The US Technology Product Co. is a Deep Tech start-up in Data Privacy space, developed a disruptive product in a new category and had raised Seed funding from a marquee VC firm. The company caters to Mid-Corporates and Enterprises in the Fintech and Banking industries.
The Problem Statement:
Having secured seed funding, the company required advisory on shaping its financial strategy and create a roadmap to get to the next level from a growth and funding standpoint. Given its disruptive positioning, the company faced a challenge of not having a reference commercial model to clearly define and forecast its revenue and cost drivers and hence its pricing strategy. In addition, the founders needed visibility on Cash burn, Runway and ascertaining the right valuation for Series A funding and Resource management decisions. To top it up, Founders required timely and accurate reporting to Investors with the right metrics.
What We did:
With our prior expertise and knowledge on SaaS and technology businesses and a deep dive on the market landscape and peers, we refined the revenue model and identified the granular level direct and indirect costs at pilot and product stages of the business. It enabled arriving at the ideal pricing model most appropriate to sell to the target market. We built a detailed financial planning and budgeting model for pilot and product stages of the business, projected Revenue, Costs, Expenses and Investments to determine the accurate cash burn/ runway metrics. Aligning with business objectives, we instituted and rolled out OKRs covering financial planning, cash management and runway extension, value accretion through IP registration and fundraising plan.
We then conducted a deep research on industry/ peers to determine various stages of funding, amount raised, valuation multiples and advised on the ideal timing and valuation to be sought for Series A funding. Lastly, we organized proper accounting techniques and SOPs through Cloud-based systems, helping in seamless tracking of all the financial transactions and preparing consistent, customized Management and Investor Reports with the right bespoke KPIs and Dashboards and setup processes for data room management for potential due diligence.
How we created an Impact:
The company benefited from a water-tight cash management mechanism to continuously monitor and track cash burn and costs, avoiding overruns and sticking to growth plans. Through detailed financial planning and budgeting models, founders benefited from deep insights on financial outlook and forecast of topline growth trajectory and enabled resource planning decisions. With structured performance reporting and KPIs, high degree of engagement and Investor relationship was established with current Investors. Our valuation and fund raising strategy which involved data-driven triggers on ARR thresholds served as a strategic compass to successfully fundraise in Series A round. Finally, the company was prepped for its due diligence process by setting up a data room for potential investors.