Download - ECRDA: Loan officer training - Session 3
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Assumption based financial models
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Assumption based financial models
• The goals is to learn and adjust the financial model “Learn as you go”
• Define the key assumptions underlying the financial model
• What MUST be true for the business to reach it’s financial forecasts
• What experiments or information must be gathered to prove the financial model
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Rate of customer acquisition
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What are the metrics that matter? (15 mins)
• Speed of acquiring parking lots?
• Average parking lots per new customer?
• Reservation per parking lot?
• No. of reservations?
• Reservations per parking lot / year?
• Gross margin per reservation?
• Web server costs?
• Website production costs?
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What are the metrics that matter?
• Speed of acquiring parking lots?
• Reservation per parking lot?
• No. of reservations?
• Reservation per parking lot?
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Why investment readiness level?
• Goal for entrepreneurs
• Common language for investors and entrepreneurs
• A gauge to inform investment decisions
• Data that entrepreneurs need to collect
• Adapted to fit each industry
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Therapeutics
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Digital health
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Diagnostics
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Microsoft – Investment readiness
ID assumptions, Competitive analysis, Tech skills
Execution ability & Coachablility
Find early adopter customer
Optimise messaging
Price testing
Build MVP
Customer satisfaction and retention (NPS)
Scaling costs (CAC)
Full assumption based financial model
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Design an investment readiness scale for your industry
• Form relevant groups of 4 to 6 loan officers
• What does an investment readiness scale for your industry look like?
• What key data do you need from entrepreneurs?
• What are the metrics that matter?
• Choose a presenter
• Prepare a 2 minute presentation
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Tea Break