Financial Modeling
We have blogs in six categories. Click on the category name in the menu below to see blogs in that category. You can also use the search function.
August 26, 2024
Top Four FInancial Tips for Pre-Seed/ Pre-Revenue Companies
Founders frequently seek financial tips for pre-seed/pre-revenue companies. In this blog, we’ll explore four key areas:
1. Developing your initial bootstrapped budget
2. Ensuring that your unit economics are sound
3. Determining the number of customers needed to cover operating costs
4. Calculating the sales and marketing budget necessary to achieve your sales targets
January 31, 2024
Ultimate Guide “How to Estimate Demand for Early Stage Startups?”
For any early-stage startup founder, there are several key moments that mark the trajectory of the company’s growth and serve as a testament to the founding team’s hard work. To name a few, there are the MPV launch, your first customer, and, of course, your first term sheet.
Raising money is a daunting and outright scary task for any first-time entrepreneur, and thus getting that first term sheet from a professional investor is an incredible validation of your vision, product quality, and persistence.
January 15, 2024
The Startup Station Insights – Excel Tricks. How to Model Various Business Scenarios
A financial model is a quantitative representation of the company’s business plan. In a way, it is the company’s brain, demonstrating how its strategic decisions affect different functions and translate into financial results.
For that brain to work properly, we need to correctly create the step by step instructions of what happens with the company as a result of its strategic decisions, or financial model assumptions. The process of creating such assumptions and logic is the expertise of The Startup Station and the crux of our unique methodology.
The final step is the implementation of this logic, and this requires knowledge of Excel. In this article we discuss four most useful Excel tricks you can use for modeling a variety of business scenarios.
December 9, 2023
Five Reasons Why A Startup Needs A Financial Model
“Why create financial projections when it is all a guess?” That is a question I hear all too often. Many entrepreneurs and small business owners have trouble making estimates and reducing the uncertainty in which they operate to a limited set of variables within a structured model.
November 5, 2023
A Financial Model Is a Map, Not a Crystal Ball
There is a lot of misconception in the startup community about what a startup financial model represents and, especially, how accurate it is. When I discuss the importance of financial analysis with entrepreneurs, they push back arguing that there is no validity to the numbers not verified by the market.
October 19, 2023
How to Estimate Demand for Early Stage Startups?
If you are a founder in the process of creating financial projections for your pre-revenue company for the first time, most likely you have two thoughts.
Thought # 1: “This is hard”, and
Thought # 2: “This is futile because, without any data, I can only guess what my sales would be!”
Well, you are HALF right.
January 15, 2023
Five Most Common Financial Modeling Mistakes
Having reviewed hundreds of financial models across more than fifteen industries, I’ve identified five most common mistakes entrepreneurs make when creating their financials. In this article and the corresponding video, we discuss each of these mistakes in more detail so that you can learn how to model your company correctly and get funded faster.
January 15, 2023
Simulations vs. Financial Planning
For pre-revenue companies, forecasting demand is very challenging because there is no financial history.
To overcome that problem, some startup founders use random number generation as a tool to “logically generate” demand for their product or service. In their minds, this strategy is their best bet because they have no idea how to estimate demand otherwise.
January 14, 2023
Key Considerations in Modeling Early-Stage Ventures
The Startup Station was created to help you model ventures with no financial history. In this article and corresponding video, we discuss our approach in more detail.
January 14, 2023
How to Create Credible Financials Without a Product on the Market
I often get asked by entrepreneurs how to create assumptions for their financial model when there is no financial history, no product on the market, and no track record. How can they ensure that those assumptions are credible, justifiable, and taken seriously by investors, strategic partners, and other co-founders?
There are four things to consider to help you properly formulate your business strategy and convert it into a credible financial forecast.
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