user manual
Contents
1. required depends on the value assigned to corporate tax rate in the Operating Assumptions box to the left Measures IRR for the project s Founders If there is no Total Project s IRR Se en m m o me e me meme mme mea meme me men mee mamn man m ma m eee Investor Deal assumed then Founders IRR would equal r I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I I a sa or or aor a nor na not na not a oat at HS I p I I I I I I I I I Li I I I I I I I I p I I I Li I I I I I I p I I I Li I I I I I I I I I I I l I I I Li I I I I I I I Li I I I I I I I I I I I I I I I l I I I I I I I I I I I I I I I I I I I I I I Li I I k Investor Return Measures IRR to Investor as a function of the project sold to Investor share of the project s Cash Flows and its Exit Value vs the amount of Investments put into the Company at Investor Deal Date Lee ee ee ee ee eee eee eee eee eee eek eee ee ee ee ee ee ee ee Funding Check Field Would turn red and show negative amounts if Investor Investment is not sufficient to bridge project s cash flows to break even However if there is a funding gap the Model would assume that any funding shortfall after the Deal Date would b2. step would set the timeline for your Model If you wish your free report and or paid for Model to measure IRR on going concern basis you can assign terminal exit value to your project Exit Valuation Driver can be set to Revenue Cash Flows or Customers You can select currency from the pull down list Manual entry is allowed for any currency for the paid for Model Currency Units are in By default the scale is in thousands or OOOs Note that this input is a simple label The Model does not self adjust scales assumed by users 1 I I E E E E E E E E EE E E ee ee E E F ee ee E ee E a gee a E Oe eT EE ee ae eet er EE eer e E EEEN EE e EE EE aE S E e E E E e E E R Ee E E E an eee E E E E E E eee a ep e e qn e e e e e e e ee ee a e eee Number of Periods in the Model is Can be set to any integer value between 3 and 60 By definition the combination of the number of periods and periods step would set the timeline for your Model Exit Driver Value is Assigns value to your choice of Exit Valuation Driver If you wish your free report and or paid for Model to measure IRR on projected cash flow basis only excluding any impact from Exit Value you can leave this variable equal to i zero as in default assumption Oe ee 2 2 Step 2 Inputting business assumptions and variables Step 2 requires entry of business and operating assumptions for your project The purchased copy of the Model allows cha
3. USER MANUAL QUICK IRR MODEL April 2014 Release Version 3 Contents k MUN OCI CO psa geese es E E E enero 3 1 1 General information about FinRObot cccceseesseeceeeceeeeeeseeeceeeeeeeeeeeeees 3 Wise ORO ALS FeO UI eI 10S siren constecetetos A eecanialiveaearseucetsious 3 1 3 Quick IRR Model functonalty cscebctanteecncesasthaias tes ascertasbcanterencesssesataatenascenystes 3 2 Inputting data when assembling the Model online sssnnnenssessssssennssssssssseerssssssssses 4 2 1 Step 1 Setting the Quick IRR Model s structure cccccccececeeeeeeeeeeeeeees 4 2 2 Step 2 Inputting business assumptions and variables ccccccceeeeeeeeeeeees gt 2 3 Requesting free model and purchasing Options cccccceesseesseeeeeeeeeeeeeeeees 7 3 Working with the Excel file of the Model ccccccssssssseeececeeeeeeeeseeecceeeeeeeeeeeees 7 3 1 Operating Assumptions DOX cccccccecsesssssessesessseessseessesesesesesesseeeeseeeseeeas 7 Mile V ALWALIOM Dashboard DOK pa asecen cn seg sgaceeseconen exaanasventcen E EEEa 9 Iae el CU AO A gsc cogs sce TR 11 2 Page Finrobot 1 Introduction 1 1 General information about FinRobot FinRobot is an automatic assembler of financial Models in Microsoft Excel It allows you to set online parameters for your project and download a financial Model with working formulae and input fields in Microsoft Excel When ordering your Model on
4. assembled and appear in your User Account available for download You will receive a notification via email that your model is ready You can always download a copy of your model from your User Account archive 3 Working with the Excel file of the Model Paid for version of the Quick IRR Model provides additional functionality and reports which are not available in a free version The free version will have these disabled and marked with blue shaded background You can also change certain non structural variables and assumptions entered during on line assembly stage as described below Please note that in the Excel file of the Model fields marked with yellow background are data input fields You can re populate these with your own data without any risk of altering the structural layout of the Model Nevertheless as it happens with financial and operating inputs these have to be meaningful in the context of your business For example negative customer additions would not yield a sensible IRR result 3 1 Operating Assumptions box In this area of the Model you can change business assumptions related to your project The Model will take care of the rest and will run your data through formulae and into the output reports and graphs An example of the Operating Assumptions box is provided below Full version 7I Page Finrobot Operating Assumptions H Model s Start Date Model Step Currency Corporate Tax Rate U
