Scenario Analysis & Contingency Planning
Written by Harry Prabandham
Curated by Rubric Financial
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Building Scenario Frameworks
- Define three core scenarios: base case (most likely), upside (things go better than expected), and downside (significant headwinds)
- Each scenario should have internally consistent assumptions: don't just change revenue; adjust CAC, churn, hiring, and timeline accordingly
- Assign rough probabilities to each scenario (e.g., 60% base, 20% upside, 20% downside) to weight expected outcomes
- Include a 'survival' scenario: what happens if revenue drops 50%? This reveals your true minimum viable cost structure
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About the author
Harry PrabandhamFounder & CEO
Founder and CEO of StartupCFO. MBA from Wharton, MS in Computer Science, and decades of experience building and advising venture-backed startups.
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