Startup Funding Espresso -- How to Build a Financial Model
How to Build a Financial Model Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. It\u2019s best to build your own financial model so you understand it thoroughly. Here are the steps to build your financial model: Define the goal for the model.\xa0\xa0 Figure out how you will use it and what decisions you need to make. This will determine what details you need to include in your model. Input your historical results as this will set the format of the model. Start with revenue and figure out what drives it such as number of customers paying or number of products sold.\xa0 Calculate Cost of Goods Sold and include it as part of the revenue section. Next, add salaries into the model as this is one of the biggest expenses you have. Add in the other businesses expenses related to sales, marketing, and administration. Set up a working capital section as you\u2019ll need funds in the bank to pay expenses \u2018til the revenue comes in. Calculate your growth projections for each month for the next 24 months. Review the model to see if it is achievable. Finally, choose key metrics to include in the model and capture information that calculates those metrics. Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.Let\u2019s go startup something today. ___________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0 For Feedback please contact info@tencapital.group\xa0\xa0 Please , share, and leave a review. Music courtesy of .