5. D 000s Investor Deal Date 00Jan00 Investor Return Co Valuation at Deal USD 000s gt gt IRR 00 Investor Invesment USD 000s gt gt Funding eS Implied Share Sold Capitalisation Pre reere reer re rrr terre rrr rrr rrr rrr rier errr rr errr rrr irre rr errr rr reer re rer rrr rerrr rrr rerrrrrererrrerer rrr rer rrrrererrrrrerrrrrererrrrrrrrrrrrrrrrr rrr rrr rrr rrr rr rr errr rrr errr rrr rrr rrr errr rr irri rire rer rrr rrr rerrrrirrerrrrrrrrr rr rrr rr rrrrrrtrrrrr irri itr The dashboard is an analysis tool as the Model reacts to changing assumptions and instantly recalculates IRR paybacks and other performance metrics The description of the input and output fields are provided in the table below square brackets denote part of the label dependent on currency and periods settings pee eee ee ee ee ee ee ee ee ee a ee ee eae ee ee ee eee ee ee eee ee ee ee eee eee eee ee eee eee eee eee ee eee eee eee ee eee eee eee ee eee eee eee eee ee eee eee eee ee eee eee eee ey Exit Valuation Driver If you wish your free report and or paid for Model to measure IRR on going concern basis you can assign terminal exit value to your project driven by revenue cash flows or customer metrics Ce en en ee en ee eee Exit Driver Value Assigns value to your choice of Exit Valuation Driver If you wish IRR measured on projected cash flow basis only excluding any impact from Exit Value you can set this variable equal to zero Finds p
6. e covered pro rata to ownership on when needed would not break but returns to Founders and Investors basis L ce a a eed denotes functionality only available in full version of the model 3 3 Calculation area The Model s calculations area is located below the Operating Assumptions and Valuation Dashboard boxes The end of the calculation area is marked with 11 Page Finrobot gt gt End of Sheet Users are not required to alter any of the formulae in this area However there are no hidden lines or complicated formulae If you feel comfortable with the data flow in these fields you can adjust the logic to better suit your project s environment as you see fit Please do not forget to make a copy of your Model before making any changes to the code 12 Page Finrobot
7. ecently tested our Models for Excel 2013 and found no immediate compatibility issues Please note that the Quick IRR Model has xlsm file extension allowing use of macro VBA code However there is no macro present in the file If you disable use of macro in your Excel settings the file will work properly 1 3 Quick IRR Model functionality Quick IRR Model allows users to perform back of the envelope IRR calculation for a new project By entering few parameters on line you can get an idea of cumulative funding required cash flow profile and expected returns for your new idea It is free To gain access to more functionality you can purchase the underlying Excel Model for a modest fee as advertised in our Tools section of the website Our Quick IRR Model allows you to 3 Page Finrobot e Choose your own calendar start and stop dates for the project monthly quarterly or annually e Assume time and investments required pre launch as well as the launch costs e Drive business s revenue by assuming customer acquisition retention variables and average revenue per customer e Calculate margins and venture s cash profile over time by assuming direct margins and overhead costs full version has three classes of overheads whilst free version has one e Introduce exit sale value assumptions to yield IRR on going concern basis e Perform IRR required funding break even and payback calculations e Differentiate investment ter
8. ed The Rate is expressed in annual terms For example if retention is 60 annually then 10 of your customer base will churn every quarter ep a ee ee ee ee eee ee ee ee ee eee eee Hy Direct Margin per Customer This input is an equivalent to Gross Profit margin that each customer delivers with each purchase The ratio excludes _ pre launch and launch costs as well as marketing and general overhead Peon eee eee ee ee ee ee ee ee ee ee ee ee ee eee pp ee eee ee eee eee ee eee ee ee ee ee eee ee eee ee ee ee ee ee ee eee eee ee ee ee ee ee ee eee eee ee ee ee ee ee ee eee ee ee ee eee ee eee ee eee The Model will evenly spread pre launch business development costs for your project between the Model s start date and up to the assumed launch date Launch costs USD 000 s Launch costs are a one off expense like promotions and marketing campaigns at launch and which are not expected to continue on regular basis Regular Marketing per Quarter As the name suggest this is your regular marketing budget to USD 000 s maintain assumed rate of new customer acquisitions Assumed to be fixed charges growing over time at assumed inflation rate Overhead per Quarter USD _ Allows to book general overhead expenses for your project 000 s such as rents personnel etc Assumed to be a fixed charge _ growing over time at an assumed inflation rate 1 1 1 Tei is a a ai sas is i i ni nl a a a a i i i i i ni i
