Marketplace (Basic) Financial Model Template

Many startups ago… I built my first fundraising model. I had toiled for years in M&A so knew something about modeling, but man… what I built still wasn’t really useful and it distracted me from when I should have been executing, pushing sales, tracking my marketing KPIs etc. Darn.

Fast forward many years and I’ve learnt a thing or two. I’ve raised for myself and many others. For my startups and for others I’ve done fundraising for, I’ve built a number of models. They were all solid, but they weren’t mind-blowing (in my opinion). A founder reached out to me for an eCommerce model when I was studying data science by the beautiful beaches in Bali and I thought, screw it. Let’s make something cool.

Over the course of a month, I pulled all the cool stuff I had coded before, analysed the models I had, studied the pros and built this model. Figuring out how to do some of the calculations was almost enough to make me quit… Founders seemed to like this model, so I built others such as for SaaS. I took the learnings and improvements from those models and fed them back into here.

I don’t make that many models because they take so much time! Look at my models and you can see why! I kept getting harassed by founders for a marketplace model, so I said screw it, let’s do it.

I looked around to see if there was anything I could copy, any logic I could apply and nada. There is no model around worth paying attention to. I had to figure out everything from scratch.

It’s taken a month but it’s done. The full marketplace model is one of the largest models that I’ve made as I had to figure out how to give you a lot of flexibility on both the demand and supply side.

I get a lot of founders who just want a simpler model or something that matches their bank balance, so I’ve started making smaller versions of the models. This is the first one I have made

Whether you’re raising for your marketplace startup, or needing to develop an operational plan to understand how you are going to grow and not run out of cash, you need an Excel model. The problem is that they’re really hard to build. You don’t have time to spend 2 months building one, you need to be executing like I wish I had. Sure, maybe you have an expensive, smart CFO, but they’re still running your company, and the ROI on their time to replicate what I am doing is ignorant. For the cost of an hour of their time (or mine), you skip months of development and get straight into inputting your actuals and forecasts. This is a no brainer.

Resent buying a model, and feel better paying someone to build a model for you? Sure, paying someone smart to build something sort of usable can cost $10k+. You won’t even get what you want. I’ve seen the models ex-bankers build. They don’t get startups. They think like bankers.

Want to find a free one? Sure. I found around 5 others which weren’t bad, but just really limited in terms of functionality. These don’t solve the problem of just having something which just works and gets you back to building your GMV (Which actually matters).

This is the model I wish existed. I literally built it for you. I only build new things which add value to founders, not copy others.

• Right timeline for your stage: 36 months of forecasting with 3 annual summaries
• Flexible for actuals and forecasts: Actual and forecasts with sheets which combine your numbers into a combined P&L to the exact month magically
• Staff: Simple modelling of staff hiring. You can decide the month your staff will join. Furthermore, you can set a date and salary increase (such as post-series-A/B/C) and salaries will increase on that date, and adjusted for bonus and payroll taxes and benefits
• Expenses: Super simple assumptions to rapidly forecast your G&A, S&M, R&D and CAPEX
• Cohort approach to forecasting: Cohort based forecasting model without the work. Input a few assumptions and you can get monthly cohorts for customers
• 3 revenue streams for suppliers: Transaction, member, and listing revenue
• 5 revenue streams for demand customers: Transaction, affiliate transactions (CPC and CPA), member, listing, and advertising revenue
• Simple marketing: Just pick the cost per registration for both sides
• Detailed KPI sheets: Full dashboard of all your KPIs for both general operations and all your marketing metrics
• Charts: Breadth of beautiful charts to graphically explain your business
• Full blown P&L: Detailed, logical P&L explaining your business model step by step
• Summary P&L: Easily copy and paste your summary P&L into your pitch deck
• Sources and uses: Get insight into your fundraise requirements. Three beautiful charts to copy paste into your pitch deck

