Generated a detailed 5 year financial projection model. We worked with the company’s management to develop a model that estimated the expected revenues and expenses the company would incur over the next 5 years. These projections incorporated new products and service offerings, as well as additional employee hires.
Determined they would require additional capital even after reaching profitability. Often profitability can be achieved prior to the company becoming cash flow positive. This is typical for early-stage companies, or companies in a high growth mode. In order to support their rapid growth plans and not run out of cash, we determined the company would require additional capital to last until they become cash flow positive.
The financial model identified the company’s capital requirements, which were 50% higher than they had initially anticipated. Knowing the true capital needs allowed the company to raise the appropriate amount of capital required to support their growth plans.
The Persuader Version 2.4