9. eriod when cash flow break even is achieved based on Operating Assumptions inputs Calculates break even period when the project turns cash flow positive on cumulative basis based on Operating Assumptions inputs 10 Page Finrobot Founders Capital Pre Deal USD In absence of an Investor Deal Founders capital required 000 s would equal to the total funding needs for the Project If there is an investor deal the cell would calculate capital required to cover cash burn up to the Investor Deal Date Investor Deal Date Allows investors to join in the project company at any assumed date during the forecast period of the Model Co Valuation at Deal USD 000 s Sets Company value for a deal with investor This variable i and the amount invested by investor would set of the company sold to investor s Note this is a post money value PORES AE Investor Investment USD 000 s This is an input field e g not restricted to any value However logically the amount should correspond to funding required and Co s Valuation at Deal If there is no investor then the value in this field to zero Implied Share Sold Shows what of the Company is being offered to Capitalisation investor s to bring in required amount of proceeds Investments at given Co Valuation on post money basis Measures IRR for the whole project pre tax or post tax as
10. every quarter and 90 will roll over to be part of your active customer base going forward SlPage Finrobot This input is an equivalent of Gross Profit margin that each customer delivers with each purchase The ratio excludes pre launch and launch costs as well as marketing and general overheads pee eee eee eee ee ee ee ee ee RTT Be i Quarters to Launch _ Measured in periods of your choice this input sets the date 3 for the project s commercial launch Average Check per Customer This is the main revenue driver as it sets how much money USD each customer spends on your products or services in each forecast period It is particularly useful if you have more than one source of revenue associated with each active customer e g on line shop referrals or advertising Pre launch Development Costs The Model will evenly spread pre launch business USD 000 s development costs for your project between the Model s start date and up to the assumed launch date Launch costs are reserved for special one off launch related expenses such as launch promotions and marketing campaign and which are not expected to continue on regular basis et nn ee eee Regular Marketing per Quarter As the name suggest this is your regular marketing budget to _ USD 000 s _ maintain assumed rate of new customer acquisitions going forward Overhead per Quarter USD 000 s Allows modelling various fi
11. line sensitive financial data about your business does not need to be inputted if you prefer not to Your Model will be delivered with dummy financial data which can be replaced with your own inputs off line as needed Your Model can be further modified off line Unlike the black box solutions the code and type of formulae are intentionally simple and transparent Currently FinRobot provides three versions of the Model called Base Model Case Builder Model and Quick IRR Model This Manual describes the functionality of the Quick IRR Model To read more about our other Models please refer to their respective manuals available on line and as a download in pdf An initial understanding of the Model s layout and templates can be achieved by viewing screenshots of the Model from the Models section of our site Note that yellow fields are data input fields which can be re populated with data off line without any risk of unintentionally altering the functionality or structure of the Model Please ensure you make a back up after downloading your Model 1 2 Software requirements Our Models have been successfully tested for Microsoft Office Excel 2007 2010 If your installation of Microsoft Office is different you may wish to use free Microsoft Office converters However we do not guarantee that the Model will retain all of its functionality and graphical representations if opened in a different version of Microsoft Office We r
