SaaS Economics - Ramping a SaaS salesforce

Part 1: Model the ecomomics of a single sales person

Sales compensation and overhead
Base Compensation $ 50,000
Variable Compensation $ 55,000 with 50% draw for first four months
Draw on Variable Comp 100% 70% 30% 0%
Productivity Ramp 10% 33% 66% 100%
Additional overhead $ 30,000
Sales attrition factor 15% a factor to discount bookings to account for failed sales hires and att

On target annual bookings

Annual Bookings 500,000 ACV (Annual Contract Value)
Monthly Bookings $ 41,667 ACV (Annual Contract Value)
Monthly Bookings $ 3,472 Billed monthly (=ACV / 12)

Churn Rate and Margin

Churn Rate (monthly) 2.50%
Gross Margin 80.00%

Cost of Leads required to feed sales

Average Deal Size $6,000 (ACV) Annual Contract Value
Deals to meet target 6.9 per month
Leads to closed deal 10
Cost per Qualified Lead $125
Cost of Leads required $ 8,698 per month, for 1 fully productive sales person

Other interesting Calculations

Lead Gen costs per deal $ 1,253 Excludes people costs
Selling costs per deal $ 1,620 Excludes cost of sales management
Total CAC $ 2,873 Excludes people costs in marketing, and sales management. (CAC= C
Total LTV $ 16,000 Calculated by dividing average monthly gross profit per customer (AR

Income Month 1 Month 2 Month 3 Month 4

Productivity Ramp 10% 33% 66% 100%
Bookings (ACV) $ 3,542 $ 11,688 $ 23,375 $ 35,417
New MRR added this month $ 295 $ 974 $ 1,948 $ 2,951
MRR from prior months bookings $ 295 $ 1,262 $ 3,178
Churn $ (7.38) $ (31.54) $ (79.45)
Total MRR (Billings) $ 295 $ 1,262 $ 3,178 $ 6,050
Cumulative Billings $ 295 $ 1,557 $ 4,735 $ 10,785
Cumulative Gross Profit $ 236 $ 1,245 $ 3,788 $ 8,628

Expenses
Base Salary $ 4,167 $ 4,167 $ 4,167 $ 4,167
Variable Compensation $ 4,583 $ 3,208 $ 3,025 $ 4,583
Overhead $ 2,500 $ 2,500 $ 2,500 $ 2,500
Cost of leads required $ 850 $ 2,806 $ 5,611 $ 8,502
Total Expenses $ 12,100 $ 12,681 $ 15,303 $ 19,752
Cumulative expenses $ 12,100 $ 24,781 $ 40,084 $ 59,836

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net profit $ (11,864) $ (11,671) $ (12,761) $ (14,912)
Cumulative Net Profit $ (11,864) $ (23,535) $ (36,296) $ (51,208)

Bookings & Churn - Single Sales Hire MRR - Sin

$3,500 $30,000

$3,000 $25,000
$2,500 $20,000
$2,000 Churn $15,000
$1,500 New MRR added this month
$10,000
$1,000
$500 $5,000

$- $-
1 2 3 4 5 6 7 8 9 0 1 2 1 2 3 4 5 6 7 8
$(500)nth nth nth nth nth nth nth nth nth th 1 th 1 th 1 th th th th th th th th
o o o o o o o o o on on on on on on on on on on on o
$(5,000)
M M M M M M M M M M M M M M M M M M M M M
$(1,000)

Part 2: Look at the Overall Economics when Ramping Sales Hires

Month 1 Month 2 Month 3 Month 4

New Sales Hires 2 2 2 2
Total Sales Headcount 2 4 6 8
Total Leads Required 14 58 148 284

Income Month 1 Month 2 Month 3 Month 4

Bookings (ACV) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Total MRR (Billings) $ 590 $ 3,114 $ 9,470 $ 21,570
Cumulative Billings $ 590 $ 3,704 $ 13,174 $ 34,744
Cumulative Gross Profit $ 472 $ 2,963 $ 10,539 $ 27,795
Growth in MRR $ 590 $ 2,523 $ 6,356 $ 12,100

Expenses
Base Salary $ 8,333 $ 16,667 $ 25,000 $ 33,333
Variable Compensation $ 9,167 $ 15,583 $ 21,633 $ 30,800
Overhead $ 5,000 $ 10,000 $ 15,000 $ 20,000
Cost of leads required $ 1,700 $ 7,312 $ 18,535 $ 35,539
Total Expenses $ 24,200 $ 49,562 $ 80,168 $ 119,673
Cumulative expenses $ 24,200 $ 73,762 $ 153,931 $ 273,603

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net profit $ (23,728) $ (47,071) $ (72,592) $ (102,417)
Cumulative Net Profit $ (23,728) $ (70,799) $ (143,391) $ (245,808)

Net profit Cumulative N

$150,000 $-
$100,000 1 3 5 7 9
nth nth nth nth nth th 1
$(500,000)
o o o o o n
$50,000 M M M M M Mo M

$- $(1,000,000)
1 3 5 7 9 11 13 15 17 19 21 23
$(50,000)
nth n th nth n th nth th th th th th th th $(1,500,000)
o o o o o on on on on on on on
M M M M M M M M M M M M
$(100,000)
$(2,000,000)
$(150,000)

$(200,000) $(2,500,000)

$(250,000) $(3,000,000)

Total MRR (Billings) Growth in

$1,400,000 $120,000
$1,200,000
$100,000
$1,000,000
$80,000
$800,000
$60,000
$600,000
$400,000 $40,000

$200,000 $20,000
$- $-
1 3 5 7 9 11 13 15 17 19 21 23 1 3 5 7 9 1
th th th th th th th th th th th th th nth nth nth nth th 1
on on on on on on on on on on on on on o o o o n
M M M M M M M M M M M M M M M M M Mo M
Part 3: Look at the impact of collecting 1 year's payment in advance

Step 1: Individual Sales person

Income Month 1 Month 2 Month 3 Month 4
Productivity Ramp 10% 33% 66% 100%
Bookings (ACV) $ 3,542 $ 11,688 $ 23,375 $ 35,417
Renewable contract value
Churn
Renewals (renewable - churn)
Billings (bookings + renewals) $ 3,542 $ 11,688 $ 23,375 $ 35,417
Cumulative Billings $ 3,542 $ 15,229 $ 38,604 $ 74,021
Cumulative Gross Profit $ 2,833 $ 12,183 $ 30,883 $ 59,217

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net Cash Flows $ (9,267) $ (3,331) $ 3,397 $ 8,581
Cumulative Net Cash Flows $ (9,267) $ (12,598) $ (9,201) $ (620)

Net Cash Flows Cum

$450,000
$35,000
$400,000
$30,000
$350,000
$25,000 $300,000
$20,000 $250,000
$15,000 $200,000
$10,000 $150,000
$5,000 $100,000
$50,000
$-
$-
$(5,000)th 1 th 2 th 3 th 4 th 5 th 6 th 7 th 8 th 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 $(50,000)h 1 h 2 h 3 h 4 h 5 h
h h h h h h h h h h h h h h h
on on on on on on on on on nt nt nt nt nt nt nt nt nt nt nt nt nt nt nt t t t t t t
M M M M M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo
$(10,000) on on on on on on
M M M M M M M
$(15,000)

Step 2: Look at the Overall Economics when Ramping Sales Hires

Income Month 1 Month 2 Month 3 Month 4
Bookings (ACV) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Billings less churn (MRR) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Cumulative Billings $ 7,083 $ 37,542 $ 114,750 $ 262,792
Cumulative Gross Profit $ 5,667 $ 30,033 $ 91,800 $ 210,233
Growth in MRR $ 7,083 $ 23,375 $ 46,750 $ 70,833
Breakeven Analysis Month 1 Month 2 Month 3 Month 4
Net Cash Flows $ (6,434) $ 11,686 $ 46,464 $ 98,681
Cumulative Net Cash Flows $ (18,534) $ (19,529) $ 11,632 $ 90,561

Net Cash Flows Cumul

$2,500,000 $40,000,000
$35,000,000
$2,000,000
$30,000,000
$1,500,000 $25,000,000
$20,000,000
$1,000,000 $15,000,000
$10,000,000
$500,000
$5,000,000
$- $-
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 $(5,000,000)h 1 h 3 h 5 h 7 h
th th th th th h h h h h h h h h h h h h t t t t t
on on on on on ont ont ont ont ont ont ont ont ont ont ont ont ont
$(500,000) on on on on on
M M M M M M M M M M M M M M M M M M M M M M M M
 Cells formated like this: are input variables

0% 0% 0% 0% 0%
100% 100% 100% 100% 100%

account for failed sales hires and attrition

Quick Marketing Calculation

50% amount of traffic that is organic versus paid
$1.50 cost per paid visitor (Google AdWords, etc.)
$ 0.75 Cost per visitor (both paid and unpaid)
3% visitors convert to raw leads
20% number of raw leads that turn into qualified leads

