Cosatu Growth Path and Economic Transformation - Chris Malikane
Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley...
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Transcript of Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley...
![Page 1: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/1.jpg)
Surviving the First Year:Cash Flow & Budget Planning
Bentley Growth Management, LLC
Chris [email protected]
610-247-4110
Bentley Growth Management, LLC
![Page 2: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/2.jpg)
GREAT IDEA
STRONG MISSION
SUFFICIENT MARKET
VIABLE BUSINESS MODEL
Bentley Growth Management, LLC
![Page 3: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/3.jpg)
EXIT
PROFITABILITY SCALABILITY
MARKET
COMPETITIONTEAM
DEMAND
![Page 4: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/4.jpg)
Why Start-ups are Different No History
Use comparables Requires bold assumptions
Should be backed interviews State all assumptions Test what happens when you are wrong
Break business down to the key dials that control outcomes Growth Costs Timing
Bentley Growth Management, LLC
![Page 5: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/5.jpg)
Key Controls Growth
Number of customers Number of users Number of distributers
Costs Commissions Capital expenses Material Marketing
Timing Customer norms User / payer dynamics Timing of cash
Bentley Growth Management, LLC
![Page 6: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/6.jpg)
How to build a budget The relationship between revenue and expenses is developed through an
iterative process: Market research in identifying the market Understanding of the value proposition of the offering Understanding the channels of distribution Reasonable general and administrative costs
Steps Predict revenues Predict COGS Predict sales and marketing costs Predict start-up costs (where appropriate) Predict fixed and variable operating (non-production) costs Sensitivity analysis on line items Sensitivity analysis on the entire Pro Forma
Bentley Growth Management, LLC
![Page 7: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/7.jpg)
Sales process, channels, cycle What is the process by which buyers buy?
Direct○ Outside sales force○ Internal sales force○ Web or catalogue○ Bidding
Distributors VAR’s System Integrators Partnerships (?)
Sales cycle: How long does it take to decide Meet Educate Propose Decide
Bentley Growth Management, LLC
![Page 8: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/8.jpg)
Costs notes One line summary of every general and administrative cost,
with accompanying notes Repeated for a minimum of a three year period Include:
H/R costs- fully loaded Marketing costs Infrastructure costs Outside consultants and special project costs Does not include adjustments, investment interest, taxes or misc.
charges
Bentley Growth Management, LLC
![Page 9: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/9.jpg)
PROFIT & LOSS STATEMENT
FINANCIAL PROJECTIONA UNITSB PRICEC=AXB SALESD COGSE=C-D GROSS MARGINF OPERATING EXPENSEG=E-F EBITDA
Bentley Growth Management, LLC
![Page 10: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/10.jpg)
MARGINGROSS MARGINS REVEAL HOW MUCH A COMPANY EARNS TAKING INTO CONSIDERATION THE COSTS THAT IT INCURS FOR PRODUCING ITS PRODUCTS AND/OR SERVICES.
Bentley Growth Management, LLC
![Page 11: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/11.jpg)
EXAMPLEHIGH GROWTH COMPANY$20 SALES$10 COGS$200 OP EXP
Bentley Growth Management, LLC
![Page 12: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/12.jpg)
EXAMPLEHIGH GROWTH COMPANY$20 SALES$10 COGS$100 OP EXP
Bentley Growth Management, LLC
![Page 13: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/13.jpg)
EXAMPLEHIGH GROWTH COMPANY$20 SALES$5 COGS$200 OP EXP
Bentley Growth Management, LLC
![Page 14: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/14.jpg)
Dynamic Analysis Evaluate Strategic Options
Enter into two markets simultaneously or phased entry Risk / Reward Analysis
Sales projections off by 50% Sensitivity Analysis
Adjust inflation assumptions from 3-5% Long term growth Conversion rates
Bentley Growth Management, LLC
![Page 15: Surviving the First Year: Cash Flow & Budget Planning Bentley Growth Management, LLC Chris Bentley chris@bentleygrowth.com 610-247-4110 Bentley Growth.](https://reader036.fdocuments.us/reader036/viewer/2022062321/56649edb5503460f94bead8f/html5/thumbnails/15.jpg)
Thank You!
Bentley Growth Management, LLC
Bentley Growth Management, LLC
Chris [email protected]
610-247-4110