3. Your
Dashboard
How much
money do I
have?
How much
money do I
need?
How much
money am I
making?
How much
money am I
spending?
How much
money am I
keeping?
4. Profit is not sufficient
but it is absolutely
essential
5. You are tracking two things
Assets
•What you
have
Liabilities
•What you
owe
7. The Balance Sheet = GPS Current Position
Cash
Accounts Receivable
Inventory and Equipment
Equipment
ASSETS (WHAT YOU HAVE) LIABILITIES (WHAT YOU OWE)
Short-Term Liabilities
Accounts Payable
TOTAL LIABILITIES
EQUITY (WHAT YOU INVEST)
Owner’s Equity
Retained Earnings
TOTAL EQUITY
Long-Term Liabilities
TOTAL ASSETS TOTAL LIABILITIES + EQUITY
Other Assets
TOTAL ASSETS MUST EQUAL TOTAL LIABILITIES+EQUITY
8. The Income Statement = Odometer
SALES
Less: Cost of Goods Sold
NET SALES
EXPENSES
INCOME STATEMENT FOR THE PERIOD 1 JANUARY TO 31 DECEMBER
EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION, AMORTIZATION (EBITDA)
Salaries
Rent
Marketing
TOTAL EXPENSES
Interest, Taxes, Depreciation, Amortization
NET INCOME
$100,000
$45,000
$55,000
$30,000
$10,000
$5,000
$45,000
$10,000
$3,000
$7,000
9. Cash Flow Projections = Speedometer
Number of units sold / customers
Total Billings
CASH OUT
Capital Expenses
CASH IN
Inventory and Supplies
Operational Expenses
Salaries
Rent and Utilities
Marketing
Development
Total Expenses
NET CASH FLOW
MONTH 1 MONTH 1 MONTH 1 MONTH 1 MONTH 1 MONTH 1 YEAR 1
10. Telling Your Story
• Numbers Tell A Story
• Your Assumptions and Hypothesis give CONTEXT
• List all your Assumptions and Hypothesis
• “We assume that a customer will purchase on
average 1.5 pairs”
• “We assume that a customer will come back
three times a year”
• “We assume that a designer costs _____”
11. For a
startup at
the
DEFINITION
stage
• Can your business make money?
Focus on the Cash Flow Statement
• 6 months month-by-month
• Then cumulative for the first year
SHOW
• All your hypothesis
• All your assumptions
LIST
12. Include in your Final Presentation
A Cash Flow Projection (1 year)
A list of your main hypothesis and assumptions
Don’t go too much in detail
Bottom line
decision
Do you believe that this idea is worth
developing to the next stage?