Investing your time where it counts – the numbers

How the right financial forecast is crucial to unlocking startup investment

If you’re looking to secure startup investment, it’s inevitable that at some point you’ll face the boardroom. But when you watch shows like Dragon’s Den or The Apprentice, you’d be forgiven for thinking the pitch is everything.

Yes, being pitch ready is important – it’s where you get your chance to show your passion, explain your idea, and convince people to believe in you. But investors need more than showmanship.

A good financial forecast template brings the vision for your startup to life in numbers so investors see you’re a solid investment.
A good financial forecast template brings the vision for your startup to life in numbers so investors see you’re a solid investment.

Investors need to see your vision brought to life in numbers too. It’s what gives them reassurance, an understanding of the business’s true potential and enables them to make rational decisions about whether or not you’re a solid investment.

A financial forecast template for startups is more black and white than the vivid painting of colour in your pitch, and needs to be based on credible unit metrics that bring to life your vision for growth in tangible, detailed, numbers. 

If you’re looking to secure startup investment then read on to find out everything you need to put your best financial-foot forward.

Why is a financial forecast so important?

Investors are backing your business with their hard-earned cash, so they won’t back you on a hunch. They want to see the financial detail that demonstrates your vision is, or can be, a reality. Importantly, a good financial forecast template tells the story of growth.

Done right, a good financial forecast template can:

  1. Allow investors to visualise growth in numbers

Sharing a financial forecast is essential to attracting potential investors. Being able to project where your company will be in six months, or a year, is important to attract investors or secure bank loans.

  1. Determine business viability

The numbers show investors whether the business is viable – or not!

  1. Confirm you are raising the right amount now, and what you will need in the future

By understanding when sales may be lower or cash flow will be reduced, you can determine when your startup will need more investment (be that another equity funding round or a loan).

  1. Reduce financial risk

Forecasting allows you to take a broad view of your business and understand where resources are being wasted, so they can be repurposed or limited.

  1. Measure and improve your business

By comparing your actual performance against your financial forecast, you can continually improve and more accurately predict your upcoming performance.

Ultimately a good financial forecast template shows investors how your startup will provide a Return On their Investment (ROI).

Investors are looking for exponential growth because that increases value in the business and delivers a return on the investors’ investment. The greater the perceived risk, the greater the return they will expect. A strong financial forecast template demonstrates the rate of growth, highlights the potential for exponential returns and – if done well – reduces the perceived risk for investors too.

What does a good financial forecast look like?

A good financial forecast needs to predict future profits, sales, growth and costs. The best financial forecast template are made up of three key statements:

  1. Balance sheet – which analyses your company’s assets and liabilities. It predicts what your startup will be worth at the end of the financial year.
  2. Cash-flow statement – which shows all the money flowing in and out of your business. It answers the questions “will you have the money to do what you need to do when you want to do it?”
  3. Income statement or profit and loss statement – this shows your startup’s ability to make profit. It is build by showing sales projections, the cost of those sales, other expenses and interest and taxes.

A financial forecast template encourages use of both internal (actual) data and/or historical data to demonstrate how the business makes the most of a market opportunity and grows over time.  

Most investors expect startus to use a financial forecast template that shows how the business grows over 3 or 5 years. This will be outlined month by month, year by year.

How do you get your hands on a good financial forecast template?

Focused For Business provide a financial forecast template as part of Funding Accelerator and has proven to be instrumental in unlocking investment.

PEEQUAL used it to secure funding from the British Design Fund, and Interlinkd used the same template and discovered it opened up new ways of thinking about their business, reducing risk and opening new revenue opportunities.

Other founders have used the template to get instant offers of £50,000 from Capital Pilot’s Boost Fund. It’s clear a good financial forecast template is vital in unlocking investment.

Is your startup ready for equity investment?
Find out how attractive your business is to investors by answering 20 quick questions

Latest Blog & News

What angel investors look for in startups.

What angel investors look for in start-ups

Angel investors play an important role in the growth and expansion of startups. According to the 2021 Scale-Up Institute Annual Review on the State
Pitch deck: Go to market slides banner.

Pitch deck: How to include your go-to-market strategy

A ‘Go-to-market’ (GTM) strategy is a must-have in any pitch deck. It’s where founders showcase their approach for entering their market successfully, and the
Startups Magazine article: How to build confidence before pitching for investment.

How to build confidence before pitching for investment

Presenting is often cited as most peoples’ “greatest fear”. It’s unsurprising then that founders often lack confidence when pitching, especially if pitching is new
Future-proof your startup with engagement marketing.

Master engagement marketing: and you’ll future-proof your startup

Investors expect a clear, well-targeted startup marketing strategy if you are going to attract their investment. But, pre-funding when you are still in “hustle
Startups Magazine: Networking with startup investors banner.

