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# Choi, Gowda, Szabo, Davidson, Salt, Hauk Excel Business Model 97 03(1)111

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### Choi, Gowda, Szabo, Davidson, Salt, Hauk Excel Business Model 97 03(1)111

1. 1. Password to UnProtect All Worksheets: 12345 Team Name Mpyreon (Team B) Set MKTG 1J Team Members Choi Ying Ying, Davidson Graham, Gowda Natasha, Hauk Chris, Szabo Courtney Date ######## Purpose To determine which investment is worth investing in
2. 2. Password to UnProtect All Worksheets: 12345 Investment Decisions Investment Term for 4 years Look up Team Team 3 Net present value of this investment (NPV) \$16,005.05 Internal Rate of Return (IRR) 20% Is it worth investing? YES Cash Flows Estimates for 4 Years Minimal Accepted Rate of Return Project: N.E.W business venture Rate of Return (Rough Estimate) Team 1 10% 14% Team 2 10% 17% Team 3 10% 57% Team 4 10% 79% Team 5 10% 86% Team 6 10% 7%
3. 3. 1. Input a Minimal Accepted Rate of Return (what the company wants to gain each year) 2. Input what amount (in \$) you want to invest in the company in the Investment Cost column. 3. Input the expected returns (projections) of the company each year. Estimates for 4 Years -------------Expected Returns--------------- Investment Total Revenues Year 1 Year 2 Year 3 Year 4 Cost for 4 years -\$ 70,000 \$ 20,000 \$ 20,000 \$ 20,000 \$ 20,000 \$ 80,000.00 -\$ 70,000 \$ 20,000 \$ 20,000 \$ 21,000 \$ 21,000 \$ 82,000.00 -\$ 70,000 \$ 20,000 \$ 30,000 \$ 30,000 \$ 30,000 \$ 110,000.00 -\$ 70,000 \$ 20,000 \$ 35,000 \$ 35,000 \$ 35,000 \$ 125,000.00 -\$ 70,000 \$ 20,000 \$ 30,000 \$ 40,000 \$ 40,000 \$ 130,000.00 -\$ 70,000 \$ 10,000 \$ 15,000 \$ 25,000 \$ 25,000 \$ 75,000.00 Avg. Revenue \$ 100,333.33 Minimum \$ 75,000.00 Maximum \$ 130,000.00
4. 4. NPV IRR IF 1 -\$ 6,602.69 6% NO 2 -\$ 5,168.36 7% NO 3 \$ 16,005.05 20% YES 4 \$ 27,308.93 25% YES 5 \$ 30,348.34 26% YES 6 -\$ 12,654.19 2% NO
5. 5. % of businesses Year still in the market 0 100% 1 85% 2 70% 3 62% 4 55% 5 50% 6 47% 7 44% 8 41% 9 38% 10 35% % of businesses still in the market after 10 years 100% 90% 80% 70% Percentages 60% 50% 40% 30% 20% 10% 0% 0 1 2 3 4 5 6 7 8 9 10 Year
6. 6. Investment Year 1 Year 2 Year 3 Year 4 Cost -------------Expected Returns-------------- Team 1 \$ 70,000 \$ 20,000 \$ 20,000 \$ 20,000 \$ 20,000 Team 2 \$ 70,000 \$ 20,000 \$ 20,000 \$ 21,000 \$ 21,000 Team 3 \$ 70,000 \$ 20,000 \$ 30,000 \$ 30,000 \$ 30,000 Team 4 \$ 70,000 \$ 20,000 \$ 35,000 \$ 35,000 \$ 35,000 Team 5 \$ 70,000 \$ 20,000 \$ 30,000 \$ 40,000 \$ 40,000 Team 6 \$ 70,000 \$ 10,000 \$ 15,000 \$ 25,000 \$ 25,000 Expected Returns of Each Team Year 4 Team 6 Year 3 Team 5 Team 4 Year Year 2 Team 3 Team 2 Year 1 Team 1 Investment Cost \$- \$10,000 \$20,000 \$30,000 \$40,000 \$50,000 \$60,000 \$70,000 \$80,000 Money
7. 7. TEAM 1 Year 1 Month Total Costs Total Revenue 1 \$ 81,000 \$ 40,000 2 \$ 10,000 \$ 40,000 3 \$ 10,000 \$ 40,000 4 \$ 10,000 \$ 40,000 5 \$ 10,000 \$ 50,000 6 \$ 10,000 \$ 70,000 7 \$ 9,500 \$ 80,000 8 \$ 9,500 \$ 90,000 9 \$ 9,500 \$ 70,000 10 \$ 9,500 \$ 60,000 11 \$ 9,000 \$ 50,000 12 \$ 9,000 \$ 50,000 Team 1's Cost vs. Revenue \$100,000 \$90,000 \$80,000 \$70,000 \$60,000 Total Costs Money \$50,000 Total Revenue \$40,000 \$30,000 \$20,000 \$10,000 \$- 1 2 3 4 5 6 7 8 9 10 11 12 Months