1 / 24

BUSI 701 Artistic Entrepreneurship

BUSI 701 Artistic Entrepreneurship. Intro to Financials. Agenda. 3 Steps to Financials Sources of Funding. Goal of Financials. Is venture viable? How much $$ will it take to get there? How will we monetize and distribute the value we create?. Goal of Financials. Viability Start-up cost

kevin-blake
Télécharger la présentation

BUSI 701 Artistic Entrepreneurship

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript


  1. BUSI 701Artistic Entrepreneurship Intro to Financials

  2. Agenda • 3 Steps to Financials • Sources of Funding

  3. Goal of Financials • Is venture viable? • How much $$ will it take to get there? • How will we monetize and distribute the value we create?

  4. Goal of Financials • Viability • Start-up cost • Return

  5. 3 Steps for Financials • Business model / back-of-the-napkin snapshot • Startup costs and projections • Financial statements

  6. Step 1: Business Model • Revenue model • Pricing • Implementation/roll-out strategy • Marketing • Small changes in strategy can profoundly effect financials

  7. Example Revenue Models • Retail store • E-store • B-to-B products or services • Consulting • Recurring fees • Membership • Software as a service • Razor/blade or printer/cartridge • Transaction fees

  8. Step 1: Business Model • Refine your businesss model and revenue model while doing research • Start with simple spreadsheets and get more complex as you get more comfortable with your strategies • Slight changes in strategy can totally change your financials dramatically

  9. Step 1: Napkin Snapshot • Very simple viability test: income - revenue • Assume that you are in full production, things are going great • Create sub-spreadsheets for “unit economics” and “key drivers” • This gives you a snapshot to see how profitable it could be • CCBackofNapkinFeasibility.xls

  10. Cost Drivers • Salaries • Rent • COGS • Fixed vs. variable costs • Equipment • Insurance, legal, etc. • Make sure you are in line with industry

  11. Step 2: Start-up Costs and Projections • Add start-up and projections • This gets very complex very quickly • Better to build your own rather than use template, but they are available • Must factor in loans and/or other financing • CC Simple Projections.xls • TIP: rent all the big items (buying is complicated)

  12. Step 3: Financial Statements • Don’t attempt these until your business model is finished! • You will likely need a template or a CFO to get these. • Income Statement • Balance Sheet • Cashflow Statement

  13. Recap: 3 Steps for Financials • Business model / back-of-the-napkin snapshot • Startup costs and projections • Financial statements

  14. Agenda • 3 Steps to Financials • Sources of Funding

  15. Sources of Funding • You and everyone you know • “Skin in the game” • “Family, friends and fools” • Doctors

  16. Other Sources • Revenue • Loans • Grants • Angels • Venture Capital (VC) • Private Equity • IPO

  17. Revenue • “Retained Earnings” • Means $$ that you earn is used to grow business • Generally implies slow, steady growth slow, steady growth

  18. Loans/Debt • Generally from banks • Must have or be purchasing assets as collateral with low LTV ratio • Real estate • Machinery/equipment • Accounts receivable • SBA (Small Business Administration)

  19. Debt (con’t) • Don’t be overly debt averse • Debt is great tool for creating value • Bankruptcy is also a great tool (compared to debtors prison) • “Convertible debt” converts to equity

  20. Grants • “Free” money • Do not undervalue the cost of time and reporting • Students: akin to researching and applying for scholarships

  21. Angels • Overused and misleading term • Don’t underestimate time in searching • Most angels these days are VC focused (implies super-fast growth, high tech)

  22. Venture Capital (VC) • Equity = you are selling % of your company • Price is negotiable, but VCs tend to hold the cards • “Institutional” money • Must be superfast growth • Most expensive way to create value • Don’t underestimate risk of losing control

  23. Private Equity • “Later stage” than VC • PE are money guys, VCs are startup guys • Back in the ’80s this was called LBO • Akin to house flippers

  24. IPO • Initial public offering = “going public” • Like venture capital, selling % of company • Once public, the market decides the price

More Related