INDUSTRY INSIGHTS YOUR PEERS ARE READING
One observation that I made recently is the discovery of the most incorrectly forecasted number. I’ve now been through a bunch of board meetings at a variety of different startups. The typical meeting goes through the plan and compares to actual and we all review where the company is ahead or behind plan. It’s not revenue, traffic, conversion rates or anything like that. It’s headcount. Almost all startups I’ve seen overestimate their hiring needs and under-hire against plan. MORE
Management budget forecast metricsAs we head into 2017, I have a steady stream of operating plans hitting my inbox. Since many of our investments are companies that are scaling, vs. companies that are just getting started, there are a lot of derivative metrics in these plans. Q1 is the easiest quarter to make your plan, so most of these companies are getting a free pass for the next three months after fighting the good fight of making or beating plan in Q3 and Q4. MORE
I don’t believe the forecast you show me. Ok, so far I’ve told you the forecast I’m looking at during fundraising is a lie and the one you’re using during initial iteration is a trap. So when is the right time for a startup to build a forecast that actually starts measuring the health of the company? The earliest a company should “manage by forecast” is post product/market fit and the absolute latest is at Series A fundraise. MORE
Market research companies like IBISWorld forecast an increased demand for insurance coverage in 2012, but by the same token, insurance buyers are expected to be increasingly selective on the plans they purchase. Sites like InsuranceQuotes.org and others of a similar breed are widely used by insurance shoppers to compare plans and find both what is right and most cost-effective for them. However, where does that leave the hard-working insurance sales agent? MORE
Most aspiring entrepreneurs understand that you can’t build a business if you won’t commit to delivering a product or service, but many are hesitant or refuse to commit to any financial forecasts. Forecast sales-volume expectations. entrepreneur financial forecast investor startup MORE
During the year, if the forecast revenues fall short or are greatly exceeded, it is fair to revise the budget and rethink hiring and resources. Otherwise, it is the expectation of the board of directors of a company that each year’s budget be approved in advance and adhered to as long as revenue goals are met. [Email readers continue here.] Note that I used the term “forecast” for revenues for the next year. MORE
Remember, there is no single way to forecast any business. Magda was looking at forecasting sales for a small restaurant. The point of this example is simply that Magda has to find a way to make sense of her forecast. And now her sales forecast is up and running. MORE
There are many techniques and time horizons for forecasting cash. For those companies with constant billings to customers during a month, and for those with extra large fixed costs such as payrolls at periods during a month, it is important to begin the discipline of the 13 week rolling forecast as a tool for finding and planning around short term cash problems. Each week, the actual cash position is updated and the past week dropped from the forecast and a new week added. MORE
Creating financial forecasts and budgets are not typically how many entrepreneurs envision spending their time, but these tools are incredibly necessary. An accurate and thoughtful forecast can be time-consuming, but it will help you to make informed decisions regarding staffing and growth, and it will help you attract investors. Here are tips to create a practical and well-rounded financial forecast for your startup. The value of a forecast. MORE
So for me, what makes a sales forecast credible? I want to see a sales forecast with drivers. Well then, that helps makes a sales forecast credible. More often than not, the problem with unrealistic profitability is, it cuts into the credibility of your sales forecast. MORE
Remember, there is no single way to forecast any business. Magda was looking at forecasting sales for a small restaurant. The point of this example is simply that Magda has to find a way to make sense of her forecast. And now her sales forecast is up and running. MORE
” I hung in there in this case and continued to make my point about playing offense on sales forecasting. Why is accurate sales forecasting such a challenge? Sales forecast pipelineI got an email today from an exec at a company who I was with at a recent board meeting. I thought it was a powerful summary of part of our discussion, specifically around the sales pipeline for Q4 and overall sales execution. MORE
Sales forecasting is much easier than you think, and much more useful than you imagine. You review and revise your forecast regularly. Since sales are intimate with costs and expenses, the forecast helps you budget and manage. And that’s a sales forecast you can use. MORE
He said, “I insist on getting weekly status reports with forecasted deal size and probability of close. If the answer is no, you have absolutely no customers on your forecast who will be prepared to buy from you in the next six months.”. The Phantom Sales Forecast. MORE