1 qualified lead
5 raw leads required
167 visitors required
e sales person $125 Cost of visitors (also = Cost per qualified lead)

ting, and sales management. (CAC= Cost to Acquire a Customer)

monthly gross profit per customer (ARPU x Gross Margin ) by the churn rate

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

100% 100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 6,050 $ 8,850 $ 11,580 $ 14,242 $ 16,838 $ 19,368 $ 21,835
$ (151.25) $ (221.25) $ (289.51) $ (356.05) $ (420.94) $ (484.20) $ (545.88)
$ 8,850 $ 11,580 $ 14,242 $ 16,838 $ 19,368 $ 21,835 $ 24,241
$ 19,635 $ 31,215 $ 45,458 $ 62,295 $ 81,663 $ 103,498 $ 127,739
 $ 15,708 $ 24,972 $ 36,366 $ 49,836 $ 65,330 $ 82,799 $ 102,191

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 79,589 $ 99,341 $ 119,093 $ 138,845 $ 158,597 $ 178,350 $ 198,102

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ (12,672) $ (10,488) $ (8,358) $ (6,282) $ (4,258) $ (2,284) $ (360)
$ (63,880) $ (74,368) $ (82,727) $ (89,009) $ (93,267) $ (95,551) $ (95,911)

MRR - Single Sales Hire MRR Versus Expen

$30,000 $30,000

$25,000 $25,000

$20,000 $20,000
Churn
$15,000 MRR from prior months $15,000
bookings
$10,000 New MRR added this month Axis Title $10,000

$5,000 $5,000

$- $-
1 2 3 4 5 6 7 8 9 0 1 2 1 3 5 7 9 1
th th th th th th th th th h 1 h 1 h 1 n th nth n th nth n th th
on on on on on on on on on ont ont ont
$(5,000)
M
o
M
o
M
o
M
o
M
o on
M M M M M M M M M M M M M

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

2 2 2 2 2 2 2
10 12 14 16 18 20 22
420 555 691 827 963 1,098 1,234

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 39,270 $ 62,431 $ 90,915 $ 124,590 $ 163,326 $ 206,997 $ 255,478
$ 74,014 $ 136,445 $ 227,360 $ 351,951 $ 515,277 $ 722,273 $ 977,751
$ 59,211 $ 109,156 $ 181,888 $ 281,560 $ 412,221 $ 577,819 $ 782,201
 $ 17,700 $ 23,161 $ 28,484 $ 33,675 $ 38,736 $ 43,670 $ 48,481

$ 41,667 $ 50,000 $ 58,333 $ 66,667 $ 75,000 $ 83,333 $ 91,667

$ 39,967 $ 49,133 $ 58,300 $ 67,467 $ 76,633 $ 85,800 $ 94,967
$ 25,000 $ 30,000 $ 35,000 $ 40,000 $ 45,000 $ 50,000 $ 55,000
$ 52,544 $ 69,548 $ 86,553 $ 103,557 $ 120,561 $ 137,566 $ 154,570
$ 159,177 $ 198,681 $ 238,186 $ 277,690 $ 317,195 $ 356,699 $ 396,204
$ 432,780 $ 631,462 $ 869,647 $ 1,147,338 $ 1,464,532 $ 1,821,232 $ 2,217,435

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ (127,761) $ (148,737) $ (165,454) $ (178,018) $ (186,534) $ (191,102) $ (191,821)
$ (373,569) $ (522,306) $ (687,759) $ (865,777) $ (1,052,311) $ (1,243,413) $ (1,435,234)

Cumulative Net Profit Cumulative Net Profit

$- $4,000,000
1 3 5 7 9 11 13 15 17 19 21 23
th th th th th h h h h h h h $3,000,000
on on on on on ont ont ont ont ont ont ont
$(500,000)
M M M M M M M M M M M M
$2,000,000
$(1,000,000)
$1,000,000
$(1,500,000)
$-
$(2,000,000) 1 3 5 7 9 1 3 5 7 9 1 3
$(1,000,000)
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2 th
o o o o o n n n n n n n n
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo M
$(2,500,000) $(2,000,000)

$(3,000,000) $(3,000,000)

Growth in MRR
$120,000

$100,000

$80,000

$60,000

$40,000

$20,000

$-
1 3 5 7 9 1 3 5 7 9 1 3
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2
o o o o o n n n n n n n
M M M M M Mo Mo Mo Mo Mo Mo Mo
 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
100% 100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417

$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417

$ 109,438 $ 144,854 $ 180,271 $ 215,688 $ 251,104 $ 286,521 $ 321,938
$ 87,550 $ 115,883 $ 144,217 $ 172,550 $ 200,883 $ 229,217 $ 257,550

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581
$ 7,961 $ 16,543 $ 25,124 $ 33,705 $ 42,286 $ 50,867 $ 59,448

Cumulative Net Cash Flows Cashflow compariso

$450,000 year in advance
$400,000
$350,000 $40,000
$300,000 $30,000
$250,000
$200,000 $20,000
$150,000
$100,000 Axis Title $10,000
$50,000
$-
$- 1 3 5 7 9
$(50,000)h 1 h 2 h 3 h 4 h 5 h 6 h 7 h 8 h 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 n th nth nth nth nth
$(10,000)
o o o o o n
t t t t t t t t t h h h h h h h h h h h h h h h M M M M M Mo
on on on on on on on on on nt nt nt nt nt nt nt nt nt nt nt nt nt nt nt
M M M M M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo
$(20,000)

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 481,667 $ 771,375 $ 1,131,917 $ 1,563,292 $ 2,065,500 $ 2,638,542 $ 3,282,417
$ 385,333 $ 617,100 $ 905,533 $ 1,250,633 $ 1,652,400 $ 2,110,833 $ 2,625,933
$ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833
 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
$ 155,348 $ 212,014 $ 268,681 $ 325,348 $ 382,014 $ 438,681 $ 495,348
$ 226,156 $ 418,419 $ 667,347 $ 972,943 $ 1,335,205 $ 1,754,134 $ 2,229,730

Cumulative Net Cash Flows Cashflow comparison

$40,000,000 year in advance
$35,000,000 $2,500,000
$30,000,000
$25,000,000 $2,000,000

$20,000,000 $1,500,000
$15,000,000
$1,000,000
$10,000,000 Axis Title
$5,000,000 $500,000
$-
$-
$(5,000,000)h 1 h 3 h 5 h 7 h 9 11 13 15 17 19 21 23 25 27 29 31 33 35 1 5 9 3
t t t t t h h h h h h h h h h h h h th nth nth th 1 t
on on on on on nt nt nt nt nt nt nt nt nt nt nt nt nt n
$(500,000)
o o o n n
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo M M M Mo Mo
 Month 12 Month 13 Month 14 Month 15 Month 16 Month 17
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 24,241 $ 26,586 $ 28,873 $ 31,102 $ 33,276 $ 35,396
$ (606.02) $ (664.65) $ (721.82) $ (777.56) $ (831.90) $ (884.89)
$ 26,586 $ 28,873 $ 31,102 $ 33,276 $ 35,396 $ 37,462
$ 154,325 $ 183,198 $ 214,300 $ 247,576 $ 282,972 $ 320,434
 $ 123,460 $ 146,558 $ 171,440 $ 198,061 $ 226,378 $ 256,347

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 217,854 $ 237,606 $ 257,358 $ 277,111 $ 296,863 $ 316,615

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 1,517 $ 3,346 $ 5,130 $ 6,869 $ 8,564 $ 10,218
$ (94,394) $ (91,048) $ (85,918) $ (79,050) $ (70,485) $ (60,268)

MRR Versus Expenses Net profit - New Sales Hire

$25,000
$20,000
$15,000

Total MRR (Billings) $10,000

Total Expenses $5,000
$-
$(5,000)th 1 th 3 th 5 th 7 th 9 h 11 h 13 h 15 h 17 h 19 h 21 h 23
on on on on on ont on
t
on
t
on
t
on
t
on
t
on
t
M
$(10,000) M M M M M M M M M M M
3 5 7 9 11
th n th nth n th th $(15,000)
o o o on
M M M M $(20,000)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

2 2 2 2 2 2
24 26 28 30 32 34
1,370 1,506 1,641 1,777 1,913 2,049

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 714,708 $ 785,542 $ 856,375 $ 927,208 $ 998,042 $ 1,068,875
$ 308,650 $ 366,396 $ 428,600 $ 495,153 $ 565,944 $ 640,868
$ 1,286,401 $ 1,652,797 $ 2,081,397 $ 2,576,550 $ 3,142,493 $ 3,783,362
$ 1,029,121 $ 1,322,237 $ 1,665,118 $ 2,061,240 $ 2,513,995 $ 3,026,689
 $ 53,172 $ 57,746 $ 62,205 $ 66,552 $ 70,791 $ 74,924

