The last thing many technology entrepreneurs want to do is to become spreadsheet jockeys but once product/market fit has been achieved one of the next things to do is to develop a comprehensive financial model. Yes, before product/market fit you need to have a good idea if the business is potentially viable, and some spreadsheet work is necessary to understand the business economics, but this should be a simple exercise. Post product/market fit the financial model should be much more detailed.
Here are some resources to help build and think through a financial model:
- Bessemer’s Creating a Financial Plan for your SaaS Business
- Ryan Carson’s SAAS Model Google Spreadsheet
- Docstoc Financial Model Projections
- Guy Kawasaki’s Financial Models for Underachievers
Ideally there would be example financial models online that could be easily customized but the nature of most startups is that there are company-specific nuances requiring heavy customization. My recommendation is to familiarize yourself with as much as you can related to financial modeling while enlisting help when possible.
What else? Do you have any tips or examples for startup financial models?