They not only hit their respective forecasts set early in the year, but they beat them. More importantly these numbers speak to the commitment of the respective teams to do anything possible to deliver on the Q3 forecasts. The post Delivering on Q3 forecasts! I received some incredible news last night from two portfolio company CEOs updating me on our Q3 numbers. MORE
Using your data, here are the basic elements of the projection process, which are measurable by milestones, and can be tracked to show when a re-forecast is required: Start with sizing per-unit profitability. This forecast is really their commitment. Plan to re-forecast every quarter. MORE
Good VCs need to be good forecasters. Deloitte have just published an interesting synopsis of Tetlock’s Superforecasting which gives us some insights into the types of people we need to recruit and the habits we need to cultivate to be good at the forecasting game. cautious in their forecasts. I’m not saying I’m a super forecaster, but I did learn from that and backed off from mobile until after the iPhone. MORE
Here are 7 ways forecasting software can improve your business. Finance Grow forecasting money. cash flow MORE
When it comes to starting and managing a business, forecasting your sales is essential. Having a sales forecast can help you budget and manage your business’s funds, create a plan for expansion, and avoid unpleasant surprises. The basics of sales forecasting. MORE
The key to creating your revenue model is through forecasting—that is, projecting revenue estimates, even if you’re currently pre-revenue. Forecasting is an ongoing process that will help you to manage your cash and continue to grow. There are two general approaches to financial forecasting: top-down and bottom-up forecasting. Originally published in AffinityLive. MORE
So, was the forecast accurate? Does that mean the forecast was inaccurate? How do you hold forecasters accountable, when the forecast is only a probability? The forecast is what chance this lead has of converting, or what dollar value it has. MORE
eMarketer are predicting that YouTube revenues will hit $5.6bn this year, 50% up on last year (reported in the Guarian ). Here are some other relevant facts: Projections of YouTube’s revenues are increasing over time – in May Morgan Stanley were predicting $4bn. MORE
Why should I build a financial forecast for my fundraising presentation? This is one of the most common reactions we get during a pitch when we ask about a financial forecast. Andrej Kiska is an Associate at Credo Ventures. MORE
If your business is building a subscription service, creating a reliable sales forecast is a critical step to understanding how your business will grow and what the key drivers of revenue growth will be. Now it’s time to build a forecast. We’re living in a subscription world. MORE
Second, skip everything else you’ve heard people talk about and jump right into your sales forecast. I just finished an initial sales forecast for our new product Outpost , and am going to share the process I went through to put it together. This really helped me jump-start my forecast. MORE
New forecasts out from Forrester predict that online retail sales in the US will be $294bn this year, rising to $414bn by 2018. The growth rate from 2013-2018 is forecast to be 9.5%. MORE
When I asked the standard “How are you,” he answered: “If I see another hockey stick forecast this week, I’m going to throw something at somebody.”. ” See Also: How to Forecast Sales. Sales forecasts should rest on assumptions. MORE
Besides the general focus on customer and product development, an entrepreneur should foresee the next moves that will serve to guide him on the right path.When an entrepreneur can forecast his next moves, even his/her employees become part of the moves the business makes. MORE
For the record, we could call it an expense forecast, or projected expenses. Those go in your sales forecast. The illustration here shows a sample expense budget from the same bicycle business plan I used in the previous article how to forecast sales. MORE
First, allow me to deal with a very common problem: Business owners are often afraid to forecast sales. And that also means you should not back off from forecasting because you have a new product, or new business, without past data. That makes forecasting easier. MORE
July 24, 2016: Last week’s essay dealt with the fine art of pricing your startup product or service. Pricing is inextricably tied to your… Continue reading on Austin Startups MORE
Moreover, their star is rising, according to Forbes a year ago eMarketer was forecasting Twitter’s 2014 revenues at $540m, 43% less than the $950m they are now forecasting. I have been wondering lately how Twitter was getting on. MORE
By Jessica Oaks. A new year brings with it the hope of better things to come. The past year saw some radical developments in social media – witness the rise of Vine and Snapchat – and 2014 looks to promise more of the same. Below are some social media predictions for the coming year. MORE
Whether your business is brand new or it’s been around for a while, you’ve probably thought about putting together a financial forecast. But how do you know if your forecast model is reliable? What is forecasting? How is forecasting different from budgeting? MORE