$ 100,000 $ 108,333 $ 116,667 $ 125,000 $ 133,333 $ 141,667

$ 104,133 $ 113,300 $ 122,467 $ 131,633 $ 140,800 $ 149,967
$ 60,000 $ 65,000 $ 70,000 $ 75,000 $ 80,000 $ 85,000
$ 171,575 $ 188,579 $ 205,584 $ 222,588 $ 239,592 $ 256,597
$ 435,708 $ 475,212 $ 514,717 $ 554,221 $ 593,726 $ 633,230
$ 2,653,143 $ 3,128,356 $ 3,643,072 $ 4,197,294 $ 4,791,019 $ 5,424,250

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ (188,788) $ (182,096) $ (171,837) $ (158,099) $ (140,971) $ (120,536)
$ (1,624,022) $ (1,806,118) $ (1,977,955) $ (2,136,054) $ (2,277,025) $ (2,397,560)

lative Net Profit

13 1 5 1 7 1 9 2 1 2 3 2 5 2 7 2 9 31 3 3 35
th nth nth nth nth nth nth nth nth nth nth nth
o o o o o o o o o o o
M M M M M M M M M M M
 Month 12 Month 13 Month 14 Month 15 Month 16 Month 17
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 3,542 $ 11,688 $ 23,375 $ 35,417 $ 35,417 $ 35,417
$ (1,062.50) $ (3,506.25) $ (7,012.50) $ (10,625.00) $ (10,625.00) $ (10,625.00)
$ 2,479 $ 8,181 $ 16,363 $ 24,792 $ 24,792 $ 24,792
$ 37,896 $ 43,598 $ 51,779 $ 60,208 $ 60,208 $ 60,208
$ 359,833 $ 403,431 $ 455,210 $ 515,419 $ 575,627 $ 635,835
$ 287,867 $ 322,745 $ 364,168 $ 412,335 $ 460,502 $ 508,668

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 10,564 $ 15,126 $ 21,671 $ 28,414 $ 28,414 $ 28,414
$ 70,013 $ 85,139 $ 106,810 $ 135,224 $ 163,639 $ 192,053

hflow comparison - monthly payments vs Cumulative Cashflow comparision

r in advance payments vs year in advance
$40,000 $500,000

$30,000 $400,000
Net profit $300,000 Cum
$20,000 Net Cash Flows Cum
$200,000
e $10,000 Axis Title
$100,000
$-
1 3 5 7 9 1 3 5 7 9 1 3 $-
n th nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2 1 4 7 0 3 6 9 2
$(10,000)
o o o o o n n n n n n n th nth nth th 1 th 1 th 1 th 1 th 2
M M M M M Mo Mo Mo Mo Mo Mo Mo $(100,000)
n
o o o n n n n n
M M M Mo Mo Mo Mo Mo
$(20,000) $(200,000)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 714,708 $ 785,542 $ 856,375 $ 927,208 $ 998,042 $ 1,068,875
$ 714,708 $ 787,667 $ 865,513 $ 950,371 $ 1,042,454 $ 1,134,538
$ 3,997,125 $ 4,784,792 $ 5,650,304 $ 6,600,675 $ 7,643,129 $ 8,777,667
$ 3,197,700 $ 3,827,833 $ 4,520,243 $ 5,280,540 $ 6,114,503 $ 7,022,133
$ 70,833 $ 72,958 $ 77,846 $ 84,858 $ 92,083 $ 92,083
 Month 12 Month 13 Month 14 Month 15 Month 16 Month 17
$ 552,014 $ 610,381 $ 672,658 $ 740,544 $ 814,211 $ 887,878
$ 2,761,992 $ 3,352,621 $ 4,005,526 $ 4,726,319 $ 5,520,778 $ 6,388,903

flow comparison - monthly payments vs Cumulative Cashflow comparisi

in advance payments vs year in advance
$2,500,000 $40,000,000
$2,000,000 $35,000,000
$30,000,000
$1,500,000 Net profit $25,000,000
Net Cash Flows
$20,000,000
$1,000,000
$15,000,000
Axis Title
$500,000 $10,000,000
$5,000,000
$- $-
1 5 9 3 7 1 5 9 3
n th nth nth th 1 th 1 th 2 th 2 th 2 th 3 $(5,000,000) 1 6 1 6 1 6 1 6
th th h 1 h 1 h 2 h 2 h 3 h 3
$(500,000)
o o o n n n n n n
M M M Mo Mo Mo Mo Mo Mo on on ont ont ont ont ont ont
M M M M M M M M
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 37,462 $ 39,477 $ 41,441 $ 43,357 $ 45,224 $ 47,045
$ (936.55) $ (986.92) $ (1,036.04) $ (1,083.92) $ (1,130.61) $ (1,176.13)
$ 39,477 $ 41,441 $ 43,357 $ 45,224 $ 47,045 $ 48,820
$ 359,911 $ 401,353 $ 444,709 $ 489,934 $ 536,979 $ 585,799
 $ 287,929 $ 321,082 $ 355,767 $ 391,947 $ 429,583 $ 468,639

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 336,367 $ 356,119 $ 375,872 $ 395,624 $ 415,376 $ 435,128

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 11,829 $ 13,401 $ 14,933 $ 16,427 $ 17,884 $ 19,304
$ (48,438) $ (35,037) $ (20,104) $ (3,677) $ 14,207 $ 33,511

ew Sales Hire Cumulative Net Profit - New Sales Hire

$500,000

$400,000

$300,000

$200,000

$100,000
11 13 15 17 19 21 23
th th th th th th $-
on on on on on on
M M M M M M 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5
$(100,000)
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2 th 2 th 2 th 2 th 3 th 3 th 3
o o o o o n n n n n n n n n n n n n
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo
$(200,000)

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

2 2 2 2 2 2
36 38 40 42 44 46
2,184 2,320 2,456 2,592 2,727 2,863

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 1,139,708 $ 1,210,542 $ 1,281,375 $ 1,352,208 $ 1,423,042 $ 1,493,875
$ 719,822 $ 802,705 $ 889,419 $ 979,867 $ 1,073,957 $ 1,171,598
$ 4,503,184 $ 5,305,889 $ 6,195,308 $ 7,175,175 $ 8,249,132 $ 9,420,731
$ 3,602,547 $ 4,244,711 $ 4,956,246 $ 5,740,140 $ 6,599,306 $ 7,536,584
$ 78,954 $ 82,883 $ 86,714 $ 90,449 $ 94,090 $ 97,641

$ 150,000 $ 158,333 $ 166,667 $ 175,000 $ 183,333 $ 191,667

$ 159,133 $ 168,300 $ 177,467 $ 186,633 $ 195,800 $ 204,967
$ 90,000 $ 95,000 $ 100,000 $ 105,000 $ 110,000 $ 115,000
$ 273,601 $ 290,606 $ 307,610 $ 324,615 $ 341,619 $ 358,623
$ 672,735 $ 712,239 $ 751,743 $ 791,248 $ 830,752 $ 870,257
$ 6,096,984 $ 6,809,223 $ 7,560,967 $ 8,352,214 $ 9,182,967 $ 10,053,223

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ (96,877) $ (70,075) $ (40,208) $ (7,354) $ 28,414 $ 67,022
$ (2,494,437) $ (2,564,512) $ (2,604,720) $ (2,612,074) $ (2,583,661) $ (2,516,639)
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ (10,625.00) $ (10,625.00) $ (10,625.00) $ (10,625.00) $ (10,625.00) $ (10,625.00)
$ 24,792 $ 24,792 $ 24,792 $ 24,792 $ 24,792 $ 24,792
$ 60,208 $ 60,208 $ 60,208 $ 60,208 $ 60,208 $ 60,208
$ 696,044 $ 756,252 $ 816,460 $ 876,669 $ 936,877 $ 997,085
$ 556,835 $ 605,002 $ 653,168 $ 701,335 $ 749,502 $ 797,668

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 28,414 $ 28,414 $ 28,414 $ 28,414 $ 28,414 $ 28,414
$ 220,468 $ 248,882 $ 277,297 $ 305,711 $ 334,126 $ 362,540

e Cashflow comparision - monthly

vs year in advance
0

0 Cumulative Net Profit

Cumulative Net Cash Flows
0

1 4 7 0 3 6 9 2
h th th h 1 h 1 h 1 h 1 h 2
) on on nt nt nt nt nt
M M Mo Mo Mo Mo Mo
)

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 1,139,708 $ 1,210,542 $ 1,281,375 $ 1,352,208 $ 1,423,042 $ 1,493,875
$ 1,226,621 $ 1,318,704 $ 1,410,788 $ 1,502,871 $ 1,594,954 $ 1,687,038
$ 10,004,288 $ 11,322,992 $ 12,733,779 $ 14,236,650 $ 15,831,604 $ 17,518,642
$ 8,003,430 $ 9,058,393 $ 10,187,023 $ 11,389,320 $ 12,665,283 $ 14,014,913
$ 92,083 $ 92,083 $ 92,083 $ 92,083 $ 92,083 $ 92,083
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
$ 961,544 $ 1,035,211 $ 1,108,878 $ 1,182,544 $ 1,256,211 $ 1,329,878
$ 7,330,695 $ 8,346,154 $ 9,435,280 $ 10,598,072 $ 11,834,531 $ 13,144,657

tive Cashflow comparision - monthly

ts vs year in advance
00,000
00,000
00,000
00,000 Cumulative Net Profit
00,000 Cumulative Net Cash Flows
00,000
00,000
00,000
$-
1 6 1 6 1 6 1 6
00,000)th th h 1 h 1 h 2 h 2 h 3 h 3
on on ont ont ont ont ont ont
M M M M M M M M
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 48,820 $ 50,551 $ 52,239 $ 53,884 $ 55,489 $ 57,053
$ (1,220.51) $ (1,263.78) $ (1,305.97) $ (1,347.11) $ (1,387.21) $ (1,426.32)
$ 50,551 $ 52,239 $ 53,884 $ 55,489 $ 57,053 $ 58,578
$ 636,350 $ 688,589 $ 742,473 $ 797,962 $ 855,014 $ 913,592
 $ 509,080 $ 550,871 $ 593,979 $ 638,369 $ 684,012 $ 730,874

