Ka - Financial & Funding Model
Sep' 2021
'ka-Financial & Funding Model' is a distinct stage in 'ka-product engineering' framework, defining methods and tools to arrive at the financial and the funding models.
About this article
This article details 'Ka-Product Viability Assessment', associated processes, templates and tools. This is a part of ka-product-engineering documentations.
This 'product viability assessment' can be used independent of other components of 'Ka-product engineering framework'. However, it integrates seamless with rest of the components, and we have observed immense value addition.
Hope this is of help to you!
The need
IT, has a natural affinity to operate on best practices & strong architectural principles. However, this has a side effect of IT drifting away from the core business it is trying to support and move towards its own silo.
Of late, there had been attempts to narrow the ridge between IT and the business it supports. Agile model is one such example of that attempt.
For startups built around IT capabilities, existence of this silo would be a disaster. It is difficult for any silo setup to support a reduced Time-To-Market or Fail-Fast. This has also been realized by established enterprises too.
These changing paradigms leave those in IT to be at a cross road between Business Expediency and Established best practices.
Ka framework attempts to merge these seemingly contradicting aspects through its best practices and tools.
Key drivers & objectives
Rapid prototyping
- To increase Time-to-Market and enable Fail-Fast.
- Quick “Concept to Prototype” – key for product’s market viability.
Identify marketing Channels
Identify sales leads channels
Identify staffing plans
Identify capitol infusion channels
Build the marketing model
Customer acquisition by sales leads
Marketing effectiveness by marketing channels (conversion)
Marketing Budget
Build the revenue model
Sales lead growth rate by customer acquisition channels (month-on-month)
Take the product or service pricing model (from ka-product viability assessment)
Define sales margin for products or services.
Define any recurring revenue model.
Build the staffing model
Identify the key staffing teams, the the roles on each teams.
Identify the annual package for each of the role, including the annual package growth rate.
Identify the sales and marketing staffs, in addition to the senior staffs.
Build the cost model
Based on above, build the cost model
Identify the build the Funding Model
Identify the capitol infusion.
Build the cash flow & cash position model.
Build the financial statement
Revenue, Cost of goods\service sold, cross profit.
Personal cost, CapEx & OpEx
EBITDA
Build the investment model
Create valuation models based on a series of stages of investment.
Investment stages and options - Seed funding round(s)
Series A, B,... funding models are not currently covered by ka.