One of the most accurate ways to determine what it costs a company to produce a given product or service is using an activity-based costing model. The below Excel template is a great starting framework for businesses to use in order to better understand their cost per unit. I had to delve back into my cost accounting days on this one.
Preferred Return Template with Multiple GP Catch-up Options
I've come across a new way to set up joint venture funds that I've never modeled before. In this template, there are now multiple tiers for GP catch-up. You can use either one or both and see how it effects LP returns / GP distributions / promote, and final IRR.
Financial Modeling and Acquisitions
Financial modeling can indeed provide acquisition entrepreneurs with a significant advantage. It allows them to thoroughly assess a target company's financial health, understand cash flows, identify potential risks, and determine a fair valuation. By building detailed models, entrepreneurs can simulate various scenarios, assess the impact of different strategies, and make data-driven decisions about whether an acquisition makes financial sense.
13-Week Cash Flow Planning Template in Excel
A 13-week cash flow planning template is crucial for businesses to manage short-term liquidity, anticipate cash shortages, and make informed financial decisions. It provides a clear, real-time view of cash inflows and outflows over the coming quarter, helping to maintain stability and avoid disruptions in operations. I've built one below that offers budget vs. actual functionality for even deeper analysis and tracking.
Space Company Financial Model Template
I've spent well over 30 hours developing this financial model that caters specifically to an end-to-end space business startup. The user can configure relevant assumptions for up to 4 lines of business and see what that looks like per income stream as well as how all the different factors effect overall operating profits as well as cash flows.
Retail Construction Financial Model - Real Estate Underwriting
Model out potential new construction of retail buildings with this template. It was built for an actual client that is using this framework to analyze real deals. The basic framework is as follows: Purchase land, construct building, build out tenant spaces, financing with some debt, operate for up to 15 years, and then exit. The model uses monthly periods for accurate cash flow analysis.
Franchise Business Models
Franchising is a dynamic business model that offers a range of opportunities and challenges for both franchisors and franchisees. It combines elements of entrepreneurship, management, marketing, and legal considerations. Below we are going to explore some of the ways this industry is structured.
What is a SPAC?
A Special Purpose Acquisition Company (SPAC) is a publicly traded company created specifically to raise capital through an Initial Public Offering (IPO) for the purpose of acquiring or merging with an existing private company. Often referred to as "blank check companies," SPACs have no commercial operations and do not produce products or services. Instead, they exist solely to find and merge with a target company, effectively taking that company public without going through the traditional IPO process.
Space Industry Startup Business Models and Risks
The space industry has evolved significantly over the past few decades, transitioning from government-dominated activities to a dynamic commercial sector with diverse business models. This transformation is driven by technological advancements, decreasing launch costs, and increasing demand for space-based services. Below, we'll explore some of the prevalent business models in the space industry, outline general costs and unit economics, and discuss the associated risks.
Using XLOOKUP Excel Formula in Finance with Examples
The XLOOKUP function in Excel is a versatile and powerful tool that has become invaluable for data analysis and financial modeling. It overcomes many limitations of older lookup functions like VLOOKUP and HLOOKUP, offering enhanced functionality and flexibility.
Lot Development Real Estate Cash Flow Template
Transform your real estate vision into profitable reality with this comprehensive financial model template designed for land acquisition, development, and sales. Whether you're an experienced developer or stepping into the industry, this powerful tool simplifies complex financial planning, helping you evaluate project feasibility, forecast revenues, and maximize return on investment. With intuitive features and customizable options, our template empowers you to make informed decisions, secure financing, and confidently navigate every stage of your development projects.
I'm a Professional Financial Modeler
Why Hiring a Skilled Financial Modeler Like Me is Crucial for Your Business
Hire me here.
In today's business world, making data-driven decisions is essential for success. Whether you're running a startup, managing real estate investments, or leading a SaaS business, having accurate financial models is key to understanding your company’s financial health and forecasting its future. This is where hiring an expert comes in. I'm a highly experienced financial model builder offering both pre-made financial model templates and custom-built solutions to meet his clients' needs.
The Value of Financial Modeling
Financial models are the backbone of strategic decision-making. They provide business owners with the tools to forecast revenue, expenses, cash flow, and more. A well-constructed model allows companies to project future performance, assess the impact of different scenarios, and evaluate the potential returns on investment. For complex industries such as SaaS, real estate, and investment funds, financial models can also help in valuing assets, analyzing risk, and planning growth strategies.
My deep industry knowledge, combined with industry-specific expertise in building models tailored to specific business needs, ensures that my clients have actionable insights at their fingertips.
Why Choose Me as Your Financial Modeler?
My approach to financial modeling is centered around accuracy, transparency, and customization. Here are a few key reasons why I believe I'm the best financial modeler:
Tailored Solutions: I work closely with each client to understand their specific needs and builds models that fit their unique circumstances. He’s not just creating spreadsheets; he’s developing tools that provide real-world answers to business questions.