Networking with startup investors: 5 tips to network successfully

Raising equity investment becomes easier when you pitch to startup investors you have previously engaged with or spoken to, or have been introduced to.
Looking for startup investors? Our guide will help

Looking for funding? Here’s your step-by-step guide to finding startup investors

Starting a business is exhilarating, but finding the startup funding to fuel your dreams can be a daunting task. Not only will you have
Startup Funding: A guide to navigating the funding journey

Startup funding: A guide to navigating the funding journey

One of the most frequent questions we are asked is “What’s the best way to fund my startup?” Startup funding doesn’t have to mean
Hatty Fawcett, Finalist in the Great British Entrepreneur Awards 2023

What being a finalist in the Great British Entrepreneur Awards has taught me

My weak spot is I don’t like talking about my achievements. I think it dates back to my childhood when I was told not
How to choose your cofounder

Choose your startup co-founder wisely

So you’ve had a light-bulb moment, a world-changing idea – you’re excited and want to share it with the world. But where do you
Whats the best way to fund my business

“What’s the best way to fund my business?”: Ten founders give the lowdown on the best way to fund your business

One of the fundamental questions, and perhaps the most frequently asked when it comes to business growth, is “What’s the best way to fund
Funding Accelerator Mentor Elliott Gaspar explains what investors look for in a financial forecast for investors

3 Things Investors Look for in a Financial Forecast: The Perfect Blend

Much like brewing a delicious cup of coffee, a compelling financial forecast for investors requires a complex blend of data, strategy, and storytelling. It’s
How equity investors can better support underrepresented founders

How equity investors can better support underrepresented founders

Raising equity investment is a challenge for any startup, but especially for underrepresented founders. They don’t just face “the usual” questions about their business,
Raising investment in difficult economic times

Raising investment in difficult economic times

It’s tough raising investment right now. There are fewer investors and the amounts being invested are smaller. How should startups respond if they still
Jennifer Anderson explains how to weave storytelling into your pitch deck to keep investors' attention

How to weave storytelling into your pitch deck to keep investors’ attention

As founders we’re told to weave storytelling into our pitch deck, but we are not always told why. Luckily Pitch Coach and Funding Accelerator
Is equity funding the best option for your startup

Is equity funding the best option for your startup?

Equity funding isn’t for everyone. When you sell shares in your business you are, effectively, entering into a long-term relationship with your investors. Investors
Funding Accelerator mentor Tracey Rob Perera shares 3 things angel investors look for in your startup valuation

3 things angel investors look for in your startup valuation

Funding Accelerator mentor, Tracey Rob Perera, shares 3 things angel investors look for in your startup valuation. Tracey Rob Perera is not only a
Hatty Fawcett talks to Finance Digest about how - and why - to build productive relationships with your investors

How to build productive relationships with investors

You might think closing a funding round is the end of a journey. In fact, its just the start! Now comes the hard work
Funding Accelerator Mentor Chris Booth shares how to expand your team without it costing more

How to expand your startup team without it costing more

Funding Accelerator expert mentor Chris Booth of Findrs explains how to expand your startup team (and extend your headcount budget) by using AI. When
Hatty Fawcett Adviser of the Year 2022

Start-up funding adviser, Hatty Fawcett, wins Enterprise Nation Adviser of the Year 2022/23

Over the last few months, start-up founders and small business owners across the UK have been voting for the best and brightest business advisers.
How startup accelerators increase your chances of funding

How startup accelerators increase your chance of funding

While I’ve written before about the benefits of joining startup Accelerators (find out more here), now seems like the perfect time to revisit the
unit metrics that attract startup investors

3 unit metrics that attract startup investors and build a compelling story of growth

Did the conversation with potential investors fizzle out at the financial stage? It’s not just the vision, but the focus on detail that secures
Panel members at How to find and impress investors June 2022

How to find investors, and impress them

Have you ever wondered what it takes to find and impress investors? Well, who better to ask than leading VCs and angels themselves! Earlier
Find-investors-by-Herbi-B-from-pixabay

How to find investors for a startup…quickly!

A recent report from Beauhurst and SFC Capital* reveals that it takes, on average, 15 months to find investors for a startup and close
Should you raise startup funding from family and friends no words

Should you raise startup funding from friends and family?

So you think you need to raise funding for your startup? You may be right, but before you being to raise startup funding from
7-Essentials-that-unlock-startup-equity-investment-600

7 Essentials that unlock Start-up equity investment

Start-up equity investment: Investors look for 7 Essential ingrediants when deciding whether to back a start-up – or not! Be succinct to get attention
Financial savings mechanism. Piggy bank formed by gears and cogs

Traction makes it quicker to raise funding for a startup

So you want to raise funding for a startup? To succeed, you’ll need to speak the language of investors. Investors will ask “how much
7 mistakes that stop you raising investment for your startup no words

7 Mistakes that stop you raising investment for your startup

Startup founders are resourceful and move quickly but sometimes that haste can work against them. They make mistakes. When it comes to raising investment
Doors within doors kilarov-zaneit-KjqNGd0sCTQ-unsplash

Why your executive summary is your most important investment document

When seeking investment for your business it pays to think like an investor, giving an investor the information they want rather than telling them