INTRODUCING CASH OS: A SYSTEM FOR MANAGING CASH & CASH FLOW
Profits aren’t cash. Bank balances are a bad proxy for cash flow. Taxes come every year, so save up for them. Rapid (profitable) growth is often with cash is most scarce.
These are all true, yet most business owners struggle with them.
With the focus on revenue and profits, I often find business owners who have never looked at their Balance Sheet. Not to mention, never even heard of a 13-Week Cash Flow Forecast. In a world that chases revenue goals, both can be unnatural.
But in so many ways, understanding cash and cash flow is actually the foundation of the business.
Imagine your business is like a farm.
On a farm, you have crops to maintain… planting, growing, and harvesting. At the same time, you have the unpredictability of weather.
You, as the farmer, have no control of the weather. But in some ways, the weather defines your success or failure. Whether that rain comes, or the storms miss, determine if the crop grows as intended. This rain, weather, is the cash flow of a business.
The sun predictably comes up and goes down each day. The temperatures, while variable, have some predictability as well. But the storms? You never know. You can’t control the weather, but you can prepare for it. This is just like your cash flows. Some is predictable, but some is not.
So, how do you prepare? You hold cash.
Cash is the rain barrel you install to hold excess rain, so that when the drought comes, you have water to keep your crops alive. Cash, like the rain barrel, is the lifeblood of your business… When the rain barrel dries up, your crops die. When your cash dies up, your business dies.
The water in the rain barrels helps during the times it doesn’t rain, but it also gives you the opportunity level out even the little lulls. And then, when you replant next season, allows you to water on your schedule, not weather’s schedule.
And is where we have capital allocation. This is the strategic use of your cash.
So, to summarize:
- Cash = how much money we have today?
- Cash flow = What’s coming in and going out?
- Capital Allocation = What should we do with the cash we’ve earned?
Over the next several weeks, we’re going to break all this down.
We’re introducing two operating systems:
- CashOS
- CapitalOS
CashOS addresses how we manage our cash flows and CapitalOS addresses how we use and reinvest our cash. There’s a natural flow between the two: managing cash well creates the freedom to allocate cash well. It becomes a feedback loop SMBs can build into how they run their business.
Understanding the difference between these three—cash, cash flow, and capital allocation—is foundational. Confusing them leads to poor decisions, missed opportunities, and sleepless nights.
So, let’s dive in.
CASH OS: KEEP THE BUSINESS BREATHING
CashOS is your system for managing short-term liquidity—the movement and use of money that keeps the business alive day to day.
It helps you:
- Feel confident you won’t run out of cash
- Understand where cash actually goes
- Make proactive decisions about when and how to spend
- Avoid surprises (especially tax, payroll, and large CapEx)
- Use cash as a strategic tool for growth and resilience
Most business owners confuse profit and cash. They look at their P&L and feel great—only to open their bank account and feel panic. Or worse, they manage the entire business off the bank balance and wonder why they’re always stressed.
CashOS replaces that stress with clarity. I plan to teach business owners how to build a system that gives them confidence, clarity, and control over cash.
CAPITAL OS: PUT YOUR CASH TO WORK
CapitalOS takes over once you’ve managed your operating cash well. It’s about long-term decisions—how you deploy your cash to grow, stabilize, or reward yourself.
It helps you:
- Think like a capital allocator, not just an operator
- Choose between reinvestment, debt payoff, and distributions
- Make CapEx decisions with intention, not impulse
- Understand your true free cash flow
- Decide when (and how) to use debt
If CashOS is about survival and rhythm, CapitalOS is about strategy and direction.
They’re two sides of the same system. CashOS protects your business. CapitalOS advances it.
We’ll save outlining that series until we’ve completed the CashOS one, but it’ll build on what we’ve started over the next 6 weeks.
I can’t wait to share this with you.
