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Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
Swifton - The Capital Network - Financial Projections
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Swifton - The Capital Network - Financial Projections

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August 2011 presentation at The Capital Network on how to present financial projections for investors

August 2011 presentation at The Capital Network on how to present financial projections for investors

Published in: Economy & Finance, Business
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  • 1. AB C Company, Inc.Es timate d State me nt of Ope rationsFor The Years Ended December 31, 2010. 2011, 2012, and 2013 Dollars (000s omitte d) Pe rce nt (%) of Re ve nue 2010 2011 2012 2013 2010 2011 2012 2013Re ve nue : Installation Revenue $ 450 $ 3,825 $ 21,038 $ 73,633 77.1% 84.3% 82.3% 80.6% Non-Installation Revenue Service Fees $ 89 $ 623 $ 4,361 $ 17,444 15.2% 13.7% 17.1% 19.1% Other Non-Installation Revenue $ 45 $ 90 $ 158 $ 237 7.7% 2.0% 0.6% 0.3% Total Revenue: $ 584 $ 4,538 $ 25,557 $ 91,314 100.0% 100.0% 100.0% 100.0%Dire ct Cos ts: Installation Costs $ 338 $ 2,678 $ 12,623 $ 36,817 57.9% 59.0% 49.4% 40.3% Non-Installation Costs $ 38 $ 193 $ 1,175 $ 4,420 6.5% 4.3% 4.6% 4.8% Direct Costs: $ 376 $ 2,871 $ 13,798 $ 41,237 64.4% 63.3% 54.0% 45.2%Othe r Cos t of Se rvice s $ 88 $ 567 $ 2,556 $ 6,849 15.1% 12.5% 10.0% 7.5%Gros s M argin ($) $ 120 $ 1,100 $ 9,203 $ 43,228 20.5% 24.2% 36.0% 47.3%Gross Margin (%) 20.5% 24.2% 36.0% 47.3%Ope rating Expe nse s: Sales $ 292 $ 1,588 $ 6,389 $ 18,263 50.0% 35.0% 25.0% 20.0% Marketing $ 263 $ 1,361 $ 5,111 $ 13,697 45.0% 30.0% 20.0% 15.0% Research & Development $ 175 $ 998 $ 2,811 $ 8,218 30.0% 22.0% 11.0% 9.0% General & Administration $ 44 $ 295 $ 1,533 $ 4,566 7.5% 6.5% 6.0% 5.0% Total Operating Expenses: $ 774 $ 4,242 $ 15,844 $ 44,744 132.5% 93.5% 62.0% 49.0%EBITDA $ (654) $ (3,142) $ (6,641) $ (1,516) -112.0% -69.2% -26.0% -1.7%Othe r (Re ve nue ) & Expe ns e s : Interest $ 80 $ 156 $ 32 $ 80 13.7% 3.4% 0.1% 0.1% Taxes $ 8 $ 9 $ 11 $ 15 1.4% 0.2% 0.0% 0.0% Depreciation & Amortization $ 13 $ 67 $ 268 $ 874 2.2% 1.5% 1.0% 1.0% Total Other (Revenue) & Expenses $ 101 $ 232 $ 311 $ 969 17.3% 5.1% 1.2% 1.1%Ne t Income (Loss ) $ (755) $ (3,374) $ (6,952) $ (2,485) -129.3% -74.3% -27.2% -2.7%State me nt Note s :Re ve nue Market 1 $ 43 $ 2,320 $ 12,205 $ 46,232 7.4% 51.1% 47.8% 50.6% Market 2 $ 230 $ 1,201 $ 7,652 $ 26,450 39.4% 26.5% 29.9% 29.0% Market 3 $ 256 $ 932 $ 3,250 $ 12,658 43.8% 20.5% 12.7% 13.9% Market 4 $ 55 $ 85 $ 2,450 $ 5,974 9.4% 1.9% 9.6% 6.5%Total Re ve nue $ 584 $ 4,538 $ 25,557 $ 91,314He adcountExisting $ 13.00 $ 18.00 $ 61.00 $ 298.00New Hires $ 5.00 $ 43.00 $ 237.00 $ 830.00Total Headcount $ 18.00 $ 61.00 $ 298.00 $ 1,128.00Capital Expe nditure s $ 126.00 $ 424.00 $ 1,584.00 $ 4,474.00 COPYRIGHT © 2010 COPYRIGHT © 2011
  • 2. Rule #1: If you cannot read thefinancial statement from two feet away the font is too small(i.e. there are too many details) COPYRIGHT © 2011
