finance & accounting Archives

Brazilian Jiujitsu Financial Projections

Brazilian jiujitsu academy Carlson Gracie South Bay requested financial projections to help plan for an upcoming expansion.

Accurate financial projections allow an academy to know how much they can spend on rent, service pricing, headcount break-even points, budget for their operating expenses such as marketing and payroll, and much more.

About Carlson Gracie South Bay

Brazilian jiujitsu academy Carlson Gracie South Bay offers classes throughout the week, one class in the morning and one class in the evening,so you can easily fit your training into your schedule. The student will learn techniques and principles that made Brazilian jiujitsu the most efficient and effective fighting art in the world.

Carlson Gracie South Bay students compete in the highest level tournaments and hold numerous titles at the World, Pan American and Open Championships at IBJJF, NABJJF, JJWL, Abu Dhabi, BJJ PRO and NAGA federations. They also have students competing at UFC and EBI tournaments.

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September 11, 2022

3-Year Financial Projection for SaaS app Park Yourself

Your Startup Guru created a custom-made 3-year financial projection for SaaS app company Park Yourself which allowed the founder to anticipate future revenues and expenses.

About Park Yourself

Hunting for a parking space or EV charging station can be unnecessarily tedious and incredibly frustrating at times. With just a tap, Park Yourself helps you seamlessly find and reserve your parking or charging spot on the go.

Look Anywhere and Anytime
- Search for great parking or vehicle charging spaces near your destination. We list thousands of lots, garages, private driveways, parking spaces and Electronic Vehicle charging hubs in real-time. Compare locations using multiple filters including distance and price. With all the available spaces at your fingertips, Park Yourself allows you to cut your search time in half. Book and pay for your space on the spot or in advance and you’re guaranteed to have a convenient time on the go.
Book Simply and Easily
- Book on the spot and pre-pay in advance to reserve your desired parking or charging space and have a guaranteed slot waiting for you upon your arrival. No more driving around looking for an empty lot, street parking or the nearest EV charging station during your trip. Park Yourself removes your worries about expiring meters, parking tickets and unwanted interruptions on the road.
Park Conveniently
- Redeem your purchase seamlessly at your selected location. No more worries and no more driving around looking for the perfect spot. With Park Yourself, you get to save time and money with hassle-free drive-ins.
24/7 Support
- Our support team is available round-the-clock to assist you with your inquiries and concerns. Contact the parking lot staff to get answers quickly using a simple in-app chat feature.

Launch and Grow Your Business

With the financial projection Your Startup Guru created for Park Yourself, they know when cash will be low, their break-even point, sales escalation, budgets, and more. No business, including SaaS apps, can confidently plan for the future without a thorough and accurate financial projection. Contact us to create a custom-made 3 or 5-year financial projection for your business.

July 22, 2022

Pharmacy Valuation

Valuation Methods for Pharmacies

Our client needed a valuation for the purchase of a pharmacy. A valuation is crucial to determine a reasonable purchase price range for a business. Several methods, adjusted specifically for pharmacies, had to be used to arrive at a valuation. The methods used were Enterprise Value, VC Method, Discounted Cash Flow Method, and the Multiples Methods based on historical financial statements. Then an average was taken from the calculated values to arrive at a valuation.

Entrepreneurship Methods

Starting a brand new business is not the only entry into entrepreneurship. Purchasing an existing business is another viable method of entrepreneurship because oftentimes, there is an existing customer base, name recognition, equipment, vendors, licenses/permits, and other operational systems in place. Furthermore, nothing is preventing the new owners from

Launch and Grow Your Pharmacy Business

Pharmacy or not, no matter what business you are considering, contact Your Startup Guru to know that you’re getting a reasonable price for the company.

July 22, 2022

What Angel Investors Prefer

Not all industries get the same attention, and there is a pattern to what angel investors prefer. For example, according to a recent report based on an analysis of 2,492 transactions across 2,444 companies, all completed in 2019, angel investors are more likely to prefer certain industries and deal structure types (e.g., convertible notes).

Selected portions from the report below:

Industry

The 2019 data revealed a first-time decline in the information technology/software segment as a percentage of total transactions relative to other investment segments (2019/2018) — 29% of the investments (2019) were in information tech, compared with 38.6% (2018). Yet Information Technology still remains the dominant segment for angels.