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 454,881 $ 474,633 $ 494,385 $ 514,137 $ 533,889 $ 553,642

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 20,689 $ 22,039 $ 23,355 $ 24,639 $ 25,890 $ 27,110
$ 54,200 $ 76,238 $ 99,594 $ 124,232 $ 150,122 $ 177,232

es Hire

27 29 31 33 35
th th th th
on on on on
M M M

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

2 2 2 2 2 2
48 50 52 54 56 58
2,999 3,135 3,271 3,406 3,542 3,678

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 1,564,708 $ 1,635,542 $ 1,706,375 $ 1,777,208 $ 1,848,042 $ 1,918,875
$ 1,272,700 $ 1,377,178 $ 1,484,947 $ 1,595,924 $ 1,710,029 $ 1,827,185
$ 10,693,431 $ 12,070,609 $ 13,555,556 $ 15,151,479 $ 16,861,508 $ 18,688,693
$ 8,554,745 $ 9,656,487 $ 10,844,445 $ 12,121,183 $ 13,489,207 $ 14,950,954
$ 101,102 $ 104,478 $ 107,768 $ 110,977 $ 114,105 $ 117,156

$ 200,000 $ 208,333 $ 216,667 $ 225,000 $ 233,333 $ 241,667

$ 214,133 $ 223,300 $ 232,467 $ 241,633 $ 250,800 $ 259,967
$ 120,000 $ 125,000 $ 130,000 $ 135,000 $ 140,000 $ 145,000
$ 375,628 $ 392,632 $ 409,637 $ 426,641 $ 443,646 $ 460,650
$ 909,761 $ 949,266 $ 988,770 $ 1,028,274 $ 1,067,779 $ 1,107,283
$ 10,962,984 $ 11,912,250 $ 12,901,020 $ 13,929,294 $ 14,997,073 $ 16,104,357

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 108,399 $ 152,477 $ 199,187 $ 248,464 $ 300,244 $ 354,464
$ (2,408,240) $ (2,255,763) $ (2,056,575) $ (1,808,111) $ (1,507,867) $ (1,153,402)
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 35,417 $ 37,896 $ 43,598 $ 51,779 $ 60,208 $ 60,208
$ (10,625.00) $ (11,368.75) $ (13,079.38) $ (15,533.75) $ (18,062.50) $ (18,062.50)
$ 24,792 $ 26,527 $ 30,519 $ 36,245 $ 42,146 $ 42,146
$ 60,208 $ 61,944 $ 65,935 $ 71,662 $ 77,563 $ 77,563
$ 1,057,294 $ 1,119,238 $ 1,185,173 $ 1,256,835 $ 1,334,397 $ 1,411,960
$ 845,835 $ 895,390 $ 948,138 $ 1,005,468 $ 1,067,518 $ 1,129,568

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 28,414 $ 29,803 $ 32,996 $ 37,577 $ 42,298 $ 42,298
$ 390,954 $ 420,757 $ 453,753 $ 491,331 $ 533,628 $ 575,926

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 1,564,708 $ 1,635,542 $ 1,706,375 $ 1,777,208 $ 1,848,042 $ 1,918,875
$ 1,779,121 $ 1,871,842 $ 1,966,029 $ 2,062,320 $ 2,160,778 $ 2,259,236
$ 19,297,763 $ 21,169,604 $ 23,135,633 $ 25,197,953 $ 27,358,730 $ 29,617,967
$ 15,438,210 $ 16,935,683 $ 18,508,506 $ 20,158,362 $ 21,886,984 $ 23,694,373
$ 92,083 $ 92,721 $ 94,187 $ 96,291 $ 98,458 $ 98,458
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
$ 1,403,544 $ 1,477,721 $ 1,553,071 $ 1,630,103 $ 1,708,870 $ 1,787,637
$ 14,528,449 $ 15,986,418 $ 17,519,736 $ 19,130,088 $ 20,819,205 $ 22,587,090
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 58,578 $ 60,065 $ 61,514 $ 62,928 $ 64,306 $ 65,650
$ (1,464.44) $ (1,501.62) $ (1,537.86) $ (1,573.20) $ (1,607.65) $ (1,641.25)
$ 60,065 $ 61,514 $ 62,928 $ 64,306 $ 65,650 $ 66,960
$ 973,657 $ 1,035,171 $ 1,098,099 $ 1,162,406 $ 1,228,056 $ 1,295,016
$ 778,926 $ 828,137 $ 878,480 $ 929,925 $ 982,444 $ 1,036,013

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 573,394 $ 593,146 $ 612,898 $ 632,650 $ 652,403 $ 672,155

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 28,300 $ 29,459 $ 30,590 $ 31,693 $ 32,768 $ 33,816
$ 205,532 $ 234,991 $ 265,581 $ 297,274 $ 330,042 $ 363,858

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

2 2 2 2 2 2
60 62 64 66 68 70
3,814 3,949 4,085 4,221 4,357 4,492

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 1,989,708 $ 2,060,542 $ 2,131,375 $ 2,202,208 $ 2,273,042 $ 2,343,875
$ 1,947,314 $ 2,070,343 $ 2,196,199 $ 2,324,811 $ 2,456,111 $ 2,590,031
$ 20,636,007 $ 22,706,350 $ 24,902,549 $ 27,227,360 $ 29,683,471 $ 32,273,502
$ 16,508,805 $ 18,165,080 $ 19,922,039 $ 21,781,888 $ 23,746,777 $ 25,818,802
$ 120,129 $ 123,029 $ 125,856 $ 128,612 $ 131,300 $ 133,920

$ 250,000 $ 258,333 $ 266,667 $ 275,000 $ 283,333 $ 291,667

$ 269,133 $ 278,300 $ 287,467 $ 296,633 $ 305,800 $ 314,967
$ 150,000 $ 155,000 $ 160,000 $ 165,000 $ 170,000 $ 175,000
$ 477,654 $ 494,659 $ 511,663 $ 528,668 $ 545,672 $ 562,676
$ 1,146,788 $ 1,186,292 $ 1,225,797 $ 1,265,301 $ 1,304,805 $ 1,344,310
$ 17,251,144 $ 18,437,436 $ 19,663,233 $ 20,928,534 $ 22,233,339 $ 23,577,649

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 411,063 $ 469,982 $ 531,163 $ 594,548 $ 660,084 $ 727,715
$ (742,339) $ (272,357) $ 258,806 $ 853,354 $ 1,513,438 $ 2,241,153
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 60,208 $ 60,208 $ 60,208 $ 60,208 $ 60,208 $ 60,208
$ (18,062.50) $ (18,062.50) $ (18,062.50) $ (18,062.50) $ (18,062.50) $ (18,062.50)
$ 42,146 $ 42,146 $ 42,146 $ 42,146 $ 42,146 $ 42,146
$ 77,563 $ 77,563 $ 77,563 $ 77,563 $ 77,563 $ 77,563
$ 1,489,522 $ 1,567,085 $ 1,644,647 $ 1,722,210 $ 1,799,772 $ 1,877,335
$ 1,191,618 $ 1,253,668 $ 1,315,718 $ 1,377,768 $ 1,439,818 $ 1,501,868

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 42,298 $ 42,298 $ 42,298 $ 42,298 $ 42,298 $ 42,298
$ 618,224 $ 660,522 $ 702,820 $ 745,117 $ 787,415 $ 829,713

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 1,989,708 $ 2,060,542 $ 2,131,375 $ 2,202,208 $ 2,273,042 $ 2,343,875
$ 2,357,695 $ 2,456,153 $ 2,554,611 $ 2,653,070 $ 2,751,528 $ 2,849,986
$ 31,975,661 $ 34,431,814 $ 36,986,425 $ 39,639,495 $ 42,391,023 $ 45,241,009
$ 25,580,529 $ 27,545,451 $ 29,589,140 $ 31,711,596 $ 33,912,818 $ 36,192,807
$ 98,458 $ 98,458 $ 98,458 $ 98,458 $ 98,458 $ 98,458
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
$ 1,866,403 $ 1,945,170 $ 2,023,937 $ 2,102,703 $ 2,181,470 $ 2,260,237
$ 24,433,741 $ 26,359,159 $ 28,363,344 $ 30,446,295 $ 32,608,013 $ 34,848,498
 Month 36
100%
$ 35,417
$ 2,951
$ 66,960
$ (1,674.00)
$ 68,237
$ 1,363,253
$ 1,090,602

