collins put it, “The greatest companies did big, big bets.” They just earned them a little bit first.

So run your H1 experiments the MoneyWise way: contractors, agencies, part-timers, things you can shut off in a month. Then let your milestones decide which ones earn a full-time hire in H2.

Without them, every experiment quietly becomes permanent because nobody wants to have the awkward conversation, or you fall prey to sunk cost fallacy, which many of us do.

One more rule: sometimes wins take 3 to 6 months to show up in the numbers, so set your milestone dates with that lag in mind.

My Founder Annual Planning Template has everything from this series in one place: a run rate model, a forecast model, OKRs with an owner on every line, and a quarterly tracker. Includes a video walk-through from yours truly. Grab a free copy here, make it your own, and go drag the spready.

First Round got a CPO, CRO, CFO, and COO from Linktree, Vanta, Notion, and Linear to break down how they actually plan. My favorite bit is Vanta CRO Stevie Case’s guardrails: targets stay fixed, but preset triggers tell you when to deviate (two months above 100% attainment means add capacity). It’s milestones, just with a fancier name.

Khosla Ventures has a short if/then planning playbook for its portfolio companies, and it’s basically this week’s Signal on one page. Build base, downside, and survival cash plans, tie each one to specific triggers, and do it “while your outlook is positive.” It’s written for venture-backed companies, but the down-year exercise works for anyone.

Over a decade ago, my old CEO made our whole exec team read Peter Sims’ Little Bets, and it turned into a bit of a running joke because someone was always saying “it’s just a lil’ bet.” Still, it’s a great book, and the crux of it basically says: run cheap experiments to figure out what actually deserves a big swing. Worth a read before you lock in next year’s plan.

Real question for you: if Q1 goes sideways, which bet in next year’s plan gets cut first?

If you can’t answer that in about five seconds, that’s your homework this week.

—> Hit reply and tell me. I read every single reply.

—> Or pass this to a founder who’s about to budget for their best year.

Hope everyone has a great weekend.

And until next time, thanks for reading.

Jordan