Revenue Growth in the Early Startup Years

Back in 2008 I was on a screening committee helping evaluate angel investment opportunities for a group of investors in town. Once a month we’d meet with 4-6 startups and pick two to present to the group. Well, one of the entrepreneurs delivered his pitch to the committee and did a great job.

Everyone around the table was interested and liked the startup. Then, one of the investors raised his hand and asked about the financial projections. There, on the screen, the entrepreneur pulled up the dreaded slide: $0 in revenue today and $100 million in revenue by the end of year three. Ouch. All the excitement left the room.

Here are a few revenue growth resources for the early startup years:

The best financial models are built from the bottom-up based on actual metrics from an operating business. While startup metrics can be minimal early on, after a few years they become more meaningful and reasonable financial models with revenue growth can be built.

What else? What are some more thoughts on revenue growth in the early years?

One thought on “Revenue Growth in the Early Startup Years

  1. This is a good point – it’s easy for founders and investors to let ‘hope of earnings’ cloud forecasts. It helps to know what other comparable businesses are achieving on an annual basis, as you can then make a more educated guess as to whether your business model has the ability to pivot the business into a higher bracket of turnover at a fast rate. Our site lists small businesses for sale in the UK, quoting annual turnover and in some cases annual profits, for a wide variety of business types.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s