The complexity of ramping logic is one of the hardest things to figure out in any financial model. I approached this by assuming revenue is tied directly to the ability of up to 3 types of account executives to meet their defined quotas.
The hard part is in mapping logic that an executive is not going to be at their full year’s quota pace from the start and so a % has to be applied for the first 3 sections of time. I have just done month 1-3 are x%, 4 to 7 are x%, and 7 to 10 are x% before then reaching a full 100% effective rate. You can pick any range of months that you want the section to represent.
The other side of AE revenue would be their salary and bonuses. These have also been provisioned for and are dynamic for each type of AE.
Beyond that, the rest of this build works fairly standard but I have tried to go the extra mile in summary presentation with charts / visuals / key metrics.
You will be able to see leveraged / non-leveraged equity requirements, ROI, and IRR %’s.
There are spots for running fixed costs and those can change annually as well as be assigned a start month to match the ramping. You can also adjust variables %’s for marketing, sales tax, other variables costs, and COGS.
Having explained all of this, you can see the model has some top-down features with the variables %’s costs and AE salaries directly tied to AE count but then you have the bottom up functionality for picking your AE head count hired per month and fixed costs as well as financing.
A marketing firm or really any business where you have account executives managing the acquisition and maintenance of revenue will be able to use this.
Much of the visuals show key performance stats and the ones specific to AE would be average revenue / cost per AE and total AE monthly headcount.
There are also visuals for total costs over 5 years by category of cash outflow as well as cost by year by category.
Corporate income tax is there for an input if you want to include the potential cash outflow from this type of tax or just put a 0 if not desired.