In my experience what the most helpful thing to investors and you will be bottoms up understanding of how the business looks with a somewhat reasonable set of assumptions. So make a tab full of your assumptions, number of customers, cost per customer, number of engineers, churn rate.
When do you collect cash from customers? When do you pay bills? How fast can you cycle cash? (Meaning if you pay back marketing over 2 years vs 2 months) a LTV/CAC ratio of 1.5 is not great, but if you have a 1 month payback you basically don't consume cash so that's cool (these can be signs of dads though). But I would just look online for comps for the specific inputs into your model.
If you want a template you can just look at PnLs online.
All forecasts for startups are wildly wrong. But I think of forecasting as a way of valididating a strategy. Lots of people dislike the "if we get 1% of the market we will.be huge" approach, but I like at least validating if that is the case (it is not always the case).
Forecasting can also help you understand pricing. If your market size is about 10,000 buyers what do you need to charge to have a business.
> When do you collect cash from customers? When do you pay bills? How fast can you cycle cash? (Meaning if you pay back marketing over 2 years vs 2 months) a LTV/CAC ratio of 1.5 is not great,
i recall seeing a talk from some saas company that was really driving home the importance of how quickly the business can generate cash to pay for customer acquisition costs. i think they talked about offering plans to sign up for 12 months in advance (with a fair discount) versus monthly, with the idea that if enough customers sign up to the 12 month plan at a 20% - 30% discount then if you still get enough cash in the short run to pay for the customer acquisition costs, and enough cash in the long run to operate at a profit, you can start to pour excess cash into customer acquisition
When do you collect cash from customers? When do you pay bills? How fast can you cycle cash? (Meaning if you pay back marketing over 2 years vs 2 months) a LTV/CAC ratio of 1.5 is not great, but if you have a 1 month payback you basically don't consume cash so that's cool (these can be signs of dads though). But I would just look online for comps for the specific inputs into your model.
If you want a template you can just look at PnLs online.
All forecasts for startups are wildly wrong. But I think of forecasting as a way of valididating a strategy. Lots of people dislike the "if we get 1% of the market we will.be huge" approach, but I like at least validating if that is the case (it is not always the case).
Forecasting can also help you understand pricing. If your market size is about 10,000 buyers what do you need to charge to have a business.