Entrepreneurs are wired for growth. The pursuit of a bigger vision is what pushes us forward. Yet, growth doesn’t always feel like success. In the midst of scaling up, too many business owners find their plans outpacing their cash flow. This is when growth starts to feel like a high-wire balancing act between opportunity and survival.
As you scale, so do your responsibilities—larger payroll, rising expenses, more decisions, and a heftier workload. Running the business can quickly become a scramble to keep the lights on with almost no cash runway.
This is the growth trap: revenue climbs, but cash flow falters. It’s a scenario playing out for more than half of businesses these days. Our annual Cash Flow Compass report shows that while 94% of small and midsize businesses expected growth in the past year, 54% have less than 31 days of cash on hand.
Growth is only as strong as the systems supporting it. So, let’s dig into how runway, forecasting, and cash flow management make or break expansion. We’ll also cover what happens when growth outpaces your systems, and how to build a foundation that helps your business scale with confidence instead of stress.
Small business growth expectations are sky-high
Amid economic uncertainty, small businesses haven't just remained resilient—they’ve made it work and aren’t slowing down. Our report found that in addition to the 94% of businesses expecting growth this year, nearly one in three are aiming for revenue gains of 20% or more. These aren’t predictions based on sheer optimism. Rather, the numbers reflect real shifts already happening.
Consumer spending is rebounding
People are finally spending more after years of pulling back due to inflation, higher interest rates, and rising living costs. Nielsen IQ reports that 30% of global consumers say they’re in a better financial position than they were a year ago, and that change is showing up in everyday purchasing behavior. Spending is no longer limited to essentials. Buyers are resuming delayed purchases, re-engaging with businesses, and moving forward on decisions they’d been putting off.
Digital-first expectations are rewriting buying behavior
Customer behavior has permanently changed. Whether someone is shopping for home essentials, business tools, or services, they expect speed, ease, and flexibility. That includes seamless online experiences, fast turnaround times, and reliable service. Businesses that can meet these expectations are starting to see fuller pipelines and stronger recurring revenue.
Growth arrives fast, but cash follows slowly
When demand increases, small businesses do what they do best: move fast. They upgrade software, restock inventory, hire help, and launch new offers. On the surface, these investments make it appear that momentum is building—and it is—but growth often arrives before cash does. Expenses rise immediately while revenue lags. Customers delay payments, margins tighten, and growth starts to feel less like progress and more like risk.
Most businesses don’t have enough cash runway
How many small businesses are already facing these risks? Our report shows that 54% of small and midsize businesses have less than 31 days of cash on hand—meaning more than half are one slow month or one delayed payment away from a cash crunch. This isn’t due to a lack of demand or discipline, but because growth increases the need for cash before revenue catches up.
A lack of cash runway doesn’t just slow momentum. It changes how a business operates. It forces short-term decisions, delays opportunities, and creates stress that compounds month after month. And in the worst cases, it can end promising companies before they scale. The U.S. Chamber of Commerce found that running out of cash is the number one reason small and midsize businesses fail.
Cash flow runway is what keeps a business stable when timing turns against you. Payroll still has to land every two weeks and operating costs don’t pause just because revenue does. When something unexpected happens—a delayed customer payment, a broken piece of equipment, or a sudden tax bill—runway is the only thing that prevents a temporary setback from becoming a crisis.
Why growth is outpacing cash flow systems
If growth were as simple as selling more, most businesses would scale smoothly. But that’s not how it works in reality. Growth multiplies moving parts—more invoices, tools, payroll cycles, tax complexity, and places for cash to get stuck. And the truth is, most businesses don’t have the systems in place to keep up with that complexity.
Only 31% of small and midsize businesses actively optimize their cash flow, according to our data. The rest are stuck reacting—moving money around week to week, covering expenses as they come, and checking the bank balance to make decisions.
That may work in the early stages of a business, but not once things scale. By then, most founders are already used to relying on instinct instead of planning. Teams get hired faster than the business can fund them, revenue goals are chased without considering when the money will actually land in the bank, and decisions are made with no forward-looking filter applied.
The real cost of running on empty
What are the risks to small and midsize businesses when they put off implementing systems to manage growth? Our report found that 88% of businesses were hit with unexpected cash flow issues in the past year, and most weren’t prepared. These weren’t small bumps—they caused delayed payroll, supplier tension, higher interest costs, and emergency borrowing just to stay running.
The long-term cost is even higher: 76% of business owners said cash flow challenges held them back from growth, and 29% missed three or more major opportunities because they didn’t have the cash available to act.
It’s no wonder so many founders say growth starts to feel less like forward motion and more like running on a treadmill—working harder than ever, but getting nowhere. And without a system built for control, growth becomes something you survive, not something you scale.
How businesses can build systems that support growth
Here’s the good news: this doesn’t have to be a permanent problem. Cash strain isn’t a failure—it’s a systems gap. Progress starts with visibility. First, get a clear view of cash movement: what’s earned, what’s committed, and what’s actually available. With that clarity, planning stops being guesswork and timing risks are easier to spot.
Next, remember that momentum comes from structure. When money is intentionally set aside for payroll, taxes, operating expenses, and growth, pressure loosens. Big expenses stop being surprises. Hiring becomes strategic. Opportunities become easier to act on.
Growth also requires control without complexity. Systems should remove anxiety—not add more spreadsheets. That’s where tools like Relay help businesses stay steady while they scale by showing exactly how much money is safe to use, separating funds by purpose, and automating how income gets distributed.
If you’re curious about what else should be top of mind when you’re growing, our report shares real stories, data, and lessons from entrepreneurs who went from running on empty to scaling with confidence. Read the full Cash Flow Compass report.
Relay is a financial technology company and is not an FDIC-insured bank. Banking services provided by Thread Bank, Member FDIC. FDIC deposit insurance covers the failure of an insured bank.