12. ms and returns for founders vs financial investors paid version only e Compare pre and post tax cash flows and returns paid version only e Differentiate inflation factors for individual revenue and cost items For further details regarding functionality of Free vs Full versions please read more below 2 Inputting data when assembling the Model online Once you are a registered and logged in user you can click Assemble button within the description box for the Quick IRR Model on the Models Tools page of the site Alternatively you can select Quick IRR Model by launching assembler from your User Account page The online assembly of the Quick IRR Model is completed in two input screens or Steps e The first Step as described below deals with the structural parameters of the Model Most of these cannot be easily altered once the Model is purchased See section 2 1 of the Manual for details e The second Step as described below allows for entry of business assumptions This data can be changed later off line See section 2 2 of the Manual for details Unlike other Models in our product range Quick IRR Model has a free version you can gain access to at the end of the assembly stage Click Request Free Model button to action the process The Model is free and does not require a purchase When assembling a model proceed to next Step by clicking on Next or return to previous Step by clicking Back Sa
13. nging any of these off line Please refer to section 3 of the Manual for more details 5 Page Finrobot Note that Step 2 field legends react to your choice of inputs from Step 1 For example if you configured the Model to be Quarterly USD and in 000 s legends for Step 2 would incorporate your choices as shown in the table below legends dependent on Step 1 are shown in square brackets At this Step you can Input field Comment Quarters to Launch Measured in periods of your choice this input sets the date for the project s commercial launch New Customers Acquired per Once the project is launched this input would set the rate at Quarter 000 s which new customers are acquired during each post launch forecast period Da a a eee eee eee eee eed Average Check per Customer This is the main revenue driver as it sets how much money USD each customer spends on your products or services in each forecast period This is particularly useful approach if your customers spend cash on multiple things or your business has multiple revenue sources from each customer activity e g subscription revenue and advertising revenue fan a n nnn n nena nnnnnnnnnnnnnnnnnnenaaennn nas Customer Retention Rate 1 Churn This is a very important operational metric for any customer driven business As customers are acquired some of them never return churn and some become repeat customers e g retain
14. ni a a i i i a ni an ms a mel Ti i i i i i i inr a i in i i i c a li k e dJ 6 Page Finrobot Inflation per annum This is a price indexing factor for both revenues and cost items expressed in annual terms For example if your Model is quarterly you do not have to apply a fraction of the annual growth rate the Model will do it for you automatically inserting 10 annual growth rate would translate in your revenues and fixed costs growing 2 5 quarter on quarter I l I I I i iii iii ii ii iii iii i i ee ii Ics iti il i li tisk ni indi a aii lia ii ik i lik in tiki ili al ii id iid ait ik ili dJ With completion of Step 2 you are done customising your Model You can proceed to model request and purchase options as described in section 2 3 of the Manual 2 3 Requesting free model and purchasing options After completing Step 2 you can click Next and select Request Free Model button The free model would be assembled and appear in your User Account available for download You will receive a notification via email that your model is ready Note that you can always convert any of your free or demo models stored in the User Account to full paid versions by clicking on Buy Model button next to its free demo listing Alternatively you can opt to purchase Full version of the model In this case the next screen will take you to the payment options Upon payment confirmation the full version would be
15. nits New Customers Acquired per Quarter Customer Retention Rate 1 Churn Yo Direct Margin per Customer User Quarters to Launch La OOM Consulting per Quarter Ln een Outsourcing per Quarter USD 000s Inflation pa Average Check per Customer USD Pretaunch Development Costs Launch costs Regular Marketing per Quarter Serer etre tere rere reeer reer reerre rete r rere rerer reer re rrreeerreter etree rere eer re rere rer eter etree irre tener recere rere treet ree rere ee ter treet eter reer eer teeter terete rere reer re erre terre terete rer ete err rer rrr re terre etree treet re rer ree tre ter etter tree rrr rer rer etree terete tree etre terete eter reer reer ree ee terete tree rere errr ee terete reer terete etree eee ener Free Version disabled options shown with blue background Direct Margin per Customer User Consulting i per Year Operating ASSUMp ONS llvet Models Start Date Model Step i USD 000s Inflation pa Currency USD Average Check per Customer USD Corporate Tax Rate Yo sae Sle eg Pre launch Development Costs Units 000s Launch costs New Customers Acquired per Year 000s eee Regular Marketing per ear i Customer Retention Rate 1 Churn per annum 80 Overheads per Year ae ee secu nrc Years to Launch per Year Terre ereerre tree eer rerret eer rrrterterrrerrer tree rrret rrr rrrrrtt rire teeter re rrer rrr erre
