This document provides an overview of key financial concepts for running a business, including accounting basics, creating a financial plan for entrepreneurs and projects, understanding balance sheets and profit/loss statements, managing cash flow and funding risks. It discusses the importance of getting accounting fundamentals right, where to find key business information, and how to plan for and manage cash needs over time.

1. Financial Concepts
for Running your Business
24/4/2012

2. Product & Service
level
Finance & Accounting
level
24/04/2012 Xavier Corman | Martin van Wunnik 2

3. Who we are ?
Martin van Wunnik
Xavier Corman
24/04/2012 Xavier Corman | Martin van Wunnik 3

4. Get the fundamentals right with three simple overviews
- Accounting basics
- Entrepreneurs / projects (financial plan)
Where to look to find the main information
- Balance sheet - Profit & Loss statement
Cash crunch risk, grow or survive?
- Cash flows & funding in times of crisis
24/04/2012 Xavier Corman | Martin van Wunnik 4

5. Get the fundamentals right with three simple overviews
- Accounting basics
24/04/2012 Xavier Corman | Martin van Wunnik 5

6. Product &
Service level
1.000 EUR
21% VAT
(quarterly or monthly refund request/compensation)
Investments
Cash out: 1.210 EUR
Cash in: 210 EUR (>3m)
Profit impact: 200 EUR over 5y
Cost
Cash out: 1.210 EUR
Cash in: 210 EUR (>3m)
Profit impact: 1.000 EUR
Discounted Cash Flows
Finance & Accounting
level
24/04/2012 Xavier Corman | Martin van Wunnik 6

7. Accounting: Balance Sheet
ACTIVE PASSIVE
Equity
(Capital/Kapitaal)
Non Current Assets
(Actifs Immobilisés/
Vast Activa)
LT Debts
Current Assets
(Actifs circulants/
Vlottend Activa) ST Debts
24/04/2012 Xavier Corman | Martin van Wunnik 7

8. Profit & Loss statements (P&L)
COGS (Cost of Sales)
General Expenditures
Personnel Costs
Revenues (Sales…)
Depreciation
Financial cost
Taxes
Profit
24/04/2012 Xavier Corman | Martin van Wunnik 8

9. Show me the money!
Revenues (Sales…)
COGS (Cost of Sales)
General Expenditures
Charges
Personnel Costs
Financial cost
Taxes
Depreciation CASH
CASH-FLOW IF NEGATIVE
DRAIN
Profit
24/04/2012 Xavier Corman | Martin van Wunnik 9

10. Get the fundamentals right with three simple overviews
- Entrepreneurs / projects (financial plan)
24/04/2012 Xavier Corman | Martin van Wunnik 10

11. http://www.monstarterkit.be/bzplan.cfm
24/04/2012 Xavier Corman | Martin van Wunnik 11

12. 24/04/2012 Xavier Corman | Martin van Wunnik 12

13. Content Financial Plan
– Assumptions
– Profit & Loss
– Balance Sheet / Investment
– Cash-Flow -> Cash needed
– Valuation of the project
– Profitability / return of the project
Don’t waste your time in developing a huge financial plan
before being sure that your project is viable !
24/04/2012 Xavier Corman | Martin van Wunnik 13

14. Financial Plan in 10 min /questions
What are your revenues ?
What are your costs ?
What are your investments ?
How many persons for your project ?
24/04/2012 Xavier Corman | Martin van Wunnik 14

15. • 3 to 5 years
• Monthly or Quarterly base
• Excel or Calc is your friend
• Start by listing your main assumptions
24/04/2012 Xavier Corman | Martin van Wunnik 15

16. Tips for assumptions
• Office: 10-25 m²/person
• EUR 100/m²/year + 15 % for maintenance
[ or COWORKING !]
• Insurances: 1 -3 % of revenues
• Marketing: define a % of revenues + starting
investment
• Don’t forget lawyers, accountant, social
secretary, office supplies…
24/04/2012 Xavier Corman | Martin van Wunnik 16

17. Tips for assumptions
• Car leasing : 300 – 800 EUR per month
• Salary : Gross monthly x 19,2 = Yearly cost
• Revenues: worst-case & best-case
– First 3 to 6 months: 0 EUR
– Maximum ‘billable’ hours per day
(one-off events, holidays, prospecting, etc...)
• Own salary : Realistic
different ‘hats’
24/04/2012 Xavier Corman | Martin van Wunnik 17

18. Where to look to find the main information
- Balance sheet - Profit & Loss statement
24/04/2012 Xavier Corman | Martin van Wunnik 18

19. www.nbb.be “On-line consultation of annual accounts”
www.data.be
Yearly publication
2 years
Short or Long version
Public!
24/04/2012 Xavier Corman | Martin van Wunnik 19

20. 24/04/2012 Xavier Corman | Martin van Wunnik 20

21. 24/04/2012 Xavier Corman | Martin van Wunnik 21

22. 24/04/2012 Xavier Corman | Martin van Wunnik 22

23. GROSS MARGIN
– GENERAL
EXPENDITURES
PERSONNEL COSTS
DEPRECIATION
FIN. REVENUES
FINANCIAL
COSTS
LOSS
24/04/2012 Xavier Corman | Martin van Wunnik 23

24. Cash crunch risk, grow or survive?
- Cash flows & funding in times of crisis
24/04/2012 Xavier Corman | Martin van Wunnik 24

25. CASH
24/04/2012 Xavier Corman | Martin van Wunnik 25

26. Required Cash-Flow
24/04/2012 Xavier Corman | Martin van Wunnik 26

27. How to finance your start-up ?
24/04/2012 Xavier Corman | Martin van Wunnik 27

28. Next Workshops
ICAB (Brussels)
Registration through www.westartup.eu (50 EUR VAT incl.)
24/04/2012 Xavier Corman | Martin van Wunnik 28

29. This presentation is available for free:
www.slideshare/FinanceCoach24.com
www.slideshare.net/xaviercorman
Group:
www.meetup.com/Finance-for-Startups
24/04/2012 Xavier Corman | Martin van Wunnik 29