Numbers can tell a story too…
If you plan to raise money or recruit a team, there is one other goal of your financial plan. It needs to convince others that the business is viable, i.e., that it will ultimately make money without requiring an unreasonable amount of initial funding.
To do this, the financial plan needs to tell a good story. A clear, logical, believable story about your startup.
This may seem a lot to ask from a spreadsheet, as most of the stories we’ve read from childhood until now do not look like pages of numbers, but nonetheless, it is possible. I have told such stories myself, walking dozens of investors through my own startup financial plans.
The key is to put the items into a logical order and explain them step by step, so the story flows in a manner that others can understand, starting at assumptions and moving through to the projections.
The sample plan later in this book will demonstrate how to do this.