  • 3. ABC Company, Inc.Projected Statement of OperationsFor The Years Ended December 31, 2010. 2011, 2012, and 2013 Dollars (000s omitted) 2010 2011 2012 2013Revenue: Market 1 $ 43.00 $ 2,320.00 $ 12,205.00 $ 46,232.00 Market 2 $ 230.00 $ 1,201.00 $ 7,652.00 $ 26,450.00 Market 3 $ 256.00 $ 932.00 $ 3,250.00 $ 12,658.00 Market 4 $ 55.00 $ 85.00 $ 2,450.00 $ 5,974.00Total Revenue $ 584.00 $ 4,538.00 $ 25,557.00 $ 91,314.00Gross Margin ($) $ 120.00 $ 1,100.00 $ 9,203.00 $ 43,228.00Gross Margin (%) 20.5% 24.2% 36.0% 47.3%Operating Expenses: Sales & Marketing $ 555.00 $ 2,949.00 $ 11,500.00 $ 31,960.00 Research & Development $ 175.00 $ 998.00 $ 2,811.00 $ 8,218.00 General & Administration $ 44.00 $ 295.00 $ 1,533.00 $ 4,566.00 Total Operating Expenses: $ 774.00 $ 4,242.00 $ 15,844.00 $ 44,744.00Other Expense/(Income) $ 101.00 $ 232.00 $ 311.00 $ 969.00Net Income (Loss) $ (755.00) $ (3,374.00) $ (6,952.00) $ (2,485.00)Stateme nt Notes:HeadcountExisting $ 13.00 $ 18.00 $ 61.00 $ 298.00New Hires $ 5.00 $ 43.00 $ 237.00 $ 830.00Total Headcount $ 18.00 $ 61.00 $ 298.00 $ 1,128.00Capital Expenditures $ 126.00 $ 424.00 $ 1,584.00 $ 4,474.00 COPYRIGHT © 2011
  • 4. Rule #2:Pennies are only foraccounting auditors COPYRIGHT © 2011
  • 5. “Before you can sprint you must learn how to crawl” Usain Bolt (Olympic Gold Medalist 100 meters) COPYRIGHT © 2011
  • 6. ABC Company, Inc.Estimate d State ment of OperationsFor The Years Ended December 31, 2010. 2011, 2012, and 2013 Dollars (000s omitte d) 2010 2011 2012 2013Revenue: Market 1 $ 43 $ 2,320 $ 12,205 $ 46,232 Market 2 $ 230 $ 1,201 $ 7,652 $ 26,450 Market 3 $ 256 $ 932 $ 3,250 $ 12,658 Market 4 $ 55 $ 85 $ 2,450 $ 5,974Total Reve nue $ 584 $ 4,538 $ 25,557 $ 91,314Gross Margin ($) $ 120 $ 1,100 $ 9,203 $ 43,228Gross Margin (%) 20.5% 24.2% 36.0% 47.3%Ope rating Expense s: Sales & Marketing $ 555 $ 2,949 $ 11,500 $ 31,960 Research & Development $ 175 $ 998 $ 2,811 $ 8,218 General & Administration $ 44 $ 295 $ 1,533 $ 4,566 Total Operating Expenses: $ 774 $ 4,242 $ 15,844 $ 44,744Other Expense/(Income) $ 101 $ 232 $ 311 $ 969Net Income (Loss) $ (755) $ (3,374) $ (6,952) $ (2,485)Statement Notes:HeadcountExisting $ 13 $ 18 $ 61 $ 298New Hires $ 5 $ 43 $ 237 $ 830Total Headcount $ 18 $ 61 $ 298 $ 1,128Capital Expe nditure s $ 126 $ 424 $ 1,584 $ 4,474 COPYRIGHT © 2011
  • 7. Rule #3:Use $ (dollar signs) on the first and last row only. Unless, of course, you aremixing rows of $ and %, etc. COPYRIGHT © 2011
  • 8. FORMAT CREDIBILITYThe presentation format does not interfere with (or create noise for) the reader COPYRIGHT © 2011
  • 9. ABC Company, Inc.Projected Statement of OperationsFor The Years Ended December 31, 2010 through 2013 DollarsRevenue: Market 1 $ 43 $ 2,320 $ 12,205 $ 46,232 Market 2 230 1201 7652 26450 Market 3 256 932 3250 12658 Market 4 55 85 2450 5974Total Revenue 584 4538 25557 91314Gross Margin ($) 120 1100 9203 43228Gross Margin (%) 20.5% 24.2% 36.0% 47.3%Operating Expenses: Sales & Marketing 555 2949 11500 31960 Research & Development 175 998 2811 8218 General & Administration 44 295 1533 4566 Total Operating Expenses: 774 4242 15844 44744Other Expense/(Income) 101 232 311 969Net Income (Loss) $ (755) $ (3,374) $ (6,952) $ (2,485)Statement Notes:HeadcountExisting 13 18 61 298New Hires 5 43 237 830Total Headcount 18 61 298 1,128Capital Expenditures $ 126 $ 424 $ 1,584 $ 4,474 COPYRIGHT © 2011