Industry Expertise: With experience in sectors like SaaS, real estate, and general startup development, I bring a wealth of knowledge to the table. I understand the nuances of these industries and can create models that align with their financial realities.
Speed and Responsiveness: Time is often a critical factor when making business decisions. I prides myself on my ability to quickly turn around custom work, without compromising on quality. This responsiveness ensures clients get what they need when they need it.
Pricing Transparency: One of the core values of my financial modeling business is transparency. Clients can expect clear communication regarding pricing, timelines, and deliverables from the start, allowing informed decisions.
Protecting Intellectual Property: I take this work seriously and am protective of my time and intellectual property. I understand the value of my expertise and take care to ensure that both my clients and work are well-respected.
Selectivity in Clients: I choose clients that are a good fit for my services. This ensures I'm working with businesses that will truly benefit from the financial models I have to offer/build, and that I deliver maximum value.
Why Financial Modeling Matters
A solid financial model gives you the confidence to move forward with investments, expansions, and other business initiatives. It’s not just about crunching numbers—it's about giving you the clarity to make sound decisions that can positively affect your bottom line.
For any business looking to better understand its financial future or evaluate potential investments, the right financial model is invaluable. And having a skilled financial modeler like me ensures that your model is not just accurate, but also tailored to your specific goals.
In conclusion, if you need a financial model that’s built with precision, industry expertise, and customization, Jason at SmartHelping.com is the person to turn to. My ability to combine technical skills with industry insight makes him an invaluable asset to businesses looking for reliable financial projections and insights.
Debt Yield Calculation and Free Spreadsheet
Debt yield is a metric used in commercial real estate and other finance areas to assess the risk associated with a loan. It measures how much a lender can expect to earn from a property in relation to the total amount of the loan. Here's how to calculate it:
SaaS (B2C) Financial Model Template for AI-Powered Platforms
I built this B2C SaaS model within the context of an AI-powered financial advisory platform business. It includes a comprehensive 3-statement financial model template. The target customers for this would be startups and growing businesses. This model offers detailed projections across income statements, balance sheets, and cash flow statements. Whether you're seeking to attract investors or streamline your financial planning, this template provides the robust, data-driven insights you need to scale confidently. Featuring integrated assumptions, scenario analysis, and automated financial ratios, this tool is essential for any B2C SaaS platform looking to achieve sustainable growth. Download now and take the guesswork out of your financial forecasting.
I Build Pre-Seed Startup Financial Models
I've spent much of my career in financial modeling deal with pre-seed startups. This means startups that are looking to raise their first round or may have raised a small amount from friends and/or family. They may not be well capitalized, but they are some of the most energetic, enthusiastic, and positive clients I have. I'm going to talk about some of the considerations I look at when building a pre-seed financial model template.
Hydrogen Production Plant - 20 Year Financial Model Template
I have conducted thorough research on this venture and have developed a comprehensive financial model designed to assess the viability of a startup hydrogen production plant. This model is user-friendly, robust, and facilitates the simulation of various financial feasibility scenarios. By adjusting key assumptions, users can gain insights into projected revenues, expenses, cash requirements, and long-term investment returns.
Sales and Purchases on Account - Financial Modeling in Excel
This template is helpful to those that are trying to put together a 3-statement model in Excel and are struggling with the correct formulas and logic to properly balance the balance sheet with the income statement and cash flow statement for when sales and purchases are made on account (meaning the use of accounts receivable, accounts payable, and more).
How to Account for a Gain / Loss on Sale in Cash Flow Statement with the Indirect Method
When using the indirect method for preparing a cash flow statement, the gain on the sale of an asset is adjusted because the cash flow statement starts with net income, which includes the gain. However, the gain does not affect cash directly; it merely reflects the result of an asset being sold above its book value. Here's how to adjust for it:
Dynamic Loan Amortization Schedule Template
Loan amortization schedules that are adaptable and can be integrated into various financial models are highly valuable because they offer versatility, accuracy, and efficiency. These schedules allow for easy adjustments and seamless integration with different scenarios and financial tools, enhancing financial planning and analysis. This template was built to easily plug into any of the models you see here on the site or whatever models you are working with.
Examples of Concessions in Real Estate Modeling
In real estate modeling, "concessions" refer to incentives or discounts offered by property owners or landlords to tenants or buyers to make a property more attractive. These can take various forms, including:
Check out these real estate models.
1. Rent Abatements: Temporary reductions or waivers of rent, often used to entice tenants to sign a lease.
2. Free Rent Periods: Offering a certain period of free rent at the beginning of a lease term.
3. Tenant Improvements (TIs): The landlord may pay for or contribute to the cost of customizing the leased space to the tenant's specifications.
