Description
The purpose of this exercise is to construct a typical pro formal financial projection for a startup, and to
consider the financial implications for the venture.
Your tasks are as follows:
1. Complete the spreadsheet by filling in numbers and computations (the yellow area). Do not
change the structure (columns, rows, headings, sheets). Note that you are working in months
on the cost sheet, annuals on the revenues sheet, and the P&L sheet. Year 0 is initial upfront
investment; Y1 represents development time; Y2-Y4 represent years that the app sells. Three
years is the desired time horizon. Do not include taxes or financial expenses (loan interest, stock
dividends). Do not add lines to the spreadsheet. The goal is to reach a conclusion regarding
likely cash flow from the venture on an ongoing basis. Be prepared to submit your spreadsheet.
2. Please answer the following questions on a separate sheet of paper submitted through Canvas:
What are the projected cash flows for the five years of the venture? State the final line
from the P&L sheet and the cash flow line, for five years. State the final year’s profit or
loss.
Unformatted Attachment Preview
World market size
Avid over 25 rounds
Core 8-24
Occasional 7 and under
Estimated %golfers with smartphones
iOS global share
Android market share
Apple App Store average game price
Google Play price premium
Google Play sales conversion rate
Sales commissions
Coupon conversion rate
Coupon: average sale price (net)
Coupon: average revenue to GG
Gamble: conversion rate
Gamble: “purchase” / handle
Gamble: transaction charge
65,000,000 Rounds / yr min Rounds / yr max
28.0%
455,000,000
546,000,000
27.0%
140,400,000
421,200,000
45.0%
29,250,000
204,750,000
50.0%
624,650,000
1,171,950,000 Total rounds
22.0%
9.61
18.03 Average rounds/ yr
70.0%
13.82 Average average
$
5.00
150.0%
25.0%
30.0%
5.0%
$
100.00
50.0%
5.0%
$
18.00
2.9%
Year 1
Estimated penetration, iOS
Apple customers
Estimated penetration, Android
Android customers
Apple revenue
Google play revenue
Coupon revenue Apple
Coupon revenue Android
Gambling revenue Apple
Gampling revenue Android
Year 2
Year 3
first year of sales
1.5%
2.5%
3.5%
0.4%
0.6%
0.9%
Total rounds
Average rounds/ yr
Average average
first year of sales
One-time
Leasehold remodelling
Office equipment
Comptuer equipoment
Software
Golf industry databases
Lease and rent prepay (2 mos)
Licenses, office supplies
CAPEX
Monthly
Full time developer salary
Marketing manager salary
CEO salary
Rent
Golf industry data feeds
Marketing
Telephone, utilities
OPEX per month
Pro forma income statement
Y0
Total revenue
CAPEX
OPEX
Profit
Cash Flow
Y1
Y2
Y3
Y4
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