Selling your business

Modelling the investment case

Any potential acquirer of your business will be interested in seeing a granular, thoughtful financial model and projections.

Reflecting your plan in a financial model

A sound financial model should be a foundation for your business. A good model will help to make better decisions about pricing, investment and other strategic decisions, such as focusing on your end market and defining your goals better. On top of that, if you engage in a sales process, any buyer will expect to see a financial model and projections over five years in most cases.

From a structural perspective, some characteristics of a good business plan are that it is granular and detailed, but also easy to follow and auditable for someone who has not built it.

From a commercial perspective, a good financial model should be ambitious on one hand, but also credible and underpinned by observable trends and data. This means gathering a lot of quite granular information on your business.

For instance, in order you build your company's sales projections, you will likely need several years of historical data on the volume of sales (sometimes by channel) and pricing information. In addition, if you are an e-commerce or a subscription business, you might want to look at customer data to identify patterns around customer behaviour, such as retention, churn, repeat customers and average order value.

The cost structure can also be complex and entail looking at such as the split between fixed and variable costs. You will have to look at the breakdown of costs by department and at the salary base for your whole company.

Once you have collected all of the required information, you can begin to build your model. However, besides collecting and analysing the data, which in itself can be a time-consuming exercise, you will also have to factor in the opportunity cost of building a well-structured financial model in Excel.

Importance of forecasts

To build some projections, you will have to include all the historical data, developing sometimes complex formulae to calculate forecast revenue and costs. In addition, if you are looking to build a three-statement model, you will have to include a balance sheet and cash flow.

If you're looking for someone to just write your business plan for you, a traditional financial advisor is probably not the best option. Unless they are advising on a full sale of the company, most financial advisors will not be interested in only writing a business plan for you.

On the other hand network of vetted modelling specialists can deliver a business plan, either as a standalone deliverable or as part of a broader project. Our specialists will work with you to understand the nuts and bolts of your business in detail and prepare a plan which can help you achieve your objectives - whether that be internal budgeting or looking credible in front of investors.

If done properly, preparing a financial model can be a time-consuming process. By outsourcing this to an Ithaca specialist, you can focus on what you enjoy: growing your business!

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Arun K.
Jewellery business, Founder

Ithaca was able to provide hands-on support to put together a financing plan in very little time.

Through the platform, we were connected to a handful of freelancers based on their affinity for our business model and their backgrounds (it was great to see all had blue-chip financial institutions backgrounds).

Our specialist was pragmatic and results-oriented – she understood our business inside out and was able to deliver with minimal oversight.

The app was user-friendly, intuitive and real added value, as it helped us navigate all the steps of the project, from matching and outline, to delivery, to payment and completion.

Tomás L.
Hardware technology company, Founder

We wanted to update our internal operating model and perform a valuation analysis on our business.

Our specialist did a great job of pinning down the key drivers of our company and remodelling projections using a more realistic, simpler framework.

The valuation analysis was extremely detailed and touched on all the key valuation methodologies.

It is not our first time using freelancers or freelance platforms in the past, but the end-to-end focus on project delivery made Ithaca a fundamentally different, superior experience.