  • 10. Rule #4: Use column headings that make sense(and there are violators of this in the room) COPYRIGHT © 2011
  • 11. Rule #5: Numbers with thousands or millions must have commasThis: 54,556Not this: 54556 COPYRIGHT © 2011
  • 12. ABC Company, Inc.Projecte d Statement of OperationsFor The Years Ended December 31, 2010 through 2013 Dollars 2010 2011 2012 2013 Revenue: Market 1 $ 43 $ 2,320 $ 12,205 $ 46,232 Market 2 230 1,201 7,652 26,450 Market 3 256 932 3,250 12,658 Market 4 55 85 2,450 5,974 Total Revenue 584 4,538 25,557 91,314 Gross Margin ($) 120 1,100 9,203 43,228 Gross Margin (%) 20.5% 24.2% 36.0% 47.3% Operating Expense s: Sales & Marketing 555 2,949 11,500 31,960 Research & Development 175 998 2,811 8,218 General & Administration 44 295 1,533 4,566 Total Operating Expenses: 774 4,242 15,844 44,744 Other Expense/(Income) 101 232 311 969 Net Income (Loss) $ (755) $ (3,374) $ (6,952) $ (2,485) S t at em ent Not es: Headcount Exis t ing 13 18 61 298 New Hir es 5 43 237 830 Tot al Headc ount 18 61 298 1,128 Capital Expenditure s $ 126 $ 424 $ 1,584 $ 4,474 COPYRIGHT © 2011
  • 13. Rule #6: Don’t mix fonts Or font size……And do not use a silly font COPYRIGHT © 2011
  • 14. Rule #7: Text is left justifiedNumbers are right justifiedViolators confuse the reader COPYRIGHT © 2011
  • 15. Rule #8: Do not overdo color andDo not highlight in Use Spot color! COPYRIGHT © 2011
  • 16. Rule #9:Round your numbers to the nearest thousand for presentations Thank you Joe Caruso for this suggestion COPYRIGHT © 2011
  • 17. Rule #10: Spelle CheckAnd do not tell me you relied on Microsoft……. COPYRIGHT © 2011
  • 18. Financial Forecast in your Slide deck is a Marketing Effort! (Huh)? COPYRIGHT © 2011
  • 19. • Provide cost-effective outsourced (part-time) CFO support• Clients range from pre-revenue startups to later stage privately held companies• Goal = provide strategic financial advice and handle all accounting/ financial matters so the entrepreneurs can focus on driving the business COPYRIGHT © 2011
  • 20. David Fogel, CPASerial entrepreneurial CFOPrincipal of Swifton CFOs LLC (circa 2009)Experience with high tech companies ranging from biotechto telecom services to healthcare IT to social media to…Adjunct Instructor of Finance and Accounting – WPIJudge & Mentor:Sponsor:Associations: COPYRIGHT © 2011
  • 21. Developing The Financial Forecast 1. Defined 2. What about the assumptions? 3. Creating the sales forecast 4. Spreading the numbers 5. Creating the statements COPYRIGHT © 2011
  • 22. Ty Danco Member, Mass Medical Angels Member, North Country Angels"Ill never believe your revenue numbersanyway, but I sure want to scrutinize your assumptions and expenses!" COPYRIGHT © 2011
