Any entrepreneur or business owner that is looking to raise capital will need to provide investors with a long-term financial forecast. These forecasts provide insight into your business for many purposes including:
- better understanding your assumptions and goals;
- better understanding the strong and weak points in your business;
- better understanding the cost structure for scaling your business;
- examining the practicality of milestones and the cash needs for achieving them; and
- setting expectations for what needs to be accomplished and how long it might take.
First of all your financial model has to be credible in the eyes of your potential investors. Your forecast and your assumptions should show your future performance as entirely plausible and reasonable. Experienced investors will be completely turned off by numbers that are unrealistic and unlikely to be achieved. Second, your forecast should make sense and be easily understandable to both you and your targeted investor audience.
IAG’s business consultants provide a range of financial modeling services to cover all aspects of project finance including:
- Inputs;
- Working capital estimates;
- Income Statement;
- Cash Flow Statement;
- Balance Sheet;
- Revenue Assumptions;
- Expense Assumptions;
- Cash Flow Assumptions;
- Hiring and Salary Schedules; and
- Internal Rate of Return.