Financial Plan: Start With Assumptions, Not Spreadsheets

Many financial plans look precise even though the core assumptions are unclear. Decimal places do not help when plausibility is invisible.

Start With the Unit Sold

What is actually sold?

• license per team
• monthly fee per location
• transaction fee
• program package
• freemium with later upgrade

Without a clear unit, revenue assumptions stay arbitrary.

Revenue Drivers

Most early revenue models need only a few drivers: reachable customers, conversion, price, churn or repeat purchase and ramp-up over time.

Review question: which of these assumptions is evidenced, and which is only estimated?

Separate Cost Types

Fixed costs exist regardless of growth: salaries, base software, rent, insurance, baseline marketing.

Variable costs grow with usage or customers: hosting, support, payment fees, external services or material costs.

Liquidity Is Not Profit

Ask when money comes in, when costs are paid, whether pre-financing is needed and what happens if sales move slower than expected.

A good financial plan shows uncertainty: base case, cautious case, optimistic case, critical assumptions and open evidence.