  • 23. Developing The Financial Forecast 1.What are financial projections? Collection of statements that present your business in numbers (IS, BS, CF, Cap) “Does the story make sense?” “Does the story add up?” COPYRIGHT © 2011
  • 24. Set your goals from top down but…..Prepare the model from the bottom up then….start over with your top down goals COPYRIGHT © 2011
  • 25. Developing The Financial Forecast2. What about the assumptions?Document the source of each number you produce - Why? - Knowledge of the assumptions proves that the entrepreneur understands the business - Prove it to yourselfSources of assumptions - Estimated or best guess (really try not to SWAG) - Desired goal to be obtained - Primary market research – surveys, vendor quotes - Second market research – purchased or gov’t information COPYRIGHT © 2011
  • 26. Developing The Financial Forecast 2. What about the assumptions? (part 2) Start-up costs (uses of $) Financing (sources of $) Capital expenditures (costs with >1 yr life) Fixed expense (cost of being in business) Variable expense (cost of doing business) Projected sales (anticipated revenue earned) Cash flow (anticipated $ received and spent) COPYRIGHT © 2011
  • 27. Start-up cost assumptions• Expenses up to the point when you are open for business…….which is when?• List all the uses of money – describe exactly how spent• Two types: Fixed assets & Working Capital• Examples? Fixed Assets = Equipment, Furniture Working Capital = Rental deposits, Insurance COPYRIGHT © 2011
  • 28. Financing assumptions• Sources where $ will come from• Where? Entrepreneur and team F&F Bank loan (though not likely for start-ups) Debt from owner or outside creditor Non-dilutive financing (maybe ) Equity capital• For loan – know amount, terms of repayment (mos), and rate of interest or return COPYRIGHT © 2011
  • 29. Capital Expenditures (aka Fixed Assets)• Costs that have a “lifetime” greater than one year AND an individual or collective cost greater than $2k• Predict some fixed assets by headcount, some by significant changes in sales volume, some by changes in product lines, etc.• Examples: Leasehold improvements, Furniture & fixtures, Machinery• Note: Probably expense the PCs & Macs & iPads (but try to keep track of them anyway) COPYRIGHT © 2011
  • 30. Fixed cost assumptions• Costs of being in business• Do not vary by sales volume (i.e. day-to-day)• But DO increase as the business scales• Create fixed cost projections on monthly basis• Research through correspondence with outside vendors• Record the source & amount from each vendor……..• Examples: Rent, Utilities, Salaries, Benefits, Marketing expenses, Administrative expenses COPYRIGHT © 2011
  • 31. Variable cost assumptions• Costs of doing business• May vary directly with sales volume• DO increase as the business scales• Expenses incurred with the next “unit” of product or service• Research through correspondence with outside vendors• Examples: Materials, direct/indirect labor, and shipping costs COPYRIGHT © 2011
  • 32. Projected sales assumptionsWhat product(s) and/or service(s)QuantitiesPriceWhen (seasonality/cyclicality)?T&C’s COPYRIGHT © 2011
