Dear HN community,<p>For my internship i need to dive into the topic of financial modelling for a technical start-up. I would be very thankful if you could share some best practices in getting the assumptions right and building a financial model generally.
Anyone who is interested in some sort of chat on that topic is also very welcome, it would really help me out!<p>Thank you in advance!
I've made half a dozen or so very detailed models for varying start-ups and therefore have gone through the process a quite a few times.<p>1) Please make sure you understand accounting/finance (Income, balance sheets, cash flow, inventory, etc).<p>2) Who is your target: this determines how detailed, modifiable, and annotated the model should be.<p>3) Don't worry about the assumptions at first, just get best guesses and build it. Then when done hunt through available financial models to find comparable values. (Have all assumptions on 1-2 pages/sheets and nothing else, I usually have 1 for revenue assumptions and 1 for cost assumptions)<p>4) Make sales targets/growth easy to modify (in a separate table/sheet) so a statistical analysis can be completed easily if needed or different revenue models can be tested.<p>5) After you've made the model check your calculations by hand and make sure the values make 'sense'.
<a href="http://en.origoterra.com/2010/05/startup-financial-model-is-there-a-template/" rel="nofollow">http://en.origoterra.com/2010/05/startup-financial-model-is-...</a><p>This may be a good starting point.