revenues because growth is much lower – forecast at 5-7% next year, and their EBITDA margin is 8%. Mahesh Vellanki from Redpoint put up an interesting post yesterday about ecommerce valuations. MORE
Just do a sales forecast, which means you aren’t doing text, editing, or a document, just good management. Step one: The first forecast. A useful sales forecast is a lot easier than most people think. MORE
The illustration here shows a sample cash flow based on the same numbers in two previous posts, how to forecast sales and how to create an expense budget. Vital as this is to business survival, it is not nearly as intuitive as the sales forecast, personnel plan, or income statement. MORE
With restaurants, as with most businesses, there is no single right way to do a sales forecast. The best sales forecast method will vary according to how you manage information, how much past data you have access to, and what special factors drive your business. MORE
Do we rely upon constant changes and call it a forecast? But during the year, if the forecast revenues fall short or are greatly exceeded, it is fair to revise the budget and rethink your hiring and resources. Hold it! These are confusing terms. When does a budget become obsolete? MORE
Austin Technology Austin Capital Factory Forecast Hurricane Party Rene Pinnell startup app technologyThe Austin-based startup Hurricane Party received all kinds of attention at South by Southwest Interactive 2011. Mashable wrote about them. So did Read Write Web. TechCocktail labeled Hurricane Party the hottest app of 2011 at SXSW. Hurricane Party was a mobile app that let people know where the best parties were at. Then a year [.]. MORE
Data just out from UK corporate finance boutique Ascendant shows that venture activity in the UK is slowing. 178m was invested in Q3, down slightly from £183m in the year ago quarter, but that combined with a slow Q2 compared with 2012 makes it look like we will be down for the year. MORE
Forecast Related Topics 
Startup Professionals Musings
JANUARY 4, 2015
Most aspiring entrepreneurs understand that you can’t build a business if you won’t commit to delivering a product or service, but many are hesitant or refuse to commit to any financial forecasts. Forecast sales-volume expectations. entrepreneur financial forecast investor startup
Up and Running
FEBRUARY 13, 2017
When I asked the standard “How are you,” he answered: “If I see another hockey stick forecast this week, I’m going to throw something at somebody.”. ” See Also: How to Forecast Sales. Sales forecasts should rest on assumptions.
Up and Running
MAY 29, 2015
First, allow me to deal with a very common problem: Business owners are often afraid to forecast sales. And that also means you should not back off from forecasting because you have a new product, or new business, without past data. That makes forecasting easier.
Up and Running
MARCH 20, 2019
With restaurants, as with most businesses, there is no single right way to do a sales forecast. The best sales forecast method will vary according to how you manage information, how much past data you have access to, and what special factors drive your business.
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Startup Professionals Musings
JULY 15, 2013
Using your data, here are the basic elements of the projection process, which are measurable by milestones, and can be tracked to show when a re-forecast is required: Start with sizing per-unit profitability. This forecast is really their commitment. Plan to re-forecast every quarter.
YFS Magazine
SEPTEMBER 1, 2015
Here are 7 ways forecasting software can improve your business. Finance Grow forecasting money. cash flow
Up and Running
APRIL 19, 2017
When it comes to starting and managing a business, forecasting your sales is essential. Having a sales forecast can help you budget and manage your business’s funds, create a plan for expansion, and avoid unpleasant surprises. The basics of sales forecasting.
Up and Running
FEBRUARY 12, 2018
Whether your business is brand new or it’s been around for a while, you’ve probably thought about putting together a financial forecast. But how do you know if your forecast model is reliable? What is forecasting? How is forecasting different from budgeting?
Up and Running
JULY 2, 2014
Sales forecasting is much easier than you think, and much more useful than you imagine. You review and revise your forecast regularly. Since sales are intimate with costs and expenses, the forecast helps you budget and manage. And that’s a sales forecast you can use.
Up and Running
JANUARY 20, 2017
Just do a sales forecast, which means you aren’t doing text, editing, or a document, just good management. Step one: The first forecast. A useful sales forecast is a lot easier than most people think.
Up and Running
DECEMBER 5, 2017
Second, skip everything else you’ve heard people talk about and jump right into your sales forecast. I just finished an initial sales forecast for our new product Outpost , and am going to share the process I went through to put it together. This really helped me jump-start my forecast.
A Smart Bear: Startups and Marketing for Geeks
JUNE 28, 2016
So, was the forecast accurate? Does that mean the forecast was inaccurate? How do you hold forecasters accountable, when the forecast is only a probability? The forecast is what chance this lead has of converting, or what dollar value it has.