4. Discounts on Purchase Price: Reductions on the sale price of a property.
5. Cash Incentives: Direct payments to tenants or buyers, sometimes referred to as "cash-back" deals.
6. Reduced Security Deposits: Lowering the amount required for a security deposit.
Generally all concessions will be defined by a single row in real estate models and based on a % of potential rental income. Sometimes, these reductions to income are just lumped into vacancy.
You may also be interested in what economic vacancy is in RE models.
Concessions are used to attract tenants or buyers, especially in competitive markets or when there is a need to quickly lease or sell a property. In financial modeling, these concessions are accounted for in cash flow projections, impacting the overall valuation and financial performance of the property.
Article found in Real Estate.
Financial Statement Example for Non-Profit
Creating a comprehensive set of financial statements for a non-profit organization involves several key line items. Here’s an outline for each of the three primary financial statements: the Statement of Financial Position, the Statement of Activities, and the Statement of Cash Flows.
Is There Opportunity in the Wind Farm Business?
There is significant opportunity in the wind farm business due to the increasing global emphasis on renewable energy sources and the decline in the cost of wind technology. Here are some key factors and locations to consider:
Exit Readiness Model - How Ready Is Your Business to Sell?
I built this template to help any business understand their readiness for an exit. It can also be used to help understand the value of a business you are trying to buy. The framework is not specific to any one industry and hits on key aspects such as financial health, governance, risk, scalability, and more. After going through this exercise, it will become clearer how sellable your business is and if it is more likely to sell on the higher or lower end.
What is Economic Vacancy in Real Estate Modeling
Economic vacancy refers to the financial impact of vacant space within a property as well as loss of income from other factors (concessions, bad debt, non-payers, below-market rent). It measures the income loss due to unoccupied units and other factors or spaces that are not generating rental revenue. This concept is crucial in real estate, particularly for property investors and managers, as it reflects the potential income shortfall resulting from vacancies.
What is "Loss to Lease" in Real Estate Modeling?
"Loss to Lease" in real estate is a term used primarily in the context of property management and investment, particularly in multifamily and commercial real estate. It refers to the difference between the actual rent being paid by tenants and the potential rent that could be obtained at current market rates. It could be positive or negative and yes I've seen situations where the existing rent is more than the market rents. It means there is less opportunity to improve rents.
Importance of Cost Allocation, Specifically Overhead Allocation
Cost allocation, particularly overhead allocation, is a critical task in accounting that involves distributing indirect costs to various departments, products, or cost centers. Overhead costs include expenses that are not directly tied to production, such as rent, utilities, and administrative salaries. Proper allocation of these costs is essential for accurate financial reporting, pricing, and strategic decision-making.
Investing in Land - Pros and Cons
Investing in land, commonly referred to as "dirt" in real estate parlance, can be a lucrative venture, but like all investments, it carries both advantages and risks. Below is an analysis of the pros and cons, along with common strategies employed to profit from land investments.
Solar Panel Installation Business: 10 Year Financial Model Template
I recently developed a bespoke model for a client, adding another valuable template to the renewable energy sector offerings. This business model and deployment strategy might surprise you, as it operates differently than traditional approaches. Here, the primary revenue stream comes from energy sales measured in kWh, rather than installation fees. I'll provide a detailed explanation of the entire model below. I've recently discovered this type of business could be considered 'Solar-as-a-Service'.
Explanation of Each Startup Fundraising Round and Expectations per Round
Fundraising rounds for a startup typically follow a sequence, each catering to different stages of the company's development. Here are the primary fundraising rounds:
Financial Model Template Update: Line of Credit Added to Made-to-Order Manufacturing Model
I have had quite a bit of interest in the made-to-order financial model over the last year and with that has come a few modifications that have made sense to use on the master version of this template. Let's dive in!
Template: Made-to-Order Manufacturing Financial Model
Updates:
- Added a line of credit facility. This makes it easy for the user to go in and manually define any loan draws over time on a monthly schedule. There is also a manual input for loan repayment and interest will auto calculate based on the balance each month, if there is a balance. The balance sheet, cash flow statement, income statement, and all relevant summaries have been updated with this assumption. Ratios impacted include the debt-service-coverage ratio. This is a great tool to help manage cash flow and the cost of borrowing over time. I've also displayed helper columns that show the operational cash flow and value of accounts receivable and inventory over time.
- I also added a brand new alternative version of the MTO manufacturing model that also has the line of credit module. However, it is also updated with an input to automatically account for inflation of prices and expenses. (half of the fixed expenses in each cost section are manual and half you just enter the first year cost and the following years will follow the % increase input. Each row is configured independently.
- Also, on the alternative version I made the fixed expenses tab all be annual figures instead of monthly. You can adjust what that cost is yearly, but the amount you enter is now the expected annual amount instead of the expected monthly amount.