$ 4,167
$ 4,583
$ 2,500
$ 8,502
$ 19,752
$ 691,907

Month 36
$ 34,838
$ 398,695

Month 36
2
72
4,628

Month 36
$ 2,414,708
$ 2,726,506
$ 35,000,008
$ 28,000,007
$ 136,475

$ 300,000
$ 324,133
$ 180,000
$ 579,681
$ 1,383,814
$ 24,961,463

Month 36
$ 797,391
$ 3,038,543
 Month 36
100%
$ 35,417
$ 60,208
$ (18,062.50)
$ 42,146
$ 77,563
$ 1,954,897
$ 1,563,918

Month 36
$ 42,298
$ 872,011

Month 36
$ 2,414,708
$ 2,948,445
$ 48,189,454
$ 38,551,563
$ 98,458
 Month 36
$ 2,339,003
$ 37,167,749
Comparison of hiring 1 versus 2 sales people per month

Data for hiring 1 sales person per month

Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

New Sales Hires 1 1 1 1 1 1

No of Salespeople at
each stage in lifecycle Month 1 Month 2 Month 3 Month 4 Month 5 Month 6
1st month 1 1 1 1 1 1
2nd month 1 1 1 1 1
3rd month 1 1 1 1
4th month 1 1 1
5th month 1 1
6th month 1
7th month
4th month
4th month
10th month & Beyond
Total Sales Headcount 1 2 3 4 5 6
Total Leads Required 7 29 74 142 210 278

Income Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

Bookings (ACV) $ 3,542 $ 15,229 $ 38,604 $ 74,021 $ 109,438 $ 144,854
Total MRR (Billings) $ 295 $ 1,557 $ 4,735 $ 10,785 $ 19,635 $ 31,215
Cumulative Billings $ 295 $ 1,852 $ 6,587 $ 17,372 $ 37,007 $ 68,223
Cumulative Gross Profit $ 236 $ 1,482 $ 5,270 $ 13,898 $ 29,606 $ 54,578
Growth in MRR $ 295 $ 1,262 $ 3,178 $ 6,050 $ 8,850 $ 11,580

Expenses
Base Salary $ 4,167 $ 8,333 $ 12,500 $ 16,667 $ 20,833 $ 25,000
Variable Compensation $ 4,583 $ 7,792 $ 10,817 $ 15,400 $ 19,983 $ 24,567
Overhead $ 2,500 $ 5,000 $ 7,500 $ 10,000 $ 12,500 $ 15,000
Cost of leads required $ 850 $ 3,656 $ 9,267 $ 17,770 $ 26,272 $ 34,774
Total Expenses $ 12,100 $ 24,781 $ 40,084 $ 59,836 $ 79,589 $ 99,341
Cumulative expenses $ 12,100 $ 36,881 $ 76,965 $ 136,802 $ 216,390 $ 315,731

Breakeven Analysis Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

Net profit $ (11,864) $ (23,535) $ (36,296) $ (51,208) $ (63,880) $ (74,368)
Cumulative Net Profit $ (11,864) $ (35,400) $ (71,696) $ (122,904) $ (186,784) $ (261,153)
Graphing Data

MRR Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

1 sales hire a month $ 295 $ 1,557 $ 4,735 $ 10,785 $ 19,635 $ 31,215
2 sales hires a month $ 590 $ 3,114 $ 9,470 $ 21,570 $ 39,270 $ 62,431

Growth in MRR Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

1 sales hire a month $ 295 $ 1,262 $ 3,178 $ 6,050 $ 8,850 $ 11,580
2 sales hires a month $ 590 $ 2,523 $ 6,356 $ 12,100 $ 17,700 $ 23,161

Net Profit Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

1 sales hire a month $ (11,864) $ (23,535) $ (36,296) $ (51,208) $ (63,880) $ (74,368)
2 sales hires a month $ (23,728) $ (47,071) $ (72,592) $ (102,417) $ (127,761) $ (148,737)

Cumulative Net Profit Month 1 Month 2 Month 3 Month 4 Month 5 Month 6

1 sales hire a month $ (11,864) $ (35,400) $ (71,696) $ (122,904) $ (186,784) $ (261,153)
2 sales hires a month $ (23,728) $ (70,799) $ (143,391) $ (245,808) $ (373,569) $ (522,306)

MRR MR
$3,000,000 $160,000
$140,000
$2,500,000
$120,000
$2,000,000
$100,000
$1,500,000 1 sales hire a month $80,000
2 sales hires a month
$60,000
Axis Title $1,000,000 Axis Title
$40,000
$500,000
$20,000
$- $-
1 5 9 3 7 1 5 9 3 1 5 9 3
nth nth nth th 1 th 1 th 2 th 2 th 2 th 3 n th nth nth th 1 th
o o o n n n n n n o o o n n
M M M Mo Mo Mo Mo Mo Mo M M M Mo Mo
 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13
1 1 1 1 1 1 1

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1
1 2 3 4
7 8 9 10 11 12 13
346 413 481 549 617 685 753

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

$ 180,271 $ 215,688 $ 251,104 $ 286,521 $ 321,938 $ 357,354 $ 392,771
$ 45,458 $ 62,295 $ 81,663 $ 103,498 $ 127,739 $ 154,325 $ 183,198
$ 113,680 $ 175,975 $ 257,638 $ 361,137 $ 488,876 $ 643,201 $ 826,398
$ 90,944 $ 140,780 $ 206,111 $ 288,909 $ 391,101 $ 514,560 $ 661,119
$ 14,242 $ 16,838 $ 19,368 $ 21,835 $ 24,241 $ 26,586 $ 28,873

$ 29,167 $ 33,333 $ 37,500 $ 41,667 $ 45,833 $ 50,000 $ 54,167

$ 29,150 $ 33,733 $ 38,317 $ 42,900 $ 47,483 $ 52,067 $ 56,650
$ 17,500 $ 20,000 $ 22,500 $ 25,000 $ 27,500 $ 30,000 $ 32,500
$ 43,276 $ 51,778 $ 60,281 $ 68,783 $ 77,285 $ 85,787 $ 94,290
$ 119,093 $ 138,845 $ 158,597 $ 178,350 $ 198,102 $ 217,854 $ 237,606
$ 434,824 $ 573,669 $ 732,266 $ 910,616 $ 1,108,718 $ 1,326,572 $ 1,564,178

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

$ (82,727) $ (89,009) $ (93,267) $ (95,551) $ (95,911) $ (94,394) $ (91,048)
$ (343,880) $ (432,889) $ (526,155) $ (621,706) $ (717,617) $ (812,011) $ (903,059)
 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13
$ 45,458 $ 62,295 $ 81,663 $ 103,498 $ 127,739 $ 154,325 $ 183,198
$ 90,915 $ 124,590 $ 163,326 $ 206,997 $ 255,478 $ 308,650 $ 366,396

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

$ 14,242 $ 16,838 $ 19,368 $ 21,835 $ 24,241 $ 26,586 $ 28,873
$ 28,484 $ 33,675 $ 38,736 $ 43,670 $ 48,481 $ 53,172 $ 57,746

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

$ (82,727) $ (89,009) $ (93,267) $ (95,551) $ (95,911) $ (94,394) $ (91,048)
$ (165,454) $ (178,018) $ (186,534) $ (191,102) $ (191,821) $ (188,788) $ (182,096)

Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Month 13

$ (343,880) $ (432,889) $ (526,155) $ (621,706) $ (717,617) $ (812,011) $ (903,059)
$ (687,759) $ (865,777) $ (1,052,311) $ (1,243,413) $ (1,435,234) $ (1,624,022) $ (1,806,118)

MRR Growth Net Profit

$160,000
$1,000,000
$140,000
$120,000 $800,000
$100,000 $600,000
$80,000 1 sales hire a month
2 sales hires a month $400,000
$60,000
Axis Title
$40,000 $200,000
$20,000
$-
$- 1 5 9 3 7 1 5 9 3
1 5 9 3 7 1 5 9 3 th nth nth th 1 th 1 th 2 th 2 th 2 th 3
n th nth nth th 1 th 1 th 2 th 2 th 2 th 3 n
$(200,000)
o o o n n n n n n
o o o n n n n n n M M M Mo Mo Mo Mo Mo Mo
M M M Mo Mo Mo Mo Mo Mo
$(400,000)
 Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20
1 1 1 1 1 1 1

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
1 1 1 1 1 1 1
5 6 7 8 9 10 11
14 15 16 17 18 19 20
821 889 956 1,024 1,092 1,160 1,228