Angel Investors Prefer: Consumer Products / Services sector saw significant growth, up from 18.2% (2018) to 25.75%.

If Healthcare and Biotech were combined, they would comprise 21% (2019) of transactions versus 18% (2018). We added Biotech as a discreet sector to track in 2019, but for comparison sake, you can observe that even without Biotech, the Healthcare segment continues to be a major category for angels.

We also noted an increase in Financial Services’ Fin Tech in 2019, which was too small in 2018 to warrant its own category. In 2019 companies in this sector participated in 3.55% of all transactions. The Energy sector also rose to over 3%, with a few related Environmental companies included.

And for this year, we found enough companies to warrant adding Ag Tech (1.2%) as a separate category and clearly growing. While Info Tech and Software is still the leading category for angel investing, but by a much smaller margin than in the past, we also acknowledge that Info Tech / Software is often a necessary core component of many other sector investments.

Deal Structure Type

While we continue to see the use of SAFE notes, they are a minor percentage of all Seed transactions at 4.7%. The primary structures were 51% Convertible Notes and almost 41% Priced Preferred. SAFE’s are not reported in our data as frequently as we hear them discussed amongst early-stage entrepreneurs.

Series A transactions were (as expected) Preferred Stock 86% of the time, with 12% standard Convertible Notes associated with a Series A, typically a bridge to Series A, but distinctly beyond the Seed stage.

We did find SAFEs were most frequently used in Mid-Atlantic Region at 12%. The Mid-Atlantic use of SAFEs may be heavily influenced by US Federal DOE, NSF, NIH, and other grant money, which does not permit debt as a liability while grant funds are in use; hence early-stage companies who do not wish to price their round are opting for SAFE notes.

California was #2 in SAFE usage at 10%, influenced by California incubators and possibly by science companies vying for Federal grant funds.

There are considerable pre-money valuation and round size discrepancies when it comes to the various demographics of entrepreneurs. This highlights a disturbing flaw in the angel investment community, but that goes beyond the scope of this blog post.

Launch and Grow Your Business

Your Startup Guru fundraises for clients from a broad spectrum of industries, including restaurants, SaaS, fintech, and more. Capital ranges from $10,000 to over $10 million have been found.

We have solutions for you even if your industry is not what angel investors prefer because capital is sourced from private equity, banks, economic development authorities, grants, and more.

July 13, 2021

Bookkeeping Client – Shred Moto Co.

Shred Moto Co. is a motorcycle dealership based in Chatsworth, CA. They came to Your Startup Guru for help securing the various permits and licenses needed to operate their business. However, as any business owner will tell you, permits are just the beginning. As such Your Startup Guru is providing bookkeeping services so ensure their new business continues to remain profitable and well managed.

October 1, 2019

Agency Financial Projections

Even the most capable organization needs help sometimes in delivering on their service offerings. Rise Above Enterprises is a full-service, independent, global agency needing financial projections for one of their projects.

Rise Above Enterprises helps clients thrive in unforgiving -moving business climates. From product launches and spin-offs to mergers, line-extensions, and complex cause-related marketing efforts, they build value and leadership with every step, turning key moments into critical success.

August 13, 2019

Recruiting Service Strategy Consulting

Staffing and recruiting service PMG Employment Solutions came to Your Startup Guru for help targeting companies to acquire. We provided corporate valuations and strategy analyses to help PMG make the best choice for their expansion.

PMG Employment Solutions is a full staffing and recruiting service dedicated to finding qualified workers for employers. They specialize in providing potential employees for permanent, part-time, seasonal and temporary positions with companies in manufacturing, service industries, construction, and agriculture.

February 4, 2019

Investors with trillions set up climate change action

Nearly 400 investors with assets worth $32 trillion announced The Investor Agenda last week, a first-of-its-kind global agenda aimed at demonstrating and supporting investors in accelerating and scaling-up actions critical to meeting the goals of the Paris Agreement.

In other words, if you’re a greentech or cleantech company, there may be some capital available for your business.

Read more about the Investor Agenda here.

September 20, 2018

Sober Bar Financial Projections

Your Startup Guru created financial projections for Sans Bar, a one-of-a-kind sober bar in Austin, TX. Sans Bar’s mission is to provide a safe, sober environment for adults to celebrate life while promoting personal and social wellness.