Adding IRR Sensitivity Tables to 3 Real Estate Models
IRR sensitivity tables are invaluable in real estate models because they provide a clear, quantitative assessment of how changes in key assumptions, such as rental growth rates, cap rates, and construction costs, impact the internal rate of return (IRR). By systematically varying these inputs and observing the resulting IRR, investors and analysts can gauge the potential risks and rewards associated with different scenarios, enhancing their decision-making process. This helps in identifying the most critical variables that affect project viability, thus enabling more informed investment strategies and risk management. Ultimately, these tables support a thorough understanding of the sensitivity of returns to various market conditions and operational changes, ensuring that investors can make well-informed decisions based on a range of possible outcomes.
Real Estate Syndication Fees
Real estate syndication fees are charges incurred during the process of pooling capital from multiple investors to invest in a real estate project. These fees compensate the syndicator (the party managing the investment i.e. the GP) for their work and can significantly impact the returns to investors. Here's a breakdown of common syndication fees and how they typically flow into a preferred return waterfall:
Owning a Business Can Hedge Against Inflation
Owning businesses can be a highly effective long-term strategy for several reasons, including its potential to combat the effects of inflation:
Financial Model Template Update: Adding Option to Accrue or Not Accrue Interest on Wind Farm and Biogas Models
I recently built the hydropower construction financial model and in it the construction loan needed an option to have the interest paid during the interest-only (i/o) period or accrue and compound. For the past week I've been debating on adding that functionality update to the wind farm and biogas models as they both have interest-only loan options, but if that is chosen, the interest automatically accrued and compounded until the REFI / conversion month. Now, they also have the additional feature to pay interest during i/o period or accrue and compound.
Why Excel is the Best Tool for Financial Planning and Analysis
Excel has long been a cornerstone tool for financial planning and analysis (FP&A) due to several key attributes that make it a powerful and versatile solution:
Financial Model Template for a Dam (Hydropower) - Renewable Energy Infrastructure
I am enthusiastic about embarking on the development of my fourth financial model within the renewable energy sector, specifically focusing on hydropower. This business model leverages the natural flow of water and gravitational forces to generate electrical energy, offering a sustainable and long-term energy solution.
Hydropower projects are capital-intensive, requiring significant initial investment. However, they promise substantial returns as they provide communities with a reliable source of clean energy for up to fifty years. My experience in financial modeling and planning for infrastructure projects ensures that this model will be meticulously designed to capture the complexities and potential of such a transformative endeavor.
Major Events That Shaped Financial Reporting and Accounting Standards
Below are some things that have shaped a big part of the industry I work in.
If you want to support me and my continuous building of new bottom-up dynamic 3-statement models, check out these financial model templates that help anyone create robust projections across 100s of different industries.
Strategies to Keep an Auto Repair Chain Running During Slow Times and Location Scaling
Maintaining the profitability and operational efficiency of an auto repair chain during slow times and managing location scaling requires strategic planning and implementation. Here are some strategies for both scenarios:
Stop Confusing Preferred Return (Pref) with IRR Hurdles
People often confuse the terms "preferred return" and "IRR hurdles" because both concepts are related to the distribution of profits in real estate and private equity investments, and they both aim to ensure investors achieve certain financial benchmarks. However, there are key differences between them that can help clarify their distinct roles:
Strip Mall Real Estate Model - For Acquisitions - Up to 30 Tenants
This comprehensive template is designed for real estate operators specializing in the acquisition, renovation, and enhancement of strip malls. The model supports the management of up to 30 tenants and accommodates a holding period of up to 10 years. It includes detailed assumptions for joint venture partnerships, enabling precise financial projections and strategic planning for increased rental income and profitable exits.
Valuation Multiples for Top 10 Industries in the United States
Valuation multiples for private companies vary by industry, size, growth prospects, and other factors. Here’s a look at the typical business valuation multiples for private companies in the 10 biggest industries in the United States, along with the major factors impacting their valuation:
Debt Funds and Real Estate
Debt funds in the real estate industry are investment pools that lend money to real estate developers or owners. Investors put their money into these funds with the expectation of receiving regular interest payments, and eventually, the return of their principal. Here’s a detailed look at how these funds operate, the potential risks involved, and how to model such investments.
Start an Electrical Vehicle Charging Station Business: 10 Year Financial Model Template
Starting an electric vehicle (EV) charging station business involves tapping into a rapidly growing market fueled by the global shift towards electric vehicles. This business requires strategic location selection, such as high-traffic urban areas or corridors between cities, and an understanding of the technological requirements for different types of chargers. It also demands knowledge of regulatory environments, as government incentives and policies can significantly impact operations. Successful entrepreneurs in this space not only provide essential services to EV owners but also contribute to the infrastructure that supports sustainable transportation.
Revenue Leakage and SaaS: What it Is and How to Minimize
SaaS (Software as a Service) revenue leakage refers to the loss of potential revenue within a SaaS business. This typically happens due to various reasons, such as:
Latest Custom Financial Models Added to SmartHelping Plus - 5/6/2024
This was a slower tranche of spreadsheet work in the last few weeks, but some very useful modifications were done in the equipment rental and SaaS acquisition space. I was actually considering updating the base equipment rental model with this update, but I've chosen to only add it here for now.
