Is Your Financial Model Worthless? (Jim Gellas)
“Building a financial model is worthless and a complete waste of time! In building this model, I’m being asked to tell a story that investors already know and have a vision for what it should look like. This is one of those 'qualifying tests' to see if I can manipulate Excel to produce the numbers they want to see.” COMMON EXPECTATIONS These were the lamentations a startup founder recently shared about his views on building a financial model, just before we started working together in preparation for his raising his next equity round. I might have expected this reaction from a founder with limited experience in building financial models. However, this founder had previously led strategy and operations for a publicly traded company and already had deep experience building financial models. Of all people, I thought he’d be in the boat. I was wrong. In the grand scheme of sizing a market opportunity, identifying the right-fit investors, and keeping the wheels on an existing ...