• Fully integrated and automated model: Get insights from KPIs if your assumptions make sense so you look like a pro with a plan
• Standardised structure on each sheet: Every monthly calculation in the marketplace financial model starts in the same column which makes it easy to audit
• Consistent: Consistently colour coded cells for formulas, links and assumptions applying best practices from global, top-tier investment banks. All cells are perfectly aligned
• Comments: Comments on all assumptions so you know what to input and why
• No hard coding: No hard coded numbers in any formulas
• Open editing: The model is not locked, you are free to restructure as much as you like!
• Clear linking: Links to each sheet are always at the top of each sheet to track and understand where assumptions come from and what sheets are driving another one
• Separate actuals and forecasts in your P&L: Easily update your model monthly during your fundraising without fuss. Combine months by simply adding a date of your choice
• Dynamic year end: Set your year end at a month of your choosing. All annual adjustments are made automatically with powerful formulas
• Accounting: Cash and revenue accounting
• Forecast period: 36 months of forecasting with 12 month summaries for each forecast year
• Change assumptions every month: Make the marketplace financial model assumptions as simple or complicated as you like. Every assumption is mapped out on its own row. For example, any month you want to increase your listing prices, simply change that month. If you want to keep your assumptions linear, the formulas support that decision automatically and by standard

I answer this above but I get asked a lot, so will make it clear.

I don’t make toys. If you want to do “finance good’, get Excel.

Google stuff is only for sharing things.

I use complex calculations, and Google can’t process them all.

It’s not even ‘if’ it will work in Google, you just don’t want to go there.

Just get Excel if you want to be in the big leagues and use my models. It will be so much more enjoyable.

I built the first models on my MacBook Pro Retina, so I know they work.

There are no compatibility issues between PC and Mac (Other than Macros). Mac just sucks huge donkey dick if you are amateur plus level and know shortcuts (like you should!).

If you’re at some SF startup with a douche tech policy requiring Macs, it’s OK. My models will work.

Just tell your tech team you need to do your job and give you a fricking PC. Laptops are cheap these days.

I really mean it. You can’t do finance on a Mac and enjoy your job (effectively).

I hate Excel on Mac so much I’m even willing to do a call for free to make the case.

The model is very detailed and powerful. There is nothing available on the internet on this level. It assumes you have an understanding of SaaS and for navigating Excel. Every effort has been made to make it simple for a founder to get impressive results without having to be advanced in model structuring (We did all the hard work).

You don’t have to do ANY modelling to use this model. You just need to be able to fill in the assumptions boxes. Only if you need to restructure the model due to you having a special business model will you need to be advanced level.

The ideal user:

• Building a complex or simple SaaS company, with consumer (automatically onboarded) and/or SME (Sales supported) customers. Every variation is covered
• Is comfortable with numbers and wants to have control over their model with fairly granular assumptions, or rather the ability to change pricing every few months if they wanted to…
• Is at the seed to the scaling stage of fundraising. The model doesn’t present years of historical data, which may not be perfect for later-stage companies. You could easily add this though. The focus is on 3 years of forecasts and the year-to-date actuals. A new model will come with advanced accounting functionality soon
• Likes to impress and enjoys a beautiful model!
• Wants to show investors they applied a very vigorous, logical approach to their forecasting and operations
• Wants a model that runs rings around hotshot bankers without the crazy cost
• Needs a logical, consistent model they can use to customize for their own purposes (Ideal)

I don’t offer returns (it’s a digital good), but want to make sure you succeed; so if you are new to Excel and marketplaces and aren’t willing to put in some work to learn, this model might not be for you.

• If you don’t know how to use a (SUM) function you may find it overwhelming if you need to understand every detail. Every line has been broken up to be logical to understand, so with a little diligence anyone can be a total boss.
• If you don’t really understand marketplaces, it might be too much but it will help you learn
• If you don’t understand how marketing works (such as what CTR is), then the detailed sheets in the model may have too much detail for you to handle. Use the basic ones instead
• If you insist on using Google Sheets, don’t use this

There are a number of additions which could have been added to this model and have purposefully not included. If you have seen models with other frills, trust there are reasons why they have not been included. Let’s go through some of these so you understand:

