Contract Loops
Exploring different billing models, and what each one quietly does to the balance sheet.
Three contracts. Each worth €100,000. Each recognizes exactly €100,000 by year end. Their balance sheets look nothing alike.
Sequoia's argument this spring was that the next trillion-dollar company sells the work, not the tool: six dollars of services spend for every dollar of software. It's a good argument. It just doesn't say what selling the work does to your revenue.
So I drew it.
Fixed price, billed quarterly in advance. You're holding cash you haven't earned. That's deferred revenue, a liability, and it clears to zero four times a year.
Usage, billed monthly in arrears. The exact opposite. You've earned money you haven't invoiced, so it sits as a contract asset, and it never fully closes, because December's revenue is January's invoice.
Outcome-based, the one everyone is moving toward. Nothing for eleven months, then the whole fee in a single period. Under IFRS 15 you constrain variable consideration until a significant reversal isn't probable, so your best commercial quarter can book zero.
Charge for time and it's a straight line. Charge for results and there's nothing to book until it works.
The bit I enjoyed
Every cell is exactly 31px, and the column padding is 26 rather than a rounder 28; it's the only value where a 4×3 nested grid lands on whole pixels. At 28 the cells came out 30.66 and the quarter boundaries rasterized unevenly enough to see.
The rest is CSS grid and transforms. No chart library, no SVG, nothing animated except transform and opacity.
