Teardowns
Teardown

The cash you've already earned, sitting on someone else's balance sheet

Collections are ad hoc, DSO is high, and the working capital you're owed is funding your customers instead of your portfolio.

June 15, 2026 · 2 min read

Every operating partner knows the number — days sales outstanding — and most have watched it creep without ever deciding to let it. The cash is earned. The work is done. It's just sitting on someone else's balance sheet, quietly funding your customers' operations instead of your portfolio's.

The obvious move is to push harder: add collectors, tighten the dunning cadence, escalate the aging report. It buys a few days and then drifts back, because effort was never the constraint.

The pattern underneath

Collections isn't an effort problem; it's a prioritization one. A finite team is chasing a long list in roughly the order the report prints it — not in the order of which account is most likely to pay, most worth the call, or most about to tip from late to lost. They work hard on the wrong list. Worse, the list itself is suspect: when the ledger is dirty — misapplied payments, stale credits, disputed lines treated as delinquent — half the chase is spent annoying good customers over money they don't actually owe.

$0.0M
Working capital freed at illustrative scale · DSO 58 → 41
Before
58 days
After the fix
41 days
Days sales outstanding, before and after — illustrative

You can't collect against a ledger you don't trust. Clean the source first — then chase the right account at the right hour.

The fix is a system that does two things the spreadsheet can't: it keeps the ledger honest continuously, so the aging reflects reality, and it sequences the chase by likelihood and value, so the team's hours land where the cash actually is. Same collectors, same week — pointed at the accounts that move the number.

Free the cash that's already yours and you've funded the next operating bet without raising a dollar — the cheapest capital in the portfolio is the capital you already earned.

Rahul Kanda · 24 years in enterprise delivery

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