• Traditional cash flow statement and balance sheet: There is a cash-based accounting section to understand your actual cash burn. Investors don’t really care about your BS and CFS sheets like a PE company would. They care about the logic of your model to show it is thoughtful. They care how much revenue you will generate to size the market opportunity (how they will get rich) and how ambitious you are. The BS and CFS are useful at growth stage companies when there is a line of sight on meaningful forecasts- early stage you don’t really have many reliable numbers so they serve to create information overload
• Cap table: It is best to have this separately so it is a distinct conversation rather than bundling it with your forecasts. If you need a model you can get one of mine
• DCF and valuation: Having a DCF at the early stage is totally ridiculous, particularly as the assumptions don’t make sense (What’s your discount rate? Show me how to do your WACC…). A DCF is also not how VCs value early stage companies. Including a DCF or multiples is not how you want to approach a valuation discussion with investors and I think can actually harm you in negotiations. I recommend not putting a valuation in the model
• Complicated paid marketing assumptions: We want to show logic not needless complexity. There is some very smart logic in calculations for emails and the like, but we try to keep the number of assumptions down so you can discuss what’s important (Like CPC and budget, not keyword volumes)
• Growth modelling: If you are at the growth stage, you will have a lot more visibility on your actuals and have more historical reporting. This is not the best approach to modelling and fundraising for you. But the cool thing is, if you know basic Excel, it’s easy to add columns for your actuals if you like. We’re happy to add those for you

Startup is hard and fundraising is a total nightmare. It takes up so much time and it can be far easier to execute if you have the right tools on hand.

When we started Delivery Hero I spent far too much time figuring out how to build a good fundraising and operation model and it was infuriating. I wished I had something that just worked or a base I could use to fiddle with and get the result I wanted (Meaning, getting back to executing). We’re making these models so you don’t have the same painful, long nights and weeks, not executing like I wished I could have.

• The model is provided as is
• Every effort has been made to ensure there are no errors. Given the size and impressive depth, it is impossible to ensure there are none. If you find an error, please reach out so it can be fixed for everyone! I am happy to help you fix any errors free of charge
• If you need support building your model I offer a consulting service dependent on your bespoke needs

• You need Excel. Google Sheets is never to be used for a fundraising model as the functionality is limited. It might work in Sheets, but I can’t warrant it will work. I highly recommend using a PC and Excel
• This works on both Mac and PC and was built on both (But Mac sucks)
• You should install the ‘Solver Add-in’ and ‘Analysis TookPak’ if you do not have it installed already. These are free and standard Microsoft add-ins. I don’t require it, but it’s worth having
• I do not have circular references so there is no need for ‘iterations’ in this model, but in case, turn them on in your calculation settings, especially if you fiddle.
• This is not needed, but if you want to be a boss in Excel, download https://www.asap-utilities.com/. There are some really useful tools if you need to build models. It only works on PC though (as do the other cool tools).

Yes. There are business models which will require the model to do things that you need. I charge $300 an hour and can build whatever you need.

No refunds.

These are digital goods. You can’t return them.

If you aren’t sure if this model is for you, ask me your questions first.

You can email me or hit me up on live chat (If I’m around).

Hi. You’re on my site, I built the models.

I’ve worked at Lazard in FIG M&A (Top tier firm and team), and VC, I’ve built lots of startups, I mentor at lots of accelerators (And mentor some of the people who run them), TEDx talked, bla bla.

I’ve got more free Excel tools on my site than any other startup site and I give the stuff away that others charge for. Get some of my free stuff and tell by yourself before you buy if you aren’t sure.

I spent a fricking week auditing this model.

If there is an error, I want to know! Just email me and I’ll look into it and fix it for you gladly. Maybe within an hour if I’m free.

Bear in mind normally when people say there is an error they just did something wrong and didn’t understand why.

Yes. If someone finds an error, or I add new functionality, I send updates to everyone with the new model.

I DO NOT hide anything in any model I make.

Yes, I know of one well-known model that locks everything. I think that’s dumb (Mainly because I already hacked it).

You can do anything to my models if you want. I purposefully design my formulas so you can follow what is happening.

My models are fully editable.

I also do not do VBA as I want you to be able to see what is going on.