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

$ 428,188 $ 463,604 $ 499,021 $ 534,438 $ 569,854 $ 605,271 $ 640,688
$ 214,300 $ 247,576 $ 282,972 $ 320,434 $ 359,911 $ 401,353 $ 444,709
$ 1,040,698 $ 1,288,275 $ 1,571,247 $ 1,891,681 $ 2,251,592 $ 2,652,945 $ 3,097,654
$ 832,559 $ 1,030,620 $ 1,256,997 $ 1,513,345 $ 1,801,274 $ 2,122,356 $ 2,478,123
$ 31,102 $ 33,276 $ 35,396 $ 37,462 $ 39,477 $ 41,441 $ 43,357

$ 58,333 $ 62,500 $ 66,667 $ 70,833 $ 75,000 $ 79,167 $ 83,333

$ 61,233 $ 65,817 $ 70,400 $ 74,983 $ 79,567 $ 84,150 $ 88,733
$ 35,000 $ 37,500 $ 40,000 $ 42,500 $ 45,000 $ 47,500 $ 50,000
$ 102,792 $ 111,294 $ 119,796 $ 128,298 $ 136,801 $ 145,303 $ 153,805
$ 257,358 $ 277,111 $ 296,863 $ 316,615 $ 336,367 $ 356,119 $ 375,872
$ 1,821,536 $ 2,098,647 $ 2,395,510 $ 2,712,125 $ 3,048,492 $ 3,404,612 $ 3,780,483

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

$ (85,918) $ (79,050) $ (70,485) $ (60,268) $ (48,438) $ (35,037) $ (20,104)
$ (988,977) $ (1,068,027) $ (1,138,512) $ (1,198,780) $ (1,247,219) $ (1,282,256) $ (1,302,360)
 Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20
$ 214,300 $ 247,576 $ 282,972 $ 320,434 $ 359,911 $ 401,353 $ 444,709
$ 428,600 $ 495,153 $ 565,944 $ 640,868 $ 719,822 $ 802,705 $ 889,419

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

$ 31,102 $ 33,276 $ 35,396 $ 37,462 $ 39,477 $ 41,441 $ 43,357
$ 62,205 $ 66,552 $ 70,791 $ 74,924 $ 78,954 $ 82,883 $ 86,714

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

$ (85,918) $ (79,050) $ (70,485) $ (60,268) $ (48,438) $ (35,037) $ (20,104)
$ (171,837) $ (158,099) $ (140,971) $ (120,536) $ (96,877) $ (70,075) $ (40,208)

Month 14 Month 15 Month 16 Month 17 Month 18 Month 19 Month 20

$ (988,977) $ (1,068,027) $ (1,138,512) $ (1,198,780) $ (1,247,219) $ (1,282,256) $ (1,302,360)
$ (1,977,955) $ (2,136,054) $ (2,277,025) $ (2,397,560) $ (2,494,437) $ (2,564,512) $ (2,604,720)

et Profit Cumulative Net Profit

$4,000,000

$3,000,000

$2,000,000
1 sales hire a month 1 sales hire a month
2 sales hires a month $1,000,000 2 sales hires a month
Axis Title
$-
1 5 9 3 7 1 5 9 3
nth nth nth th 1 th 1 th 2 th 2 th 2 th 3
$(1,000,000)
o o o n n n n n n
M M M Mo Mo Mo Mo Mo Mo
1 7 2 1 2 5 29 3 3
h th th th th $(2,000,000)
on on on on
M M M M
$(3,000,000)
 Month 21 Month 22 Month 23 Month 24 Month 25 Month 26
1 1 1 1 1 1

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
12 13 14 15 16 17
21 22 23 24 25 26
1,296 1,364 1,432 1,500 1,567 1,635

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

$ 676,104 $ 711,521 $ 746,938 $ 782,354 $ 817,771 $ 853,188
$ 489,934 $ 536,979 $ 585,799 $ 636,350 $ 688,589 $ 742,473
$ 3,587,588 $ 4,124,566 $ 4,710,365 $ 5,346,716 $ 6,035,305 $ 6,777,778
$ 2,870,070 $ 3,299,653 $ 3,768,292 $ 4,277,372 $ 4,828,244 $ 5,422,222
$ 45,224 $ 47,045 $ 48,820 $ 50,551 $ 52,239 $ 53,884

$ 87,500 $ 91,667 $ 95,833 $ 100,000 $ 104,167 $ 108,333

$ 93,317 $ 97,900 $ 102,483 $ 107,067 $ 111,650 $ 116,233
$ 52,500 $ 55,000 $ 57,500 $ 60,000 $ 62,500 $ 65,000
$ 162,307 $ 170,809 $ 179,312 $ 187,814 $ 196,316 $ 204,818
$ 395,624 $ 415,376 $ 435,128 $ 454,881 $ 474,633 $ 494,385
$ 4,176,107 $ 4,591,483 $ 5,026,612 $ 5,481,492 $ 5,956,125 $ 6,450,510

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

$ (3,677) $ 14,207 $ 33,511 $ 54,200 $ 76,238 $ 99,594
$ (1,306,037) $ (1,291,830) $ (1,258,319) $ (1,204,120) $ (1,127,881) $ (1,028,288)
 Month 21 Month 22 Month 23 Month 24 Month 25 Month 26
$ 489,934 $ 536,979 $ 585,799 $ 636,350 $ 688,589 $ 742,473
$ 979,867 $ 1,073,957 $ 1,171,598 $ 1,272,700 $ 1,377,178 $ 1,484,947

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

$ 45,224 $ 47,045 $ 48,820 $ 50,551 $ 52,239 $ 53,884
$ 90,449 $ 94,090 $ 97,641 $ 101,102 $ 104,478 $ 107,768

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

$ (3,677) $ 14,207 $ 33,511 $ 54,200 $ 76,238 $ 99,594
$ (7,354) $ 28,414 $ 67,022 $ 108,399 $ 152,477 $ 199,187

Month 21 Month 22 Month 23 Month 24 Month 25 Month 26

$ (1,306,037) $ (1,291,830) $ (1,258,319) $ (1,204,120) $ (1,127,881) $ (1,028,288)
$ (2,612,074) $ (2,583,661) $ (2,516,639) $ (2,408,240) $ (2,255,763) $ (2,056,575)

1 sales hire a month

2 sales hires a month
 Month 27 Month 28 Month 29 Month 30 Month 31 Month 32
1 1 1 1 1 1

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
1 1 1 1 1 1
18 19 20 21 22 23
27 28 29 30 31 32
1,703 1,771 1,839 1,907 1,975 2,043

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

$ 888,604 $ 924,021 $ 959,438 $ 994,854 $ 1,030,271 $ 1,065,688
$ 797,962 $ 855,014 $ 913,592 $ 973,657 $ 1,035,171 $ 1,098,099
$ 7,575,740 $ 8,430,754 $ 9,344,346 $ 10,318,003 $ 11,353,175 $ 12,451,274
$ 6,060,592 $ 6,744,603 $ 7,475,477 $ 8,254,403 $ 9,082,540 $ 9,961,019
$ 55,489 $ 57,053 $ 58,578 $ 60,065 $ 61,514 $ 62,928

$ 112,500 $ 116,667 $ 120,833 $ 125,000 $ 129,167 $ 133,333

$ 120,817 $ 125,400 $ 129,983 $ 134,567 $ 139,150 $ 143,733
$ 67,500 $ 70,000 $ 72,500 $ 75,000 $ 77,500 $ 80,000
$ 213,321 $ 221,823 $ 230,325 $ 238,827 $ 247,329 $ 255,832
$ 514,137 $ 533,889 $ 553,642 $ 573,394 $ 593,146 $ 612,898
$ 6,964,647 $ 7,498,537 $ 8,052,178 $ 8,625,572 $ 9,218,718 $ 9,831,616

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

$ 124,232 $ 150,122 $ 177,232 $ 205,532 $ 234,991 $ 265,581
$ (904,055) $ (753,933) $ (576,701) $ (371,169) $ (136,178) $ 129,403
 Month 27 Month 28 Month 29 Month 30 Month 31 Month 32
$ 797,962 $ 855,014 $ 913,592 $ 973,657 $ 1,035,171 $ 1,098,099
$ 1,595,924 $ 1,710,029 $ 1,827,185 $ 1,947,314 $ 2,070,343 $ 2,196,199

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

$ 55,489 $ 57,053 $ 58,578 $ 60,065 $ 61,514 $ 62,928
$ 110,977 $ 114,105 $ 117,156 $ 120,129 $ 123,029 $ 125,856

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

$ 124,232 $ 150,122 $ 177,232 $ 205,532 $ 234,991 $ 265,581
$ 248,464 $ 300,244 $ 354,464 $ 411,063 $ 469,982 $ 531,163

Month 27 Month 28 Month 29 Month 30 Month 31 Month 32

$ (904,055) $ (753,933) $ (576,701) $ (371,169) $ (136,178) $ 129,403
$ (1,808,111) $ (1,507,867) $ (1,153,402) $ (742,339) $ (272,357) $ 258,806
 Month 33 Month 34 Month 35 Month 36
1 1 1 1

Month 33 Month 34 Month 35 Month 36

1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
1 1 1 1
24 25 26 27
33 34 35 36
2,110 2,178 2,246 2,314

