A startup financial model is not just a spreadsheet for investors. It is a decision-making tool for founders. In India’s funding environment, where capital cycles fluctuate, investors expect discipline and clarity. A strong model shows how your startup scales, how long your runway lasts, and how much capital you need to raise.The key is to build it bottom-up using granular assumptions rather than broad market guesses. Investors rarely trust top-down projections. They want to see how revenue grows from individual customers, how costs scale with hiring, and how margins evolve over time.Your first model should project three to five years ahead, with monthly detail in early years and annual summaries later. The goal is clarity, not perfection.Start with assumptions, not formulasBefore building calculations, define your core assumptions in a dedicated input sheet.Clarify your objective. Are you modelling to calculate fundraising needs, manage cash flow, or plan hiring? Outline your market size using:Total Addressable Market (TAM)Serviceable Available Market (SAM)Serviceable Obtainable Market (SOM)Define your revenue streams, pricing, expected growth rates, hiring plans, and future funding rounds.Keep assumptions separate from formulas. If your conversion rate changes from 15% to 12%, you should be able to update one cell and see the impact across… Read MoreYourStory RSS Feed
