Some investors ask a LOT of questions about LTV, CAC and KPIs. Knowing the numbers you have today is important, but investors are looking for something else… Check out the latest video from Troy to find out what investors are REALLY thinking when they ask about your LTV, CAC and other KPIs.
In the first three articles in this series, we looked at the big-picture motivation for startup financial modeling, why it’s important to start with your assumptions, and how to practically build your income statement and custom detail tabs. Today, we’ll finish off the series by examining how to construct the final components necessary to complete your model, including a quick discussion of unit economics and how to best keep your model updated.
In the first two posts in this series, we examined why building a financial model for your startup is important and how to practically get started with your assumptions tab. Today, we’ll continue by diving into the income statement and supporting tabs used to calculate your projected revenue and expenses.
In the previous post of this series, we described what financial modeling is and why it is important for startup founders to build their own models from scratch. Today, we’ll begin by diving into how to practically start building a financial model. In coming weeks, we will also be covering the income statement as well as cash flow, balance sheet and keeping the model updated.
The first of a four part series on building a financial model. In short, a financial model is an abstract mathematical representation of how a company works (and more importantly, how it will work going forward). The model has inputs and outputs. The inputs are the assumptions that drive the model, things like what drives your customer acquisition cost, what your churn rates are, how much you pay people, etc. The outputs are a set of projections that show how the company will perform if the assumptions are true. One model can produce multiple sets of projections given different assumptions.