SmartHelping Plus Spreadsheet Update Log
As I added new financial model templates to the SmartHelping Plus bundle, I'll be doing more in-depth explanations and videos about the customizations done to or the main premise behind the files that get added to this bundle. Here you will see time-stamped logs with a link to the update of each tranche. Usually I will try to do an update log every few weeks or at least monthly to go over all the new additions.
- 6/21/2024 - Condo Development Cost per Sq Ft Override
- 5/6/2024 - Equipment Rental new revenue logic for additional revenue types and SaaS
- 4/16/2024 - Primarily Condo Development Modifications (build and sell version)
Download all these spreadsheets here.
Real Estate Model: Single Tenant Industrial
I've built a wide range of real estate models across many categories, including self-storage, multi-family, apartment buildings, mixed-use, condos, STRs, assisted living, hotels, and mobile home parks. However, single tenant industrial real estate underwriting is something I have not specifically built something for out of the box until now. This template has everything you need to fully analyze many different scenarios for the acquisition or new construction of industrial real estate targeted to single tenants.
5 Year LBO Financial Model with T12 and T3 Input Frameworks, Waterfalls, and More
Enhance your evaluation of new business acquisitions with this effective LBO model. It includes input frameworks for both Trailing 12-month (T12) and Trailing 3-month (T3) data, along with a variety of financing options. Tailor your analysis with entry multiples (based on EBITDA, Revenue, or Manual Entry) and exit multiples using the trailing 12-month EBITDA multiple. The model also includes detailed projections for expected revenue growth, cost of goods sold, operating expenses, and debt service coverage ratio. Streamline your deal analysis with this versatile financial model template.
Construction Business KPIs and How to Improve Each One
Key Performance Indicators (KPIs) for a construction business are crucial for measuring the effectiveness, efficiency, and success of various operations within the industry. Here are several important KPIs typically used in the construction sector:
Latest Custom Financial Models Added to SmartHelping Plus - 4/16/2024
This is the April 16, 2024 tranche of new custom spreadsheets that I have added to the SmartHelping Plus program. There are four new sheets here that range from manufacturing to enterprise SaaS and real estate development. You can see what real clients want built directly now.
Biomethane (biogas) Financial Model Template
This is my second big renewable energy financial model (the first was for a wind farm). It is exciting to feel like I am contributing in some way to a more sustainable future by using the skills I have. In this case, it is creating an awesome bottom-up financial modeling tool for the industry. This is a scaling and capacity-based model that deals specifically with feedstock processing, the related costs, and the resulting yield of such activity over time.
Diving Into the Details of a Semiconductor Manufacturer
The unit economics of a semiconductor manufacturer describe the revenue and costs associated with producing a single unit of product, such as a semiconductor chip. This analysis is crucial for understanding the profitability and financial sustainability of the manufacturing operations. Semiconductor manufacturing is notably complex and capital-intensive, involving high upfront costs but benefiting from economies of scale. Here’s a detailed look at the unit economics:
6 Reasons Financial Statements Include Depreciation Expense
The inclusion of items like depreciation in financial statements offers several benefits that enhance the insights these statements can provide about the financial health and operational performance of a company. Here's how depreciation plays a key role in this regard:
What are Non-cash Expenses?
Non-cash expense items are expenses recorded on a company's income statement that do not involve actual cash outflow during the accounting period. These expenses are accounted for to represent the cost of using or consuming an asset over its useful life or to adhere to accounting principles such as the matching principle, which states that expenses should be matched to the revenues they help generate. Non-cash expenses provide a more accurate picture of a company's operational costs and profitability by including the cost of assets that are not paid for in cash at the time they are consumed.
Why I Include Terminal Value in Startup Financial Model Templates
Including a terminal value in a 5-year startup financial model is crucial for several reasons, particularly when assessing the long-term viability and valuation of the company beyond the initial forecast period. Here’s why it’s important:
Maximizing Customer Lifetime Value: SaaS/Membership vs. One-Time Revenue Models Explained
The question of whether customers have a higher Lifetime Value (LTV) with a Software as a Service (SaaS) / membership model compared to a one-time revenue structure is multifaceted, involving considerations around customer behavior, pricing strategies, value delivery, and business sustainability. The core difference between the two models is that SaaS/membership models rely on recurring revenue from subscriptions or memberships, while one-time revenue models rely on single transactions for products or services.
Investing in Startups and Dilution
Dilution occurs to an investor's ownership percentage in a company when the company issues more shares, typically during a capital raise. Here's a step-by-step explanation of how it happens:
Payroll KPI Excel Template
Tracking the right Key Performance Indicators (KPIs) for payroll can significantly impact the efficiency and effectiveness of your payroll process, ensuring compliance, enhancing employee satisfaction, and contributing to better financial management. This template tracks the most essential payroll KPIs.
