I know you may be bored just to think about the cash flow forecast complexity and the several hours you’ll need to dedicate to get something useful…
But, I have a something for you: an extremely simple and objective free template that will automatically generate a 24-month flow for you:
In the following paragraphs, I’ll guide you through the steps of building your cash flow forecast using the spreadsheet.
To insert your startup’s information, the first thing you need to do is to open the hidden fields.
Just click on the “+” signs that are above and in the left of the spreadsheet.
Form Columns “B” to “G”, is where you’ll insert the information about your startup’s cash flow.
Now, it’s time to input your startup’s information in the right fields.
You’ll find 4 big categories: “Fund Raising”, “Revenue”, “Costs & Expenses” and “Investments”.
Now, it’s when the magic starts to happen. The spreadsheet will automatically generate the flow, as soon as you’ve inserted the information.
In this first category, you’ll fill in the information regarding your fundraising sources. Here you have the following fields:
For example, if you and your partner will invest $30,000 each, in January, 2020, then you’ll have:
Now, it’s time to forecast the revenue flow you expect to receive from your customers. Fields:
For example, if you are working with a SaaS revenue model and you intend to sell a $40 subscription, expect start selling 100 subscriptions in Apr-2020, with a monthly increase of 1%. Here is what you should inform:
For this category, you’ll find three different sections:
% OF REVENUE: You’ll use this section for any cost that is dependable on your revenue. E.g.: taxes, sales commission, COGS, etc.
For instance, if, in your country, any revenue is taxed in 15%, you should insert:
FLAT + ANUAL RAISE: You should include in this section any cost or expense that have a regular flow. This costs will happen whether you have revenue or not. E.g.: Salaries, rent, energy, services, subscriptions, etc.
For example, you contracted office rent for $1,500/month and expect a raise of 5% in oct-2020:
SPORADIC/CUSTOM: In this last section, you may include any cost or expense that the flow doesn’t fit properly to the above categories. E.g.: an expense with an irregular flow.
For instance, you have a 3-month service from jan-2020 to mar-2020, with a variable amount. In this case, you’ll need to insert the amounts directly in the cash flow area:
Here, you’ll insert the investments you plan to do in the next 24 months. E.g.: marketing campaigns, new equipment, app development, etc.
For instance, if you have hired a third party to build your MVP, for $30,000, divided into 6 installments, starting in January-2020, you’ll inform:
Okay, as soon as you include your startup’s information, the spreadsheet will generate the flow. That’s awesome, isn’t it?
But, you know what is even more awesome? The insights you’ll gain from the flow to better drive your decisions..
These insights are presented in two different types of metrics: NET METRICS and GROSS METRICS.
The metrics you see here reflect the outcome of every item you’ve estimated in your forecast (Fund Raising, Revenue, Costs & Expenses, and Investments):
These metrics don’t take into account the revenue nor the costs associated with it. In other words, if you fail generating revenue in the next two years, how bad would that be?