16. r reer errr errr eerer terre eererr rere errr iret errr rire e etre teeter rrr reet errr rere errr rree terre terre ree rerrr reer reer teeter reer trier errr tree errr rer terre teeter tre rree ter rrre rrr rrrer terre reer ere rrer ieee rre rrr errr rier terete tere tier eeerrrett eerie You can manipulate the following business data for your project legends dependent on other inputs are shown in square brackets New Customers Acquired per Quarter 000 s Customer Retention Rate 1 Churn Rt pe pp nt pt qa Comment You can change your Model s Start Date timeline will re calculate automatically It is a label field and you can insert any code or symbol Default value is 0 inserting a tax assumption would result in recalculation of all performance indicators such as IRR to post tax basis A EEEE AE IEE E NE EE E EEE E EA EAEE EE E E i By default the scale is in thousands or OOOs Note that this input is a simple label The Model does not self adjust scales assumed by users Sets the rate at which new customers are acquired during each forecast period Eta On Ie Ee Re AAS ee ee a ee ee This is a very important operational metric for any customer driven business As customers are acquired some of them never return churn and some become repeat customers e g retained The Rate is expressed in annual terms For example if retention is 60 annually then 10 of your customer base will churn
17. ve button remembers all entered data After saving you can leave the assembly Steps and continue later by clicking Continue button at the top of the User Account page If you wish to globally restore default dummy values for any Model navigate Back to Step 1 and click Restore Default button You can always refer to on line version of the Manual for more details by pressing the Help button 2 1 Step 1 Setting the Quick IRR Model s structure 4 Page Finrobot Step 1 configures key settings and parameters of the Model Note that your choices of language and timeline are structural and cannot be changed once the Model is purchased The following table summarise the choices available to users at Step 1 of the Model s online assembly pee eee ee ee ee ee ee ee ee ee ee ee ee eee ee eee eee eee ee ee eee eee eee ee eee ee eee eee eee ee eee ee eee eee ee eee eee eee eee eee eee eee ee eee eee eee ee eee eee eee ey Current available in English or Russian Note that switching Model s language would completely reset your language environment including entry forms and commentary fields The Model assembler would only allow a first date of any month to be the Model s start date Non conforming day of the month entry will automatically revert to the first day of the month chosen by user Period Step can be set to year quarter or month By definition the combination of the number of periods and periods
18. xed type of expenses on period by period basis You can re label each class of expenses to suit your project s specifics Consulting per Quarter your proj p USD 000 s Outsourcing per Quarter USD 000 s ee rrr fe rt mertce norte norte norte norte nortan norte nortan net ta nett net FSISeH RISE Se HSE SG Re HS He Inflation per annum _ These are price indices or inflation factors for revenue and cost elements You can differentiate cost inflation for each cost element or have revenue and cost inflation run at different rates Oe rr Le denotes options which are not available in free version 3 2 Valuation Dashboard box Valuation dashboard allows entering various assumptions related to funding and valuing your project The picture below shows full version Investor and Deal related parameters are disabled in Free version of the Model Full version 9 Page Finrobot Valuation Dashboard Exit Valuation Driver Exit Driver Value Break even achieved in 11 Quarters Total Funding Required USD 000 s Founders Capital Pre Deal USD 000 s Investor Deal Date Co Valuation at Deal USD 000 s Investor Invesment USD 000 s Implied Share Sold Capitalisation Free Version blue shaded areas denote disabled fields Valuation Dashboard a Se euma EEE EE ie ane e 3 Exit Driver Value Break even achieved in 3 Years Total Funding Required USD 000s Founders Capital Pre Deal US
Download Pdf Manuals
Related Search