Basic Financial Modeling Template (Excel)

This spreadsheet template helps you create a practical financial model with a small number of key hypotheses. This template represents your business model as inputs and outputs so you can predict if your business is sustainable. 

When to Use It

Use the Basic Financial Model Template when:

  • You are being asked to predict financial outputs far into the future and you have no basis for creating estimates
  • You are being asked for a projected Profit & Loss Report (or Income Statement) for an early stage project with high uncertainty
  • You want to understand the drivers and limits of your business growth
  • You need to calculate success or fail metrics for experiments that will impact your financial performance
  • Someone has started babbling about needing to see your Balance Sheet, Cash Flow Statement, asks you about your COGS, or some other technical accounting term you’d prefer not to know exists


Who Should Use It

This is a good tool for teams that struggle to constantly optimize conversion rates without understanding the financial impact of those conversion rates, or anyone who want to turn basic dashboard metrics into a financial model. Use this template when you want to see if the growth of your business model will meet the scope of your ambition.

How It Works

Basic Financial Modeling Template (Excel)

 This is a relatively simple spreadsheet that represents your business model hypotheses as a financial model and shows you if your business will grow or not.

  1. Start with a visual representation of your model to make sure the logic makes sense.
  2. Estimate the key hypotheses of your financial model.
  3. If your model has additional hypotheses such as multiple Acquisition metrics, the spreadsheet can be modified manually.
  4. If your model’s Retention of Referral loops do not correspond to the spreadsheet, it must also be modified manually.
  5. Use the graph to determine if the financial model has No Growth, Limited Growth, Linear Growth, or Exponential Growth.
  6. Manually adjust hypotheses to perform a basic sensitivity analysis and determine the most significant factors that influence growth.
  7. If the desired growth is known, adjust hypotheses to determine what conditions will lead to the desired growth rate and use them as success / fail conditions for experimentation.


Authors and Contributors

Tristan Kromer

Tristan Kromer works with innovation teams and leaders to create amazing products and build startup ecosystems. He has worked with companies from early stage startups with zero revenue to enterprise companies with >$1B USD revenue (Unilever, Swisscom, Salesforce, Fujitsu, LinkedIn).

Have a Question?

Ask us anything.

Kromatic offers more than 300 innovation resources including frameworks, templates, articles, videos, and workshops to accelerate your project.

Browse Innovation Toolkit »