Direct vs Indirect Method for Cash Flow Statement
Ok accounting people, you may have heard that when doing a cash flow statement, there are multiple methodologies that can be used to come up with the actual total cash flow change in the period. When building this logic in a 3 statement model in Excel, with formulas, this consideration is relevant and important. I'll talk about what method I use in every single model you see on this site.
Overlooked Things in Real Estate Diligence That Can Cost You
Diligence and attention to detail are paramount in real estate investing for several reasons, as the complexity and significant financial stakes involved can lead to substantial losses if key aspects are overlooked. Here are why they're important and examples of commonly overlooked areas:
Wind Farm Financial Model Template
I'm jumping into the renewable energy space with this new financial model. It is specifically for wind farms / wind turbines. The revenue and expense assumptions presented new dynamic logical configurations to get a applicable financial feasibility study spreadsheet tool. These businesses are capital intensive and require precise planning in order to understand all the various unit economics / potential returns.
DCF Models and Valuation
Mastering DCF Analysis in Excel Financial Modeling
Creating a robust Excel model capable of performing Discounted Cash Flow (DCF) Analysis involves a nuanced understanding of valuation methodologies and the integration of DCF analytics. This guide delves into the critical aspects of constructing a DCF model, focusing on valuation considerations and the application of DCF analysis within financial modeling.
Job Bidding Excel Template
This is a great tool for contractors that need to refine their job bidding process. I made the template as granular as possible so there are inputs for each individual line item. The calculator looks at three types of costs: wages, direct costs, and fees.
Financial Model Templates: Scaling Models vs Single Operation Models
Many of the financial models I've built here on the site can be grouped into one of two categories. Scaling or single location. An example of 'scaling' would be a financial plan for opening 10 franchises over 5 years. An example of a single location is just like it sounds, a financial plan for opening a single laundromat or single mobile home park.
Historical Home Sales, Blockchain, and Financial Feasibility
I normally focus on just financial modeling templates, but I also dabble in a bit of crypto / blockchain research as well as real estate underwriting. Here are some ideas I've found about trying to integrate something with historical home sales so there is a single, cohesive record. I think that would be valuable, but not sure the economics work.
3 Statement Modeling and Capex
Here I am looking at one of the most common types of transactions included in a 3 statement model template. It is capital expenditures or Capex. In simplest terms, it just means money spent on items that have a useful life greater than 1 year. These are generally considered long-term fixed assets. Examples involve buying buildings, equipment, and property. I'll try to explain how to connect everything below.
Fair Value vs Historical Cost Accounting
Fair value and historical cost are two fundamental valuation methods used in accounting and financial reporting. Each approach has its advantages and disadvantages, and the choice between them can significantly impact how a company's financial health is perceived. Here's a comprehensive look at both methods, their pros and cons, and an analysis of which provides better information:
Update to Multi-Family Real Estate Model: Single Property Version
I actually walked through this update in real time as I removed property configurations two through four. You now have a single property version that comes with the download and a four property version.
Financial Model Templates for New and Innovative Businesses
I try to continually improve how I communicate the value of the financial models you will find on this site. One way to by finding ways to categorize the 100s of spreadsheets. Here, I'm going to focus on all the templates that were designed and/or can be utilized for new and innovative businesses. I consider a 'new' business something that didn't exist 10 years ago and I consider an 'old' business something that has been around for multiple decades. However, there could be models that represent a new or innovative method applied to an older business model, see below:
Real Estate Template: Adjusted Cost Basis
Calculating the adjusted cost basis of a property is a critical but complex process that involves several intricate steps and considerations. The adjusted cost basis is essentially the original purchase price of the property plus any improvements, less any depreciation, damages, or losses. This figure is crucial for tax purposes, particularly when selling or disposing of the property, as it helps determine the capital gains tax owed.
Pros and Cons of Starting a Home Service Business and Scaling
Starting a home service business, which can range from cleaning, landscaping, home repairs, to personal training, offers several advantages and challenges. The profitability of such a venture can vary widely depending on the specific industry, location, and business model. Here's an overview of the pros and cons, potential earnings, and steps to scale up a home service business.
Aligning Interests: Modeling Fair Real Estate Joint Venture Structures
Modeling a real estate joint venture (JV) in a fair way involves structuring the investment so that it aligns the interests of all parties and provides an equitable return based on the risk and capital each party contributes. The choice between preferred equity, an internal rate of return (IRR) hurdle, and simple return structures depends on the goals, preferences, and risk tolerance of the investors involved. Let's explore each option:
Pros and Cons of Starting a Daycare Business / Facility
Starting a daycare business can be a fulfilling venture, both personally and financially, for those passionate about child care. However, like any business, it comes with its set of challenges. Here's a comprehensive list of pros and cons to consider:
The Difference Between Required Rate of Return and Discount Rate
The discount rate and the required rate of return are fundamental concepts in finance, used to evaluate investments and determine their value. While they share similarities in their roles of assessing the attractiveness of investment opportunities, they serve different purposes and are used in different contexts. Let's explore both terms to understand their differences and similarities.
