A business model is scalable when it becomes increasingly profitable as the business grows. In order to do this the expenses and therefore the break even point of the business must remain stable or grow at a slower rate than revenue.
This free Excel pre money post money valuation spreadsheet uses the amount of equity investment required by a startup and the equity percentage negotiated with an investor to calculate the post money valuation and the pre money valuation of the business.
Business growth and expansion can be either organic or external in nature. External growth requires the business to merge with or takeover other businesses either by vertical integration up and down the supply chain or horizontal integration across the supply chain.
The business life cycle model uses 4 stages start-up, growth, maturity, and decline to define the different phases a business will experience in its lifetime. Each stage comes with its own characteristics and problems to solve, and the business must determine which stage has been reached in order to be able to plan and forecast effectively.
This free startup exponential growth calculator can be used by a business to help forecast its future revenue or in the absence of revenue, another parameter such as active users.
The calculator assumes a constant compound growth rate and is for use during the period of rapid growth a business experiences in its startup phase.
Crowdfunding is a technique for a business to obtain finance in which small amounts of funding are raised from a large number of people (the crowd). Crowdfunding can be either rewards, debt or equity based depending on the requirements of the business.
Programs such as Dragons’ Den and Shark Tank have highlighted the need for an entrepreneur to know their numbers and provide a reasonable startup valuation when seeking investment for a startup business and preparing for a shark tank or dragons’ den type pitch.
Developing a business plan and financial projections does not have to be a difficult task, the simple business plan tells a story. To help you appreciate the importance of a business plan and financial projections, we’ve set out below a number of reasons why they are necessary and the type of business situation they can be used for.