Join Whitney Johnson for an in-depth discussion in this video Building a financial model, part of Entrepreneurship Fundamentals.
- Once you put together your business plan,…it's time to build a financial model.…The purpose of a financial model is to set…short-term targets to keep you focused,…track costs, monitor cash, and to see…if you have a viable business.…In short, to tell the story of…your business using math.…As your business gains traction,…you may want to build an expansive, detailed model.…But as a start-up, you want to keep the calculations…simple, focusing on just a few line items.…The first item you forecast is revenue,…which is price times volume.…
From your business plan, you've made a first pass…at how much you'll sell and at what price.…Is this forecast data driven, meaning if…you're estimating you'll sell 100 units,…what are the assumptions behind that number.…For example, if you have an online business,…and you know that the average conversion rate…for your industry is three percent.…This implies 3,333 visitors to your website each month.…Is that realistic?…You probably won't get the right numbers initially.…That's ok. The point is to think logically…
- Finding your idea/problem to solve
- Finding your first customer
- Writing a business plan
- Deciding on a legal structure
- Building a team of employees and advisors
- Marketing your business
- Building a website
- Minding cash
- Managing stress
- Funding growth
- Balancing entrepreneurship and life
Skill Level Appropriate for all
1. Finding Your Big Idea
2. Starting Your Business
3. Building a Team
4. Marketing Your Business
5. Scaling Your Business
6. Funding Growth
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