Financial Modeling for Entrepreneurs: Agile Financial Modeling


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To provide the framework to build a great financial model efficiently through agile principles.

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Financial Modeling for Entrepreneurs: Agile Financial Modeling

  1. 1. Course Objective To provide the framework to build a great financial model efficiently through agile principles.
  2. 2. Key Learning Outcomes ● Tactics to make a proforma quickly/ efficiently ● Get to market quickly ● What makes a great proforma ● How to get feedback to improve the proforma ● Listen, Learn, Iterate & Pivot!
  3. 3. What does an investor want to see? ● Business Drivers ● Revenue ● Variable Expenses ● Fixed Expenses ● Cash Flow Breakeven ● Reasonable assumptions ● Ability to convey your business ● A summary sheet
  4. 4. Same: ● Math works ● Consistent layout Agile: ● Focus is on assumptions ● How much customer acquisition costs ● Monthly cash burn rate ● No balance sheet or financial statements aside from cash accounting numbers ● Simple to iterate Traditional: ● Multiple scenarios are included along with detailed analysis ● Breakout of detailed cost analysis ● Full financial statements including balance sheet ● Stays constant
  5. 5. Agile Financial Modeling Leveraging the Lean Startup and Agile Development principles Convey information to an influencer or investor--no different than a pitch deck Not an excuse not to have done your "homework".
  6. 6. An Agile Financial Model is: ● Juice ● Communication ● Focused ● Mathematically works
  7. 7. An Agile Financial Model is not: ● Sloppy ● Incomplete thoughts ● Heavy in narrative ● Loaded with details
  8. 8. Creating the Proforma ● Excel vs. Google Spreadsheets ● Input Page vs. Hard Coded Numbers ● Consistency ● Time Periods ● Business Drivers ● The Numbers ● Summary Section
  9. 9. Why Use Agile Modeling ● Quicker ● Better ● Simpler ● Multi-purpose ● More Engaging
  10. 10. Who Can Use Agile Modeling Most business Great for having a conversation Not great for businesses that are going to have another entity put the business owners financial information into another model
  11. 11. What are you trying to convey to your audience? ● How does your business work and what are the key drivers ● What needs to happen for the investor to get their money back ● Is there another round of financing ProTip: It isn't you are going to get stupid rich
  12. 12. Getting Feedback 1. Your DealTeam 2. Your Advisory Board 3. Trusted advisors with the right background 4. Influencers/ Peers 5. Investors
  13. 13. Learn and Iterate ● Ask a reviewer to validate another reviewer's concerns ● If you receive consistent feedback incorporate it ● Give the most credence to those that can write checks ● Beware of chasing and incorporating every suggestion
  14. 14. Proforma or Pitch Deck First? Financial Highlights are usually part of a Pitch Deck How do YOU think more clearly? What better conveys your business? Use the proforma to tell a story
  15. 15. Signs of a Great Proforma Discussion is about the business opportunity and how it is conveyed in numbers Reviewer feels like they understand how cash goes into and out of business Entrepreneur is asking questions and reviewer is validating their assumptions
  16. 16. Next Steps ● Join our Master Fundraising Course ● Join us now for 50% off ● "FAN" ● Feedback: Jason (at)