I have never seen an entrepreneur (including myself) estimate cash required for a venture accurately from the first business plan.

The inherent optimism of starting a business seems to guarantee that cash needs will be underestimated.

The problem is that underestimating cash needs creates cash flow problems somewhere down the line.

Since entrepreneurs always underestimate cash needs, the search for money needs to be consistent and continuous. However, it is always wise to take the money you think you need and double it.

Also, it’s a good idea to have a talented CFO on your management team to be able to conservatively determine cash needs.

I cannot overemphasize the need to overshoot your cash need projections.

If you don’t, you are guaranteed to undershoot them.  

Even if you are being conservative, you still need to constantly look for more money. Since you will always need more cash, it’s important that you never stop looking for it.