The Time Value of Money and IRR / NPV in Financial Modeling
Ok, we are going to talk about something that effects the personal saver as well as big corporate finance teams. That is the time value of money. Some people think it is voodoo (same with the IRR) calculation, but it is a very real concept that should be understood by anybody in finance. There are a lot of good ways to explain its significance and place within financial modeling / financial planning and analysis.
What "Four-wall" EBITDA Means - Restaurant and Retail Financial Modeling
"Four-wall EBITDA" refers to a financial metric used primarily in the retail and restaurant industries, although it can be applied to any business with physical locations. It measures the earnings before interest, taxes, depreciation, and amortization (EBITDA) of a particular location or unit, taking into account only the costs and revenues that occur within the four walls of that location. This includes sales revenue and direct operating expenses such as labor, utilities, and supplies, but excludes overhead costs like corporate expenses, taxes, and interest payments on debt.
Advanced Financial Modeling Configuration for Laundromat Template
I had a customer request to add a whole bunch of financing toggles and configurations to the Laundromat financial model. These were really cool so I decided to produce a second advanced version that had these items included. In order to understand them, a strong finance background is going to be required. It is easy to use the Excel template, but it is hard to understand the concepts if you've never heard of them before. See more below.
How Withdrawals / Deposits Effect a Hedge Fund High Watermark
Determining the ending period high watermark for an investment account when there is a withdrawal requires a bit of calculation, primarily to adjust the high watermark for the impact of the withdrawal. The high watermark is a concept used in the management of investment funds, particularly hedge funds, to ensure that managers are only paid performance fees on net new profits. Note, agreements can vary and every hedge fund could have a different way of handling redemptions/contributions after the initial investment.
Hedge Fund Fee Model Template: Soft Hurdle with High Watermark
I was genuinely surprised to uncover the intricate details involved in the 2 and 20 compensation model for hedge funds. It's fascinating to learn about the various configurations possible within this framework. The model outlined here incorporates the concept of a soft hurdle, which resets annually, and provides for the possibility of both an asset management fee and a soft hurdle option. Crafting these provisions into a legal operating agreement proves to be a complex task, emphasizing the value of a simplified model to effectively communicate these concepts to investors.
Just-in-Time (JIT) Inventory and Car Dealerships
The Just-In-Time (JIT) inventory management system, which aims to reduce inventory holding costs by having goods arrive as they are needed in the production process, has been widely adopted in manufacturing (see this made-to-order manufacturing financial model for more on that), notably in the automotive industry. Its application in car dealerships, however, presents a different set of challenges and opportunities. Whether JIT is the way of the future for car dealerships depends on several factors:
SaaS CFO Dashboard Template
As a CFO of a Software as a Service (SaaS) company, focusing on key financial and operational metrics is essential for driving strategic decisions, ensuring the company's financial health, and achieving long-term growth.
SaaS Rule of 40: Financial Analysis - EBITDA and Revenue Growth
The "Rule of 40" is a popular benchmark in the Software as a Service (SaaS) industry that evaluates the performance and health of a company. It serves as a guideline for balancing growth and profitability in a SaaS business. The rule states that a company's growth rate plus its profit margin should equal or exceed 40%. Here's how it breaks down:
Worst SaaS Businesses to Start or Acquire
Starting a SaaS (Software as a Service) business can be a lucrative endeavor, but success is not guaranteed. Certain types of SaaS businesses may pose higher risks or face more challenges than others. Here are some types of SaaS businesses that could be considered more challenging or less favorable to start, based on market saturation, high competition, significant regulatory hurdles, or a limited customer base:
What May You Want to Include on a SaaS CFO Dashboard
For a SaaS (Software as a Service) CFO dashboard, focusing on financial metrics that provide insights into the company's performance, growth potential, and financial health is crucial. Here are some key elements to include:
Why Banks Want to See Financial Projections for Your Startup
If you are trying to start a new business, one of the first things that is required to get the ball rolling is a request for funds from the bank (unless your own money). So, in most cases a financial projection needs to be submitted to the bank. This is a major source of my clients: Startups that need financing from a bank. Investors usually want to see financial projections as well.
Qualifications and General Responsibilities of a CFO
When I was going through college, I always thought a CFO must be a CPA (Certified Public Accountant) at the very least. As I made it through to more advanced finance classes and learned, it was clear this was not the case. Having strong general accounting knowledge is definitely important, but there are many aspects to being a CFO that have nothing to do with accounting rules, taxes, or regulations of financial reporting.
Do Good Managers Need Industry-specific Experience?