  • 33. Cash flow assumptions• Convert your business activity to cash activity• When will cash be collected from customers? May vary by product line and by customer Generally assume 45 days---though currently customers are extending to 60 days• When do you pay your vendor’s invoices? May vary by product line and by vendor Generally assume 30-45 days Need to create “referenceable” vendors COPYRIGHT © 2011
  • 34. INTERMISSION
  • 35. Developing The Financial Forecast 3. Creating the sales forecast BEST - Predict by customer as detailed as possible ….but include customer turnover BETTER – Predict by market COPYRIGHT © 2011
  • 36. Developing The Financial Forecast 3. Creating the sales forecast (part 2) How do I start? Market research • Gov’t resources US Census Bureau IRS Statistical Data • Trade association • Primary & secondary research Select your geography COPYRIGHT © 2011
  • 37. Developing The Financial Forecast 3. Creating the sales forecast (part 2) Predict by client (customer) types • By market • By size Then ID certain characteristics Small Medium Large Client Client Client Average Hours Per 4 Hours 8 Hours 16 Hours Week Average Contract $ $500 $1,250 $2,500 Per Week COPYRIGHT © 2011
  • 38. Developing The Financial Forecast 3. Creating the sales forecast (part 3)Predict using Sales staff • Assume lag time (3-6 mos.) • Estimate the pipeline • # of calls / meetings per staff • # of sales per staff • Remember: Not all staff start same date • Spread out the volume by month – with realistic goals • ….Consider turnover of sales staff COPYRIGHT © 2011
  • 39. Forecast Trap:Why they call them “Gross Sales” • Returns • Discounts • Rebates • Chargebacks • Markdowns COPYRIGHT © 2011
  • 40. Forecast Trap: Do not over-estimate first year revenue(what, we can’t sell millions in first month?) COPYRIGHT © 2011
  • 41. Developing The Financial Forecast 4. Spreading the Numbers• Yes, you need to do it monthly -- for the entire period• No flat numbers – consider the meaning – use % increases or $ per some indice• Think: As headcount increases rent increases (just not variably)• Start with revenue, then cost of services COPYRIGHT © 2011
  • 42. Multiple Model Trap: One investor model, Multiple options (triggers)But…why not?You will make fundamental changes in thebase model and then forget to make similarchanges on the “other scenario models” COPYRIGHT © 2011
  • 43. Tip: IntegrationMust use an integrated modelHeadcount addedPayroll and benefits calculationSummarized employee costsIncome StatementCash Flow COPYRIGHT © 2011
  • 44. Tip: Use RoundingUse the MS Excel “roundingfunction” --- otherwise your numbers may not add up COPYRIGHT © 2011
  • 45. Question?Is the methodology Accrual or Cash? COPYRIGHT © 2011
  • 46. Tip:If you want to be taken seriously do not use round numbersThis: 53,567Not this: 50,000 COPYRIGHT © 2011
  • 47. Tip: Project payroll & benefits in detail• Payroll & benefits are often the most costly expense yet they are often neglected.• Project monthly to handle start dates correctly• Match additions of people with milestones COPYRIGHT © 2011