With the help of our financial projections, entrepreneurs can see how much they need to make and save in order to meet their financial needs; in addition to many many other uses. You can read more about the importance of a financial plan.

May 1, 2018

The Cryptocurrency Conundrum

Cryptocurrencies took quite a hit in 2018 and have not been a good year for the market so far. Having reached a valuation of $834 billion as of January 7, 2018, CoinMarketCap reported that the market witnessed a drastic plunge of about 66%, losing over $553 billion. Bitcoin recorded a huge loss of over 50% in February, with valuation dropping below $7,000. Ethereum and Ripple also suffered similar drops, both recording losses of over 40% during the same month. Even as of late March, the leading currencies have not bounced back as of March 21, 2018.

Most signs point to a bubble. Market speculation that drove prices to an untenable price for the time being. This bubble was exacerbated by the unregulated nature of cryptocurrency. For example, banks are required to physically hold a certain amount of cash in reserve, also known as Regulation D, which allows for an amount of liquidity in the market in case of lean times. Given the unregulated nature of cryptocurrencies it is possible that market manipulation was also behind the plunge. In 2013, Bitcoin rose from $150 to $1,000 within a period of 2 months. A rise that researchers have found was caused by one person. Last month, one anonymous investor bought $400 million in Bitcoin. For securities transactions such as stocks and bonds, the identities of the buyers and sellers are known and recorded. In cryptocurrency transactions, the transaction is known but not the entities.

However, to understand a little about what is happening, it helps to understand what cryptocurrency is.

What is Cryptocurrency?

According to Wikipedia:

A cryptocurrency (or crypto currency) is a digital asset designed to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets.^[1]^[2]^[3]Cryptocurrencies are classified as a subset of digital currencies and are also classified as a subset of alternative currencies and virtual currencies. Cryptocurrencies use decentralized control^[4] as opposed to centralized electronic money and central banking systems.^[5] The decentralized control of each cryptocurrency works through a blockchain, which is a public transaction database, functioning as a distributed ledger.^[6]

Bitcoin, created in 2009, was the first decentralized cryptocurrency.^[7] Since then, numerous other cryptocurrencies have been created.^[8] These are frequently called altcoins, as a blend of alternative coin.^[9]^[10]^[11]

That is a lot to digest so to summarize and generalize: cryptocurrency is an electronic asset that is created through among other methods, “mining” (the details of digital asset creation go beyond this post). Once this digital asset is created, a record of its created is added to a decentralized ledger. This ledger is known as a blockchain. Blockchain is like a title chain in real estate; everyone knows who owned it in the past and who owns it now. Furthermore, transactions using cryptocurrency is also recorded in the blockchain.

The blockchain is starting to look more useful than the actual cryptocurrencies, but more on that in a future post.

Differences from other currencies

Crypto isn’t going away but probably won’t replace sovereign currency because it doesn’t have that backing of an entire nation. There’s more power when you have a nation that promises the worth of something vs many individuals that aren’t a cohesive entity

A nation has natural resources, a military, existing contracts, labor forces, etc. that can be used to back the value of their currency. Crypto does not. They are kinda like fidget spinners. Some people highly value it and trade it but not likely to replace dollars.

Similarities to commodities

More than a “currency” cryptocurrency seems to have properties similar to commodities such as silver in that people can “mine” it too. That said no government uses, say rubies, as their official currency.

Cryptocurrencies are also relatively unregulated like commodities. Beyond futures contracts and derivative markets the industry did not see much action beyond the Commodity Exchange Act of 1936. Other than a few laws, regulatory bodies such as the Commodity Futures Trading Commission did not see much action until Dodd–Frank was enacted in response to the 2008 financial crisis.

For the reasons mentioned, it seems like a judge also agrees that cryptocurrencies are commodities. Maybe it is time to call them cryptocommodities.

Are Cryptocurrencies here to stay?

Probably not going away but many hurdles block mainstream adoption. Of course, if a government officially recognizes it then it’s all systems go. For now, China says no and S. Korea is hesitant. Furthermore, Warren Buffett considers cryptocurrencies speculative.

Cryptocurrency will probably end up like precious gems and metals; worth something but will not upend sovereign currency. Buying a car in wheat is possible but not as convenient as with traditional currencies. Although some dealerships accept some cryptocurrencies.

March 15, 2018

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