YoungUpstarts
JANUARY 7, 2014
By Jessica Oaks. A new year brings with it the hope of better things to come. The past year saw some radical developments in social media – witness the rise of Vine and Snapchat – and 2014 looks to promise more of the same. Below are some social media predictions for the coming year.
Up and Running
MAY 18, 2011
Remember, there is no single way to forecast any business. Magda was looking at forecasting sales for a small restaurant. The point of this example is simply that Magda has to find a way to make sense of her forecast. And now her sales forecast is up and running.
Hearpreneur
OCTOBER 20, 2017
Besides the general focus on customer and product development, an entrepreneur should foresee the next moves that will serve to guide him on the right path.When an entrepreneur can forecast his next moves, even his/her employees become part of the moves the business makes.
Up and Running
MAY 24, 2011
Remember, there is no single way to forecast any business. Magda was looking at forecasting sales for a small restaurant. The point of this example is simply that Magda has to find a way to make sense of her forecast. And now her sales forecast is up and running.
The Equity Kicker
MAY 6, 2016
Good VCs need to be good forecasters. Deloitte have just published an interesting synopsis of Tetlock’s Superforecasting which gives us some insights into the types of people we need to recruit and the habits we need to cultivate to be good at the forecasting game. cautious in their forecasts. I’m not saying I’m a super forecaster, but I did learn from that and backed off from mobile until after the iPhone.
The Equity Kicker
DECEMBER 2, 2015
revenues because growth is much lower – forecast at 5-7% next year, and their EBITDA margin is 8%. Mahesh Vellanki from Redpoint put up an interesting post yesterday about ecommerce valuations.
Up and Running
APRIL 24, 2014
So for me, what makes a sales forecast credible? I want to see a sales forecast with drivers. Well then, that helps makes a sales forecast credible. More often than not, the problem with unrealistic profitability is, it cuts into the credibility of your sales forecast.
Austin Startup
JULY 21, 2016
July 24, 2016: Last week’s essay dealt with the fine art of pricing your startup product or service. Pricing is inextricably tied to your… Continue reading on Austin Startups
Steve Blank
JULY 22, 2010
He said, “I insist on getting weekly status reports with forecasted deal size and probability of close. If the answer is no, you have absolutely no customers on your forecast who will be prepared to buy from you in the next six months.”. The Phantom Sales Forecast.
Berkonomics
JUNE 1, 2017
Do we rely upon constant changes and call it a forecast? But during the year, if the forecast revenues fall short or are greatly exceeded, it is fair to revise the budget and rethink your hiring and resources. Hold it! These are confusing terms. When does a budget become obsolete?
The Equity Kicker
MAY 13, 2014
New forecasts out from Forrester predict that online retail sales in the US will be $294bn this year, rising to $414bn by 2018. The growth rate from 2013-2018 is forecast to be 9.5%.
Up and Running
APRIL 12, 2018
Creating financial forecasts and budgets are not typically how many entrepreneurs envision spending their time, but these tools are incredibly necessary. An accurate and thoughtful forecast can be time-consuming, but it will help you to make informed decisions regarding staffing and growth, and it will help you attract investors. Here are tips to create a practical and well-rounded financial forecast for your startup. The value of a forecast.
The Equity Kicker
MARCH 28, 2013
Moreover, their star is rising, according to Forbes a year ago eMarketer was forecasting Twitter’s 2014 revenues at $540m, 43% less than the $950m they are now forecasting. I have been wondering lately how Twitter was getting on.
A Crowded Space
AUGUST 20, 2011
One observation that I made recently is the discovery of the most incorrectly forecasted number. I’ve now been through a bunch of board meetings at a variety of different startups. The typical meeting goes through the plan and compares to actual and we all review where the company is ahead or behind plan. It’s not revenue, traffic, conversion rates or anything like that. It’s headcount. Almost all startups I’ve seen overestimate their hiring needs and under-hire against plan.
Hunter Walker
JULY 22, 2014
I don’t believe the forecast you show me. Ok, so far I’ve told you the forecast I’m looking at during fundraising is a lie and the one you’re using during initial iteration is a trap. So when is the right time for a startup to build a forecast that actually starts measuring the health of the company? The earliest a company should “manage by forecast” is post product/market fit and the absolute latest is at Series A fundraise.
