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PRO FORMA SOURCES AND APPLICATION OF FUNDS (YEAR 1-5)

ENTR427 WEEK 5: ASSIGNMENT WORKSHEET

Early Stage Financing

 How will you raise the money needed for

o Seed Capital to build prototypes, proof of concepts, etc.

o Company start-up costs & initial marketing research

Expansion & Development Stage Financing

 How much and from what sources will funds be available for…

o Second stage capital for initial growth

o Third stage for expansion to grow sales revenues

o Fourth stage to prepare company for initial public offering (IPO)

Acquisition and or Leveraged Buyout (LBO) Financing

 Traditional acquisition and control of the company

o LBO another company buying out the present owners

o Owner, Investors Managers of the company buying all outstanding shares of the

company’s stock making the company private.

Product Development Budget Year 1 Year 5

Developers

Lab & Facilities

Prototype / Minimum Viable

Product (MVP)

Test Marketing

Marketing Strategy Budget Year 1 Year 5

Market Research Personnel

Customer Focus Groups

Market Data Analysis

Limited Release / Launch

Selling Budget Year 1 Year 5

Advertising/promotion expense for; e.g.

a store front, web page, a facility?

Salaries for sales agents, people?

Misc. Selling Expenses

Production & Distribution Expense

Note: This is not a complete and exhaustive list of start-up expenses you will encounter.

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