Month 33 Month 34 Month 35 Month 36

$ 1,101,104 $ 1,136,521 $ 1,171,938 $ 1,207,354
$ 1,162,406 $ 1,228,056 $ 1,295,016 $ 1,363,253
$ 13,613,680 $ 14,841,735 $ 16,136,751 $ 17,500,004
$ 10,890,944 $ 11,873,388 $ 12,909,401 $ 14,000,003
$ 64,306 $ 65,650 $ 66,960 $ 68,237

$ 137,500 $ 141,667 $ 145,833 $ 150,000

$ 148,317 $ 152,900 $ 157,483 $ 162,067
$ 82,500 $ 85,000 $ 87,500 $ 90,000
$ 264,334 $ 272,836 $ 281,338 $ 289,840
$ 632,650 $ 652,403 $ 672,155 $ 691,907
$ 10,464,267 $ 11,116,670 $ 11,788,825 $ 12,480,732

Month 33 Month 34 Month 35 Month 36

$ 297,274 $ 330,042 $ 363,858 $ 398,695
$ 426,677 $ 756,719 $ 1,120,576 $ 1,519,272
 Month 33 Month 34 Month 35 Month 36
$ 1,162,406 $ 1,228,056 $ 1,295,016 $ 1,363,253
$ 2,324,811 $ 2,456,111 $ 2,590,031 $ 2,726,506

Month 33 Month 34 Month 35 Month 36

$ 64,306 $ 65,650 $ 66,960 $ 68,237
$ 128,612 $ 131,300 $ 133,920 $ 136,475

Month 33 Month 34 Month 35 Month 36

$ 297,274 $ 330,042 $ 363,858 $ 398,695
$ 594,548 $ 660,084 $ 727,715 $ 797,391

Month 33 Month 34 Month 35 Month 36

$ 426,677 $ 756,719 $ 1,120,576 $ 1,519,272
$ 853,354 $ 1,513,438 $ 2,241,153 $ 3,038,543
Churn Rate Comparison
This is simply a copy of the first tab, with a different churn rate (1.25% versus 2.5%)

Net Profit Month 1 Month 2 Month 3 Month 4

Churn 1.25% $ (23,728) $ (47,065) $ (72,555) $ (102,285)
Churn 2.5% $ (23,728) $ (47,071) $ (72,592) $ (102,417)

Cumulative Net Profit Month 1 Month 2 Month 3 Month 4

Churn 1.25% $ (23,728) $ (70,793) $ (143,349) $ (245,634)
Churn 2.5% $ (23,728) $ (70,799) $ (143,391) $ (245,808)

$1,200,000 $8,000,000

$1,000,000
$6,000,000
$800,000
$4,000,000
$600,000
Churn 1.25%
$400,000 $2,000,000
Churn 2.5%
$200,000
$-
$- 1 4 7 0 3
nth nth nth th 1 th 1 th
1 4 7 10 13 16 19 22 25 28 31 34 o o o n n n
th th th h h h h h h h h h M M M Mo Mo Mo
$(2,000,000)
on on on ont ont ont ont ont ont ont ont ont
$(200,000)
M M M M M M M M M M M M
$(400,000) $(4,000,000)

Part 1: Model the ecomomics of a single sales person

Sales compensation and overhead
Base Compensation $ 50,000
Variable Compensation $ 55,000 with 50% draw for first four months
Draw on Variable Comp 100% 70% 30% 0%
Additional overhead $ 30,000
Sales attrition factor 15% a factor to discount bookings to account for failed sales hires and att

On target annual bookings

Annual Bookings 500,000 ACV (Annual Contract Value)
Monthly Bookings $ 41,667
Churn Rate and Margin
Churn Rate (monthly) 1.25%
Gross Margin 80.00%

Cost of Leads required to feed sales

Average Deal Size $6,000 (ACV) Annual Contract Value
Deals to meet target 6.9 per month
Leads to closed deal 10
Cost per Qualified Lead $125
Cost of Leads required $ 8,698 per month, for 1 fully productive sales person

Other interesting Calculations

Lead Gen costs per deal $ 1,253 Excludes people costs
Selling costs per deal $ 1,620 Excludes cost of sales management
Total CAC $ 2,873 Excludes people costs in marketing, and sales management. (CAC= C
Total LTV $ 32,000 Calculated by dividing average monthly gross profit per customer (AR

Income Month 1 Month 2 Month 3 Month 4

Productivity Ramp 10% 33% 66% 100%
Bookings (ACV) $ 3,542 $ 11,688 $ 23,375 $ 35,417
New MRR added this month $ 295 $ 974 $ 1,948 $ 2,951
MRR from prior months bookings $ 295 $ 1,265 $ 3,198
Churn $ (3.69) $ (15.82) $ (39.97)
Total MRR (Billings) $ 295 $ 1,265 $ 3,198 $ 6,109
Cumulative Billings $ 295 $ 1,561 $ 4,758 $ 10,867
Cumulative Gross Profit $ 236 $ 1,248 $ 3,806 $ 8,694

Expenses
Base Salary $ 4,167 $ 4,167 $ 4,167 $ 4,167
Variable Compensation $ 4,583 $ 3,208 $ 3,025 $ 4,583
Overhead $ 2,500 $ 2,500 $ 2,500 $ 2,500
Cost of leads required $ 850 $ 2,806 $ 5,611 $ 8,502
Total Expenses $ 12,100 $ 12,681 $ 15,303 $ 19,752
Cumulative expenses $ 12,100 $ 24,781 $ 40,084 $ 59,836

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net profit $ (11,864) $ (11,668) $ (12,745) $ (14,865)
Cumulative Net Profit $ (11,864) $ (23,533) $ (36,278) $ (51,143)

Bookings & Churn - Single Sales Hire MRR - Sin

$3,500 $35,000
$3,000 $30,000
 Bookings & Churn - Single Sales Hire MRR - Sin
$3,500 $35,000
$3,000 $30,000
$2,500 $25,000
$2,000 Churn $20,000
$1,500 New MRR added this month $15,000
$1,000 $10,000
$500 $5,000
$- $-
1 2 3 4 5 6 7 8 9 10 1 1 1 2 1 2 3 4 5 6 7 8
$(500)nth nth nth nth nth nth nth nth nth th th th $(5,000)nth nth nth nth nth nth nth nth
o o o o o o o o o on on on o o o o o o o o o
M M M M M M M M M M M M M M M M M M M M M

Part 2: Look at the Overall Economics when Ramping Sales Hires

Month 1 Month 2 Month 3 Month 4

New Sales Hires 2 2 2 2
Total Sales Headcount 2 4 6 8
Total Leads Required 14 58 148 284

Income Month 1 Month 2 Month 3 Month 4

Bookings (ACV) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Total MRR (Billings) $ 590 $ 3,121 $ 9,516 $ 21,734
Cumulative Billings $ 590 $ 3,711 $ 13,227 $ 34,961
Cumulative Gross Profit $ 472 $ 2,969 $ 10,582 $ 27,969
Growth in MRR $ 590 $ 2,531 $ 6,395 $ 12,218

Expenses
Base Salary $ 8,333 $ 16,667 $ 25,000 $ 33,333
Variable Compensation $ 9,167 $ 15,583 $ 21,633 $ 30,800
Overhead $ 5,000 $ 10,000 $ 15,000 $ 20,000
Cost of leads required $ 1,700 $ 7,312 $ 18,535 $ 35,539
Total Expenses $ 24,200 $ 49,562 $ 80,168 $ 119,673
Cumulative expenses $ 24,200 $ 73,762 $ 153,931 $ 273,603

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net profit $ (23,728) $ (47,065) $ (72,555) $ (102,285)
Cumulative Net Profit $ (23,728) $ (70,793) $ (143,349) $ (245,634)

Net profit Cumulative N

$250,000 $-
$200,000 1 3 5 7 9
nth nth nth nth nth th 1
$150,000 o o o o o n
 Net profit Cumulative N
$250,000 $-
$200,000 1 3 5 7 9
nth nth nth nth nth th 1
$150,000 o o o o o n
M M M M M Mo M
$(500,000)
$100,000
$50,000 $(1,000,000)
$-
$(50,000)th 1 th
3
th
5
th
7
th
9 11 13 15 17 19 21 23 $(1,500,000)
n n n n n th th th th th th th
o
$(100,000) o o o o on on on on on on on
M M M M M M M M M M M M
$(150,000) $(2,000,000)
$(200,000)
$(250,000) $(2,500,000)

Total MRR (Billings) Growth in

$1,600,000 $140,000
$1,400,000
$120,000
$1,200,000
$100,000
$1,000,000
$80,000
$800,000
$600,000 $60,000
$400,000 $40,000
$200,000 $20,000
$- $-
1 3 5 7 9 11 13 15 17 19 21 23 1 3 5 7 9 1
th th th th th th th th th th th th th nth nth nth nth th 1
on on on on on on on on on on on on on o o o o n
M M M M M M M M M M M M M M M M M Mo Mo