The necessity of industry-specific experience for a good manager can depend greatly on the context of the role and the industry itself. However, while industry knowledge can be very beneficial, it often comes second to possessing strong management skills. Good management techniques and the ability to lead, motivate, and effectively communicate with a team are generally considered more crucial. These foundational skills can be applied across various industries, and specific industry knowledge can be acquired over time.
Daycare Service Financial Model Template
When developing a comprehensive financial model for initiating a daycare service business, it's crucial to incorporate certain key assumptions. In my approach, I've factored in constraints related to the capacity of different types of care, along with two additional sources of revenue.
Financial Model Templates Grouped by Complexity Level
To understand the complexity involved in each category, I'll try to put a little explainer on why a given template is at a certain level. This is going to be roughly based on the amount of accounting and finance knowledge as well as industry-specific knowledge required to use the template to its fullest extent. There is a subjective element to this as it is my opinion about how much knowledge you need to understand a given template, but this should give general clarity as to what each template feels like to use. I've not included 100% of my templates here, but it should give you a good idea of what to look for when trying to understand various frameworks that are being used.
SaaS Pricing Models and Templates
SaaS (Software as a Service) pricing models vary depending on the needs of both the provider and the customer. Here are some of the most common models:
Loan Portfolio Analysis Template
Elevate your financial analysis with this cutting-edge Loan Portfolio Analysis Template, meticulously designed for Microsoft Excel. This sophisticated tool is a game-changer for financial professionals seeking to dive deep into their loan portfolio data with ease and precision.
Diving Into the Secrets of SaaS Success: Navigating Startup Costs and Equity Essentials
Starting a Software as a Service (SaaS) business involves various startup costs, which can be categorized into several key areas:
Financial Model Template for the Food Industry
In the dynamic and competitive realm of the food industry, the foundation of a successful business strategy often lies in the effective utilization of financial models. The right financial model template for creating pro formas in this sector depends on the underlying unit economics. This template will empower businesses to accurately forecast revenue, manage costs, and anticipate market trends. It integrates industry-specific variables such as seasonal demand fluctuations, supply chain logistics, and consumer spending habits, offering a comprehensive tool for financial planning and decision-making. Food industry professionals seeking to navigate the complexities of financial forecasting and strategy development will benefit from the below.
Modeling Negative Churn in SaaS Businesses
Some consider negative churn the holy grail of SaaS (Software as a Service). It simply means that there was an increase in MRR from existing customers that was greater than the MRR lost from churned customers. Hence, a negative of a bad thing, is a good thing.
Excel-based SaaS Financial Model
If you are looking for the best SaaS financial model template to meet your needs, you've landed in the right place. I can't tell you how many times my clients have simply said "I wish I would have found you first". When it comes to modeling out SaaS business cases in Excel, my frameworks have been heavily utilized in small and medium-sized businesses and I've even built a few for billion-dollar enterprises.
What is Possible with Excel Financial Models?
I have spent my entire professional adult life working in Microsoft Excel. The earliest exposure was in Accounting class during college. My first job involved working with income statement and balance sheets that were being prepared in Excel as a transition from an old software to a new software. I then moved into real estate analysis and from there, general financial modeling.
Cleaning Service Financial Model Template - Recurring Revenue Contracts and/or Flat Fee Jobs
I've done a janitorial cleaning financial model template in the past, but that was only geared toward hourly based billing and wages. This new model is for commercial or residential cleaning service businesses that operate with recurring revenue contracts and/or have flat fee jobs. All the assumptions are geared towards those revenue streams. You can create clean financial projections with ease by using this spreadsheet.
How Technological Advancements and AI are Effecting Accounting
Technological advancements, particularly in Artificial Intelligence (AI) and Blockchain, have brought significant changes and improvements to the accounting industry. These technologies are reshaping traditional accounting practices, making processes more efficient, secure, and transparent.
Valuation of a Private SaaS Business
Estimating the value of a private SaaS (Software as a Service) business involves considering a range of metrics that reflect its financial health, growth potential, market position, and operational efficiency. Some of the most important metrics to consider include:
Risk-adjusted Returns: Calculation and Usefulness
What Does Risk-Adjusted Return Mean?
Risk-adjusted return refers to the financial gains or performance of an investment, taking into account the level of risk that was taken to achieve these returns. It's a concept used in finance to understand how much risk is involved in producing a specific return.
Management Template: Pareto Analysis (80/20 rule)
Pareto Analysis, often referred to as the 80/20 rule, is a technique used for decision-making based on the Pareto Principle. This principle states that, for many events, roughly 80% of the effects come from 20% of the causes. In business and economics, it is used to identify the most important factors in a set of factors that contribute to a particular effect.
Financial Model Templates for the Most Profitable Businesses
The profitability of these industries can be attributed to a combination of factors that include market demand, specialized skills, and the nature of the services or products offered. Here's a breakdown of why these industries are considered most profitable:
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