Up and Running
JUNE 19, 2014
If your business is building a subscription service, creating a reliable sales forecast is a critical step to understanding how your business will grow and what the key drivers of revenue growth will be. Now it’s time to build a forecast. We’re living in a subscription world.
The Next Web
MAY 13, 2014
Why should I build a financial forecast for my fundraising presentation? This is one of the most common reactions we get during a pitch when we ask about a financial forecast. Andrej Kiska is an Associate at Credo Ventures.
The Equity Kicker
DECEMBER 12, 2013
eMarketer are predicting that YouTube revenues will hit $5.6bn this year, 50% up on last year (reported in the Guarian ). Here are some other relevant facts: Projections of YouTube’s revenues are increasing over time – in May Morgan Stanley were predicting $4bn.
Austin Startup
JANUARY 16, 2012
Market research companies like IBISWorld forecast an increased demand for insurance coverage in 2012, but by the same token, insurance buyers are expected to be increasingly selective on the plans they purchase. Sites like InsuranceQuotes.org and others of a similar breed are widely used by insurance shoppers to compare plans and find both what is right and most cost-effective for them. However, where does that leave the hard-working insurance sales agent?
BeyondVC
OCTOBER 1, 2008
They not only hit their respective forecasts set early in the year, but they beat them. More importantly these numbers speak to the commitment of the respective teams to do anything possible to deliver on the Q3 forecasts. The post Delivering on Q3 forecasts! I received some incredible news last night from two portfolio company CEOs updating me on our Q3 numbers.
Feld Thoughts
DECEMBER 29, 2016
Management budget forecast metricsAs we head into 2017, I have a steady stream of operating plans hitting my inbox. Since many of our investments are companies that are scaling, vs. companies that are just getting started, there are a lot of derivative metrics in these plans. Q1 is the easiest quarter to make your plan, so most of these companies are getting a free pass for the next three months after fighting the good fight of making or beating plan in Q3 and Q4.
SiliconHills
JULY 10, 2012
Austin Technology Austin Capital Factory Forecast Hurricane Party Rene Pinnell startup app technologyThe Austin-based startup Hurricane Party received all kinds of attention at South by Southwest Interactive 2011. Mashable wrote about them. So did Read Write Web. TechCocktail labeled Hurricane Party the hottest app of 2011 at SXSW. Hurricane Party was a mobile app that let people know where the best parties were at. Then a year [.].
Berkonomics
JANUARY 6, 2010
During the year, if the forecast revenues fall short or are greatly exceeded, it is fair to revise the budget and rethink hiring and resources. Otherwise, it is the expectation of the board of directors of a company that each year’s budget be approved in advance and adhered to as long as revenue goals are met. [Email readers continue here.] Note that I used the term “forecast” for revenues for the next year.
Up and Running
MAY 19, 2015
For the record, we could call it an expense forecast, or projected expenses. Those go in your sales forecast. The illustration here shows a sample expense budget from the same bicycle business plan I used in the previous article how to forecast sales.
Berkonomics
APRIL 11, 2011
There are many techniques and time horizons for forecasting cash. For those companies with constant billings to customers during a month, and for those with extra large fixed costs such as payrolls at periods during a month, it is important to begin the discipline of the 13 week rolling forecast as a tool for finding and planning around short term cash problems. Each week, the actual cash position is updated and the past week dropped from the forecast and a new week added.
Early Growth Financial Services
SEPTEMBER 2, 2014
The key to creating your revenue model is through forecasting—that is, projecting revenue estimates, even if you’re currently pre-revenue. Forecasting is an ongoing process that will help you to manage your cash and continue to grow. There are two general approaches to financial forecasting: top-down and bottom-up forecasting. Originally published in AffinityLive.
The Equity Kicker
NOVEMBER 21, 2013
Data just out from UK corporate finance boutique Ascendant shows that venture activity in the UK is slowing. 178m was invested in Q3, down slightly from £183m in the year ago quarter, but that combined with a slow Q2 compared with 2012 makes it look like we will be down for the year.
Feld Thoughts
OCTOBER 27, 2012
” I hung in there in this case and continued to make my point about playing offense on sales forecasting. Why is accurate sales forecasting such a challenge? Sales forecast pipelineI got an email today from an exec at a company who I was with at a recent board meeting. I thought it was a powerful summary of part of our discussion, specifically around the sales pipeline for Q4 and overall sales execution.
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