Simple Startup Cashflow Projections • Hacker News Board

Re: Simple Startup Cashflow Projections

#21

Post by ynac » Wed, Jul 24, 2019, 5:36 AM UTC

BayezLyfe wrote: post #16

ynac wrote: post #4

Agreed! I swear by this type of cash-flow-pro-forma. It becomes a model for the business that you can share with anyone involved in the business (or would like to be involved). In some ways it becomes my simulation engine for the business. There are ways to alter the basic sheet for different purposes, but here are my basic add-ons or differences from the sendwithses.com version. My sheet has: * Metrics section at th…

Would love to see your version... do you mind sharing?

Good idea - I'll do a Show and Share within a week. I'm currently working two clients (one turnaround and one startup) through building this sheet, so I'll pay attention to the empty sheet and see how to make it more template-like.

Re: Simple Startup Cashflow Projections

#22

Post by mikeyouse » Wed, Jul 24, 2019, 7:17 AM UTC

m3kw9 wrote: post #19

Revenue can be recognized in the future and thus affect cash flow calc.

That won't really affect cash flow.. If you have to recognize 1/12th of an annual subscription every month for GAAP accounting, you still have 100% of the cash up front. Your monthly income statement will only show 1/12th of the revenue, but the balance sheet will have an accrued revenue liability equal to the remaining period while cash is just.. cash.

Re: Simple Startup Cashflow Projections

#23

Post by hipshaker » Wed, Jul 24, 2019, 9:03 AM UTC

lubos wrote: post #15

hencq wrote: post #12

Earlier quoted context omitted.

It's not though. For example, the hardware/software purchases in month 1 are an expenditure, but would likely be a depreciation expense over a period of time.

Can you give an example? In Australia, you'd need to buy hardware or software for more than $30,000 per unit to be forced to depreciate it over multiple periods. Anything cheaper than $30,000 can be expensed right away. So I'm looking at it through Australian optics and having "Hardware/software" under expenses would be fine for almost every small business here.

In Denmark, anything over 2000 USD has to be depreciated.

Re: Simple Startup Cashflow Projections

#24

Post by paul-gf » Wed, Jul 24, 2019, 12:21 PM UTC

tedsanders wrote: post #7

FYI, this spreadsheet does not use words like income, profit, loss, expenditure, etc. in the same way that businesses and accountants use the terms. Be very careful if you're communicating these numbers to other parties - they may not interpret the words in the same way you intend them. Example: Cash flow is not the same as profits/losses. If you buy a $1M CNC machine for $1M in cash, your profit is $0 but your cashf…

Thanks for pointing this out.

Really important to have a 3-statement model for your company, meaning a P&L (income statement), Balance Sheet and Cash Flow. This is especially important for companies with big gaps between cash collections and actually earning revenue (such as companies that collect annual contracts upfront but are earned monthly). We've seen a lot of companies trip up on this.

We have a free model on our website that has all three statements and is easy to use: https://www.graphitefinancial.com/open-source-financial-mode...