Pro Forma Template for Startup

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Pro Forma Template for Startup

Master Financial Forecasting for Startups with Our Pro Forma Guide. Learn how to create robust projections investors and lenders look for.

Pro Forma Template for Startup

Master Financial Forecasting for Startups with Our Pro Forma Guide. Learn how to create robust projections investors and lenders look for.

Join 15,000+ founders and consultants who have used our free resources and tools

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Startups are known for their agility, innovation, and growth potential. But to gain traction – whether it’s winning investors, procuring loans, or meticulous strategic planning – they need solid financial forecasts. Enter the 'Startup Pro Forma'.

In this guide, we will thoroughly delve into the topic and cover the following points:

What is a Startup Pro Forma?

A "pro forma" in the context of startups refers to a financial document or set of financial statements that projects the future financial performance of a company. "Pro forma" is Latin for "as a matter of form" or "for the sake of form". In the business world, pro forma has come to mean a presentation of financial data that emphasizes certain calculations or projections.

What should be included in a Startup Pro Forma?

Income Statement Projections: This provides a projected profit and loss statement, outlining anticipated revenues, cost of goods sold, gross margin, operating expenses, and net income or loss.

Balance Sheet Projections: A projected snapshot of a company's assets, liabilities, and equity at a specific future date.

Cash Flow Statement Projections: This shows how much cash the business expects to generate and use over a projected period.

Break-even Analysis: This calculates the point at which total revenue equals total costs, indicating when the startup will start to be profitable.

Assumptions: These are critical and must be clearly stated. They provide the rationale for the projections. For instance, a startup might assume a certain growth rate based on market research or a certain cost structure based on supplier quotes.

What are investors and lenders looking for in a startup pro forma?  

Revenue and Sales Growth: Investors and lenders want to see a clear and realistic projection of the startup's revenue and sales growth over a specific period, usually three to five years. This helps them assess the market potential and the startup's ability to capture market share.

Profitability and Margins: Pro forma statements should include projections for gross profit margins, operating margins, and net profit margins. These margins help investors and lenders evaluate the startup's pricing strategy, cost control measures, and overall profitability.

Expenses Breakdown: A detailed breakdown of expenses is crucial. Investors want to see that the startup has a clear understanding of its operating costs, including fixed and variable expenses such as salaries, marketing, rent, utilities, and more.

Cash Flow Projection: Cash flow projections indicate how money will flow in and out of the startup's operations. Investors and lenders are interested in understanding the startup's ability to manage its cash flow, cover expenses, and invest in growth opportunities.

Capital Expenditures: Startups may need to invest in assets like equipment, technology, or facilities. Investors want to know the projected capital expenditures and how they align with the startup's growth strategy.

Assumptions and Rationale: The assumptions behind the pro forma projections are critical. Investors and lenders want to understand the logic and reasoning behind the numbers. Clear and transparent assumptions lend credibility to the projections.

Break-Even Analysis: A break-even analysis can demonstrate the point at which the startup's revenues will cover its expenses. This helps investors and lenders gauge how long it will take for the startup to become financially self-sufficient.

Market Opportunity and Competitive Landscape: Pro forma statements should be accompanied by a description of the startup's target market, its value proposition, and an analysis of the competitive landscape. This contextual information helps investors assess the startup's potential in the market.

Risk Factors: While not always included directly in the pro forma, it's important to address potential risks and challenges that could impact the startup's financial projections. Investors appreciate a startup that acknowledges and addresses risks.

Free 1-Year Start-up Pro Forma Template

For startups looking to get a leg up on their financial forecasting, we have a treat for you. Introducing our 12-month Pro Forma template – and the best part, it's entirely free! Here's what you can expect from this comprehensive tool:

Startup Pro Forma Input Examples

Below you will be able to see examples of the input tabs for startup costs, fixed assets, revenue, operating expenses and salaries. 

Sample Startup Cost Projections

The assumptions section of the start up forecast will encompass general presumptions and startup expenditure, including fixed assets like facilities, machinery, enhancements to leased properties, and vehicles. Additionally, this input section accommodates startup cost estimates such as initial inventory investments.

Illustrative 12-Month Revenue Projection

Within the revenue assumptions section, you can create forecasts regarding customer counts, the products or services they acquire, associated pricing, and the proportion of total units sold attributed to each offering. Presented below is a concise exemplar of our revenue forecasting framework:

Startup Operational Expense Forecasts

Input your startup's projected operating expenditures in the provided table. This feature enables the inclusion of expenses as either fixed monthly costs or as a percentage relative to generated revenue.

Exemplary Startup Salary Prediction

The final input segment pertains to salary predictions. Here, you can establish salary figures, employer-related taxes, benefits, commencement and cessation months for employees, and the employee count per category.

Startup Proforma Output Template Illustrations

Our complimentary financial model spreadsheet generates 12 months of projections for income statements, cash flows, and balance sheets. Provided here are instances showcasing these outcomes, along with fundamental charts and graphs that will be incorporated.

Sample 12-Month Pro Forma Income Statement

Displayed is a prototype of our pro forma income statement output, offering insight into the financial outlook:

Cash Flow Projection Example over 12 Months

The subsequent illustration outlines the cash flow projection output, encompassing cash flows from operational activities, financing endeavors, and investment undertakings.

12-Month Balance Sheet Projection Illustration

The balance sheet projection output spans an annual timeline, detailing the forecasted assets and liabilities, as depicted below:

Pro Forma Graphical Representations

Included within our complimentary template are visual aids such as an overview of profit and loss, a monthly sales forecast, and a graphical depiction of monthly sales, gross profit, and net income.

If you require a template that's better suited to your industry and includes projections for five years, we offer a selection of 100+ distinct industry templates for you to choose from.

Examples: Restaurant, Trucking, SaaS, Airbnb, Brewery, Dentist, etc.

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