Time and Operation Costs

Sheet1

PRO FORMA EXAMPLE
GENERIC - Numbers mean nothing - project specific
Group Entered Variables
Calculated data is unshaded
Revenue Basis
Cost Basis
Calculated Gross Profit		Q1	Q2	Q3	Q4	Q5	Q6	Q7	Q8	Q9	Q10	Q11	Q12
	VARIABLES (GREEN)
	Number of Product Units:	1	3	5	20	100	140	180	240	300	350	400	500
	Material Cost/Unit:	$50	$50	$50	$50	$40	$40	$40	$40	$40	$40	$40	$40
	Manufacturing Cost/Unit:	$25	$25	$25	$25	$20	$20	$20	$20	$20	$20	$20	$20
	Operating Cost/Unit:	$10	$10	$10	$10	$8	$8	$8	$8	$8	$8	$8	$8
	Maintenance Cost/Unit:	$10	$10	$10	$10	$8	$8	$8	$8	$8	$8	$8	$8
	Org/OH (Founders) Staffing (full time equivalents - FTE)	2	3	3	3	4	4	4	4	4	4	4	4
	Consultants (App Dev, SW - FTE)	0.5	0.5	0.5	0.5	0	0	0	0	0	0	0	0
	Selling Price/Unit:	$200	$200	$200	$200	$220	$220	$220	$220	$240	$240	$240	$240
	Org/OH (Founders) Staffing Cost ($/day)	$100	$100	$100	$100	$110	$110	$110	$110	$110	$110	$110	$110
	Consultants Cost ($/day)	$150	$150	$150	$150	$150	$150	$150	$150	$150	$150	$150	$150
	Product Revenue:	$200	$600	$1,000	$4,000	$22,000	$30,800	$39,600	$52,800	$72,000	$84,000	$96,000	$120,000
	Website Revenue:	$0	$500	$500	$500	$500	$500	$500	$750	$750	$750	$1,000	$1,000
	Licensing Revenue:	$0	$0	$0	$0	$0	$0	$0	$0	$1,000	$2,000	$5,000	$10,000
	Advertising/Other Revenue:	$0	$0	$0	$0	$0	$0	$0	$0	$500	$750	$1,000	$2,000
		Year 1				Year 2				Year 3
Item	Basis	Q1	Q2	Q3	Q4	Q5	Q6	Q7	Q8	Q9	Q10	Q11	Q12
TOTAL REVENUE:		$200	$1,100	$1,500	$4,500	$22,500	$31,300	$40,100	$53,550	$74,250	$87,500	$103,000	$133,000
VARIABLE COSTS
Materials		$50	$150	$250	$1,000	$4,000	$5,600	$7,200	$9,600	$12,000	$14,000	$16,000	$20,000
Manufacturing		$25	$75	$125	$500	$2,000	$2,800	$3,600	$4,800	$6,000	$7,000	$8,000	$10,000
Operating Labor		$10	$30	$50	$200	$800	$1,120	$1,440	$1,920	$2,400	$2,800	$3,200	$4,000
Maintenance		$10	$30	$50	$200	$800	$1,120	$1,440	$1,920	$2,400	$2,800	$3,200	$4,000
Legal/Acctg - $/quarter	$1,000		$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000
IT, Website, Application and other Outreach-Sales-Advertising recurring costs	$1,000		$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000	$1,000
Organizational/Overhead (Founders)	See above	$12,990	$19,485	$19,485	$19,485	$28,578	$28,578	$28,578	$28,578	$28,578	$28,578	$28,578	$28,578
Expenses (% of Operating Labor and Org/OH)	10%	$1,300	$1,952	$1,954	$1,969	$2,938	$2,970	$3,002	$3,050	$3,098	$3,138	$3,178	$3,258
Financing Costs	Typical 2% one time points/fees for equity and debt needs, plus 6-8% interest on debt - DEVELOP WITH FUNDING STRATEGY
TOTAL VARIABLE COSTS		$14,385	$23,722	$23,914	$25,354	$41,116	$44,188	$47,260	$51,868	$56,476	$60,316	$64,156	$71,836
FIXED COSTS
Intellectual Property (Q2 one time cost)	$15,000		$15,000
Permits/Regulatory (Q2 one time)	$500		$500
Company Formation/Financial Structure	$2,000	$2,000
IT, Website, Advertising and Application Platform Costs	$20,000		$20,000
Consultants	See above	$4,871	$4,871	$4,871	$4,871	$0	$0	$0	$0	$0	$0	$0	$0
TOTAL FIXED COSTS		$6,871	$40,371	$4,871	$4,871	$0	$0	$0	$0	$0	$0	$0	$0
TOTAL COSTS		$21,256	$64,093	$28,785	$30,225	$41,116	$44,188	$47,260	$51,868	$56,476	$60,316	$64,156	$71,836
GROSS PROFIT (EBITDA)		($21,056)	($62,993)	($27,285)	($25,725)	($18,616)	($12,888)	($7,160)	$1,682	$17,774	$27,184	$38,844	$61,164
Cash Needs:		($21,056)	($62,993)	($27,285)	($25,725)	($18,616)	($12,888)	($7,160)	$0	$0	$0	$0	$0
Cumulative Cash Needs (for Funding Strategy):		($21,056)	($84,049)	($111,334)	($137,059)	($155,674)	($168,562)	($175,722)	($175,722)	($175,722)	($175,722)	($175,722)	($175,722)
LOW TECH/MKT VALUATION - Multiple of Annual EBITDA Year 3	6	$869,801	Note: Simple approach - more sophisticated techniques for valuation are available
HIGH TECH/MKT VALUATION - High Multiple of Annual EBITDA Year 3	10	$1,449,668

Revenue Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 200 1100 1500 4500 22500 31300 40100 53550 74250 87500 103000 133000 Cost of Sales Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 21256.25 64092.75 28784.75 30224.75 41115.800000000003 44187.8 47259.8 51867.8 56475.8 60315.8 64155.8 71835.8 Gross Profit Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 -21056.25 -62992.75 -27284.75 -25724.75 -18615.800000000003 -12887.800000000003 -7159.8000000000029 1682.1999999999971 17774.199999999997 27184.199999999997 38844.199999999997 61164.2 Cumulative Cash Needs Q1 Q2 Q3 Q4 Q5 Q6 Q7 Q8 Q9 Q10 Q11 Q12 -21056.25 -84049 -111333.75 -137058.5 -155674.29999999999 -168562.09999999998 -175721.89999999997 -175721.89999999997 -175721.89999999997 -175721.89999999997 -175721.89999999997 -175721.89999999997

Breakeven

Investment Needed

Sheet2

Sheet3