POEM ECONOMICS

Tomi Davies (TD)
5 min readApr 12, 2021

--

POEM Framework Economics are the measures of the startups’ use of available capital for funding expenses that generate impact…

How does the startup team plan for the future when there is no certainty in what that future will look like? What methods and tools does it use for cash flow management? How does the startup meet financial challenges and plan for an unpredictable future as economic and business pressures take their toll? How does it advance one or more of the United Nations Sustainable Development Goals (SDGs)?

These are some of the questions considered as part of the economics of any Startup using the POEM Framework.

Capital — Equity, Grants, Prizes, Cash…

The economic journey of a start-up begins with capital both human and financial. Financial capital is what the founders raise to pay for any or all of the required expenses involved in creating their new business. The first capital to come into the company is typically the founder’s human capital which is often accompanied by financial capital in the form of cash, grants and sometimes loans. Family, Friends, Fans (and some say Fools) aka FFF usually contribute the first capital raised by the startup in the form of cash and/or time spent as “Sweat Equity” becoming the first shareholders aside from the founders. In addition to the cash and loans from FFF…

--

--

Tomi Davies (TD)

Speaker, Author, Advisor, Angel and Advocate of Technology-led Innovation and Entrepreneurship in Africa