Subscription Startup or Existing Business Financial Projection 3 Statement Model

Description
PURPOSE OF MODEL

Highly versatile and user-friendly Excel model for the preparation of a rolling 3 statement (Income Statement, Balance Sheet and Cash flow Statement) financial projection for a startup or existing business generating revenue from selling subscription products/services. The model allows the user to model up to 5 different subscription products/services.

The model follows best practice financial modelling principles and includes instructions, line item explanations, checks and input validations.


KEY OUTPUTS

The key outputs include:
- Projected full financial statements (Income Statement, Balance Sheet and Cash flow Statement) presented on a monthly basis across up to 5 years and summarised on an annual basis.
- Dashboard with:
o Summarised projected Income Statement and Balance Sheet;
o Compounded Annual Growth rate (CAGR) for each summarised income statement and Balance Sheet line item;
o List of key ratios including average revenue growth, average profit margins, average return on assets and equity and average debt to equity ratio;
o Bar charts summarising income statement and Balance Sheet projections;
o Chart presenting revenue mix and total users per month
o Gross profit by income source.


KEY INPUTS

Inputs are split into Income Statement and Balance Sheet Inputs. Most inputs include user-friendly line item explanations and input validations to help users understand what the input is for and populate correctly.

Setup Inputs:
- Name of business;
- Currency;
- First projection year and quarter;
- subscription product names, variable costs, staff cost, fixed costs, fixed assets and borrowings;
- Sales tax applicability for revenue and cost categories;

Actuals Inputs:
- Opening balance sheet (for existing businesses);
- Income Statement actuals (for trend analysis);


Projection Inputs:
- Revenue
o New Users;
o Free trial to paid user conversion rate;
o Monthly, annual, quarterly subscription mix;
o Renewal rates;
o Subscription prices.
- Variable Costs including:
o Cost per sale;
o Cost per user;
- Other cost inputs including
o Marketing costs
o Staff costs
o Other costs
- Sales and corporate tax inputs including rate and payment periods;
- Dividend inputs including amount or percentage of retained earnings and frequency;
- Fixed Assets including addition amounts and useful life;
- Borrowings including addition/redemption amounts and interest rate;
- Share Capital additions.


MODEL STRUCTURE

The model comprises of 9 tabs split into input ('i_'), calculation ('c_'), output ('o_’) and system tabs. The tabs to be populated by the user are the input tabs ('i_Setup', ‘i_Actuals’ and 'i_Assumptions'). The calculation tab uses the user-defined inputs to calculate and produce the projection outputs which are presented in 'o_Fin Stats', ‘o_Charts’ and ‘o_DCF’.

System tabs include:
- A 'Front Sheet' containing a disclaimer, instructions and contents;
- A Checks dashboard containing a summary of checks by tab.


KEY FEATURES

Other key features of this model include the following:
- The model follows best practice financial modelling guidelines and includes instructions, line item explanations, checks and input validations;
- The model is not password protected and can be modified as required following download;
- The model contains a dynamic timeline that allows for a mix of actual and forecast period across a 5-year period allowing projections to be rolled forward from month to month;
- Timeline is split on a monthly basis and summarised on an annual basis;
- Costs are split into: variable and fixed for better driver-based forecasting;
- The model allows for the following number of underlying categories for each line item (these can be easily expanded if required):
o Subscription Products – 5 products;
o Variance costs – 5 categories (1 for each subscription product)
o Staff costs – 8 categories;
o Marketing costs – 5 categories;
o Other expenses – 15 categories;
o Fixed Assets – 5 categories;
o Borrowings – 3 facilities;
- Apart from projecting revenue and costs the model includes the possibility to model inventory, deferred income, payables, fixed assets, borrowings, dividends, corporate tax and sales tax;
- The model included an integrated discounted cash flow valuation using the projected cash flow outputs;
- Business name, currency, starting projection period are fully customisable;
- Revenue, cost, fixed asset and Borrowing category descriptions are fully customisable;
- The model includes instructions, line item explanations, checks and input validations to help ensure input fields are populated accurately;
- The model includes a checks dashboard which summarises all the checks included in the various tabs making it easier to identify any errors.


MODIFICATIONS

If you require any be-spoke modifications to the tool, we are more than happy to assist with this. Please send us a private message or contact us on: [email protected]


ABOUT PROJECTIFY

We are financial modelling professionals with experience working in Big 4 Business Modelling teams and strong experience supporting businesses with their financial planning and decision support needs. Our aim is to provide robust and easy-to-use tools that follow best practice financial modelling guidelines and assist individuals and businesses with common financial planning and analysis processes.

We are keen to make sure our customers are fully satisfied with the tools / models they purchase and will be more than happy to assist with any questions or support required following or in advance of purchase.

We are also always keen to receive feedback so please do let us know what you think of our products/offering by sending us a message or submitting a review.