  • 48. Tip: Projection Numbers are not separate from the Company PlansCompany Plans Milestone Projects Responsible Revenue/ Dates Cost COPYRIGHT © 2011
  • 49. Tip: Be careful with Depreciation and Interest expense• Depreciation is a non-cash expense – do not include in cash flow (we’ll worry about how to calculate this when you come see me)• Interest expense does not include the principal portion of your payment COPYRIGHT © 2011
  • 50. Ben Littauer Member, Boston Harbor Angels"I like to see a business model spreadsheet with the assumptions clearly called out as variables. Then I can twiddle the knobs and see how sensitive profits are to the assumptions." COPYRIGHT © 2011
  • 51. Tip: Don’t forget the…..Sales commissions – Direct connect them to yoursales staff’s (or sales rep) salesBonuses – Include with payrollRecruiting expenses – Peg them to change in newemployeesDebt - Many forget to include Interest Expense onthe income statement even though the Companyhas incurred Debt COPYRIGHT © 2011
  • 52. Presentation SuggestionsSteady, consistent evolution of the model Revenue growth in $ Expenses over time in %Know the % change for major componentsDo not allocate G&A/Facilities expensesShow depreciation separately (non-cash) COPYRIGHT © 2011
  • 53. Tip: Reasonableness1. Once you think you are done take the smell test --- Do the numbers really make sense (i.e. can you really increase revenue w/o an increase in costs)?2. Do the Like-Kind test. Compare your “metrics” versus your competition COPYRIGHT © 2011
  • 54. Creating the Statements1. Consider it a Marketing Effort2. Present the Pro-Forma Financial Statement3. Graph the Revenues, Income, and Cash4. Present the Headcount COPYRIGHT © 2011
  • 55. ABC Co.($ 000s omitted) 2010 2011 2012 2013 2014 IncomePro Forma Financial StatementRevenue $ - $ 1,875 $ 44,953 $ 108,238 $ 180,161 StatementCost of Service - 1,162 12,739 5,369 -Gross Margin - 712 32,214 102,868 180,161 38% 72% 95% 100%Operating ExpensesEmployee Costs 1,303 2,972 3,587 4,198 4,379Professional Fees 253 637 1,780 1,230 1,135Marketing & Travel 61 525 2,340 293 658Administrative Expenses 60 55 232 41 47Development & Pilot Manufacturing 409 819 262 965 1,733Facility & Other 195 801 1,206 1,612 2,023Total Expenses 2,282 5,807 9,407 8,340 9,976Depreciation & Amortization 42 98 301 590 791EBIT (2,324) (5,193) 22,507 93,939 169,394 Cash FlowNet Income (2,639) (5,411) 16,893 55,530 100,603 0% -289% 38% 51% 56% StatementPro Forma Cash FlowCash from Operations (2,597) (5,313) 17,193 56,120 101,393Cash from Working Capital (31) (936) (2,879) (2,754) (3,437)Cash from Investments (57) (297) (1,052) (607) (600)Cash from Financing 7,000 - 42,000 - -Net Cash Flow 4,315 (6,545) 55,262 52,759 97,357Ending Cash $ 6,644 $ 99 $ 55,360 $ 108,119 $ 205,476 COPYRIGHT © 2011
  • 56. ABC Company – Financials by Year ($ 000’s omitted)$225,000 Seeking $250k Investment Milestone #1 Prototype$175,000 Milestone #2 Pilots Milestone #3$125,000 Commercialization Revenue Income Cash $75,000 $25,000 2010 2011 2012 2013 2014($25,000) COPYRIGHT © 2011
