Mathieu Translates Entrepreneurs Jargon (or how you can fool yourself 😊) 1. « Our Projections Are Conservative” means 92% of the cases “Our projections are so optimistic we will not reach them”

Mathieu Carenzo
2 min readSep 22, 2022


“Our Projections are conservative” is the phrase I hear from probably 90% of the entrepreneurs that I meet. That’s kind of interesting because there is a strong deviation between how many companies make it big, how many unicorns we see, how many companies can invoice more than 100 or 200 million and the numbers you can see in most of the initial business plans, it is a huge mismatch.

I have been following this for years now this trend through the different BA networks I am involved in and the VC’s I work with …and what you see is on average 92% of those pre-revenue startups don’t reach the revenues they were expecting at the end of year one. We’re not talking about 30% or 40%, we are talking about 92%! So, it’s a thin balance between the necessary optimism of the entrepreneurs and the dream…not to mention reverse financial engineering to cope with the growth investors want to see… to consider investment 😊).

It’s important to be ambitious and to really believe in your idea, but it’s also very important to bring a bit of reality here… And you need to know that investors have several techniques to mitigate that risk.

The first one is a drastic discount rate. 80% discount rate on your revenue projections if it is pre-revenue, and probably around 50% if you have your initial metrics or sales. When you work on calculating the discount rate of your DCF forget your financial accounting courses (inflation, interest rate, etc…). I mean really: forget it.

There’s another technique that we use in the investment community, We take your numbers, divide revenues by two and multiply cost by two, to get a clear vision of what will be the future income of the company.

But you know what:

I do have my secret sauce, which is an additional way to balance my risk. I multiply by two the time you need to generate those revenues.

For example, if you believe you will invoice 100.000€ by the end of January, I will compute 50.000€ by the end of February.

And that’s very important because it gives me the opportunity to have a chat with you on your skills to manage budgets; pivot and adapt to the market. As an entrepreneur if you manage money just based on initial projections, based on assumptions, there is a very high probability that you will end up dying without money before you can raise.


  1. Remember not to be overoptimistic.
  2. Not all startups are potential unicorns.



Mathieu Carenzo

My mission is to empower entrepreneurs by bringing transparency throughout the early stage fundraising process.