  • 57. ABC Co. Headcount Summary 2010 2011 2012 2013 2014Manufacturing - 1 1 1 1Sales & Marketing - - 1 4 4Research 7 19 19 19 19Executive/Admin 3 8 9 9 9International - 1 2 3 4Total 10 29 32 36 37 COPYRIGHT © 2011
  • 58. ABC Co. Headcount Summary 2010 2011 2012 2013 2014 For your reviewManufacturingSales & Marketing - - - 1 1 1 1 4 1 4 only. Not forResearch 7 19 19 19 19Executive/Admin 3 8 9 9 9 presentationInternational - 1 2 3 4Total 10 29 32 36 372010 Jan, 10 Fe b, 10 Mar, 10 Apr, 10 May, 10 Jun, 10 Jul, 10 Aug, 10 Sep, 10 Oct, 10 Nov, 10 De c, 10Manufacturing - - - - - - - - - - - -Sales & Marketing - - - - - - - - - - - -Research 7 7 7 7 7 7 7 7 7 7 7 7Executive/Admin 2 2 3 3 3 3 3 3 3 3 3 3International - - - - - - - - - - - -Total 9 9 10 10 10 10 10 10 10 10 10 102011 Jan, 11 Fe b, 11 Mar, 11 Apr, 11 May, 11 Jun, 11 Jul, 11 Aug, 11 Sep, 11 Oct, 11 Nov, 11 De c, 11Manufacturing 1 1 1 1 1 1 1 1 1 1 1 1Sales & Marketing - - - - - - - - - - - -ResearchExecutive/Admin 19 4 19 4 19 4 19 4 19 4 19 5 19 7 19 7 19 7 19 8 19 8 19 8 Looking at theInternational - - - - - 1 1 1 1 1 1 1Total 24 24 24 24 24 26 28 28 28 29 29 29 monthly2012Manufacturing Jan, 12 1 Fe b, 12 1 Mar, 12 1 Apr, 12 1 May, 12 1 Jun, 12 1 Jul, 12 1 Aug, 12 1 Sep, 12 1 Oct, 12 1 Nov, 12 1 De c, 12 1 headcount helpsSales & MarketingResearch - 19 - 19 - 19 - 19 - 19 - 19 - 19 - 19 - 19 - 19 1 19 1 19 you find obviousExecutive/AdminInternational 9 1 9 1 9 1 9 1 9 1 9 2 9 2 9 2 9 2 9 2 9 2 9 2 discrepanciesTotal 30 30 30 30 30 31 31 31 31 31 32 322013 Jan, 13 Fe b, 13 Mar, 13 Apr, 13 May, 13 Jun, 13 Jul, 13 Aug, 13 Sep, 13 Oct, 13 Nov, 13 De c, 13Manufacturing 1 1 1 1 1 1 1 1 1 1 1 1Sales & Marketing 1 1 2 2 3 3 4 4 4 4 4 4Research 19 19 19 19 19 19 19 19 19 19 19 19Executive/Admin 9 9 9 9 9 9 9 9 9 9 9 9International 2 2 3 3 3 3 3 3 3 3 3 3Total 32 32 34 34 35 35 36 36 36 36 36 362014 Jan, 14 Fe b, 14 Mar, 14 Apr, 14 May, 14 Jun, 14 Jul, 14 Aug, 14 Sep, 14 Oct, 14 Nov, 14 De c, 14Manufacturing 1 1 1 1 1 1 1 1 1 1 1 1Sales & Marketing 4 4 4 4 4 4 4 4 4 4 4 4Research 19 19 19 19 19 19 19 19 19 19 19 19Executive/Admin 9 9 9 9 9 9 9 9 9 9 9 9International 4 4 4 4 4 4 4 4 4 4 4 4Total 37 37 37 37 37 37 37 37 37 37 37 37 COPYRIGHT © 2011
  • 59. More on charts and tables……1. Highlight revenue especially as compared with your competition2. Explain the sales & distribution model (…so about those 90% margins)3. Key events to next funding round4. Cash flow cycle COPYRIGHT © 2011
  • 60. Universal Truths:1. Project monthly, Present annually2. Projections constantly change, let them. Not an annual exercise. Develop as a monthly exercise.3. Financials must be consistent with rest of presentation4. Do not need to be hung up with GAAP, but….don’t go rogue COPYRIGHT © 2011
  • 61. Even More Universal Truths:5. Be consistent – Don’t portray cost categories (or individuals) differently by year6. Have “Checks”7. P&L Income ≠ Cash Flow (we know this right?) COPYRIGHT © 2011
  • 62. Developing The Financial Forecast
  • 63. Contact Information:Email:Website:Twitter:Phone:Cell: COPYRIGHT © 2010
  • 64. COPYRIGHT © 2010

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