Part 3: Look at the impact of collecting 1 year's payment in advance

Step 1: Individual Sales person

Income Month 1 Month 2 Month 3 Month 4
Productivity Ramp 10% 33% 66% 100%
Bookings (ACV) $ 3,542 $ 11,688 $ 23,375 $ 35,417
Renewable contract value
Churn
Renewals (renewable - churn)
Billings (bookings + renewals) $ 3,542 $ 11,688 $ 23,375 $ 35,417
Cumulative Billings $ 3,542 $ 15,229 $ 38,604 $ 74,021
Cumulative Gross Profit $ 2,833 $ 12,183 $ 30,883 $ 59,217
Breakeven Analysis Month 1 Month 2 Month 3 Month 4
Net Cash Flows $ (9,267) $ (3,331) $ 3,397 $ 8,581
Cumulative Net Cash Flows $ (9,267) $ (12,598) $ (9,201) $ (620)

Net Cash Flows Cum

$500,000
$40,000
$400,000
$30,000
$300,000
$20,000
$200,000
$10,000
$100,000
$-
1 2 3 4 5 6 7 8 9 0 1 2 3 4 5 6 7 8 9 0 1 2 3 4 $-
n th nth nth nth nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 1 th 1 th 1 th 1 th 1 th 2 th 2 th 2 th 2 th 2
$(10,000)
o o o o o o o o o n n n n n n n n n n n n n n n 1 3 5
M M M M M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo n
$(100,000) th n th n th
o o o
M M M M
$(20,000)

Step 2: Look at the Overall Economics when Ramping Sales Hires

Income Month 1 Month 2 Month 3 Month 4
Bookings (ACV) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Billings less churn (MRR) $ 7,083 $ 30,458 $ 77,208 $ 148,042
Cumulative Billings $ 7,083 $ 37,542 $ 114,750 $ 262,792
Cumulative Gross Profit $ 5,667 $ 30,033 $ 91,800 $ 210,233
Growth in MRR $ 7,083 $ 23,375 $ 46,750 $ 70,833

Breakeven Analysis Month 1 Month 2 Month 3 Month 4

Net Cash Flows $ (6,434) $ 11,686 $ 46,464 $ 98,681
Cumulative Net Cash Flows $ (18,534) $ (19,529) $ 11,632 $ 90,561

Net Cash Flows Cumul

$2,500,000 $40,000,000
$35,000,000
$2,000,000
$30,000,000
$1,500,000 $25,000,000
$20,000,000
$1,000,000 $15,000,000
$10,000,000
$500,000
$5,000,000
$- $-
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 $(5,000,000)h 1 h 3 h 5 h 7 h
th th th th th h h h h h h h h h h h h h t t t t t
on on on on on ont ont ont ont ont ont ont ont ont ont ont ont ont
$(500,000) on on on on on
M M M M M M M M M M M M M M M M M M M M M M M M
 $20,000,000
$1,000,000 $15,000,000
$10,000,000
$500,000
$5,000,000
$- $-
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35 $(5,000,000)h 1 h 3 h 5 h 7 h
th th th th th h h h h h h h h h h h h h t t t t t
on on on on on ont ont ont ont ont ont ont ont ont ont ont ont ont
$(500,000) on on on on on
M M M M M M M M M M M M M M M M M M M M M M M M
 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
$ (127,416) $ (148,003) $ (164,105) $ (175,777) $ (183,075) $ (186,053) $ (184,765)
$ (127,761) $ (148,737) $ (165,454) $ (178,018) $ (186,534) $ (191,102) $ (191,821)

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ (373,049) $ (521,053) $ (685,157) $ (860,934) $ (1,044,009) $ (1,230,062) $ (1,414,827)
$ (373,569) $ (522,306) $ (687,759) $ (865,777) $ (1,052,311) $ (1,243,413) $ (1,435,234)

$8,000,000

$6,000,000

$4,000,000

Churn 1.25%
$2,000,000
Churn 2.5%

$-
1 4 7 0 3 6 9 2 5 8 1 4
nth nth nth th 1 th 1 th 1 th 1 th 2 th 2 th 2 th 3 th 3
o o o n n n n n n n n n
M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo
$(2,000,000)

$(4,000,000)

Cells formated like this: are input variables

0% 0% 0% 0% 0%

account for failed sales hires and attrition

Quick Marketing Calculation

50% amount of traffic that is organic
 $1.50 cost per paid visitor (Google Ad
$ 0.75 Cost per visitor (both paid and
3% visitors convert to raw leads
20% number of raw leads that turn i

1 qualified lead
5 raw leads required
167 visitors required
$125 Cost of visitors (also = Cost per
e sales person

ting, and sales management. (CAC= Cost to Acquire a Customer)

monthly gross profit per customer (ARPU x Gross Margin ) by the churn rate

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

100% 100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 6,109 $ 8,984 $ 11,823 $ 14,627 $ 17,395 $ 20,129 $ 22,829
$ (76.36) $ (112.30) $ (147.79) $ (182.83) $ (217.44) $ (251.61) $ (285.36)
$ 8,984 $ 11,823 $ 14,627 $ 17,395 $ 20,129 $ 22,829 $ 25,495
$ 19,851 $ 31,674 $ 46,301 $ 63,696 $ 83,825 $ 106,654 $ 132,149
$ 15,881 $ 25,339 $ 37,040 $ 50,957 $ 67,060 $ 85,323 $ 105,719

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 79,589 $ 99,341 $ 119,093 $ 138,845 $ 158,597 $ 178,350 $ 198,102

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ (12,565) $ (10,294) $ (8,051) $ (5,836) $ (3,649) $ (1,489) $ 644
$ (63,708) $ (74,002) $ (82,052) $ (87,888) $ (91,537) $ (93,026) $ (92,383)

MRR - Single Sales Hire MRR Versus Expen

$35,000 $30,000
$30,000 $25,000
 MRR - Single Sales Hire MRR Versus Expen
$35,000 $30,000
$30,000 $25,000
$25,000
$20,000
Churn
$20,000
MRR from prior months $15,000
$15,000 bookings
New MRR added this month Axis Title $10,000
$10,000
$5,000 $5,000

$- $-
1 2 3 4 5 6 7 8 9 10 11 12 1 3 5 7 9 1
$(5,000)nth nth nth nth nth nth nth nth nth th th th n th n th nth nth nth th
o o o o o o o o o on on on o o o o o on
M M M M M M M M M M M M M M M M M M

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

2 2 2 2 2 2 2
10 12 14 16 18 20 22
420 555 691 827 963 1,098 1,234

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 39,702 $ 63,348 $ 92,601 $ 127,392 $ 167,650 $ 213,308 $ 264,298
$ 74,663 $ 138,011 $ 230,613 $ 358,004 $ 525,654 $ 738,962 $ 1,003,260
$ 59,731 $ 110,409 $ 184,490 $ 286,403 $ 420,523 $ 591,170 $ 802,608
$ 17,968 $ 23,646 $ 29,253 $ 34,790 $ 40,258 $ 45,658 $ 50,990

$ 41,667 $ 50,000 $ 58,333 $ 66,667 $ 75,000 $ 83,333 $ 91,667

$ 39,967 $ 49,133 $ 58,300 $ 67,467 $ 76,633 $ 85,800 $ 94,967
$ 25,000 $ 30,000 $ 35,000 $ 40,000 $ 45,000 $ 50,000 $ 55,000
$ 52,544 $ 69,548 $ 86,553 $ 103,557 $ 120,561 $ 137,566 $ 154,570
$ 159,177 $ 198,681 $ 238,186 $ 277,690 $ 317,195 $ 356,699 $ 396,204
$ 432,780 $ 631,462 $ 869,647 $ 1,147,338 $ 1,464,532 $ 1,821,232 $ 2,217,435

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ (127,416) $ (148,003) $ (164,105) $ (175,777) $ (183,075) $ (186,053) $ (184,765)
$ (373,049) $ (521,053) $ (685,157) $ (860,934) $ (1,044,009) $ (1,230,062) $ (1,414,827)

Cumulative Net Profit Cumulative Net Profit

$- $7,000,000
1 3 5 7 9 11 13 15 17 19 21 23 $6,000,000
th th th th th h h h h h h h
on on on on on nt nt nt nt nt nt nt
 Cumulative Net Profit Cumulative Net Profit
$- $7,000,000
1 3 5 7 9 1 3 5 7 9 1 3 $6,000,000
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2
o o o o o n n n n n n n $5,000,000
M M M M M Mo Mo Mo Mo Mo Mo Mo
$(500,000)
$4,000,000
$(1,000,000) $3,000,000
$2,000,000
$(1,500,000) $1,000,000
$-
$(2,000,000) $(1,000,000)h 1 h 3 h 5 th 7 th 9 11 13 15 17 19 21 23
t t t h h h h h h h h
on on on on on nt nt nt nt nt nt nt nt
$(2,000,000)
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo M
$(2,500,000) $(3,000,000)

Growth in MRR
$140,000
$120,000
$100,000
$80,000
$60,000
$40,000
$20,000
$-
1 3 5 7 9 1 3 5 7 9 1 3
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2
o o o o o n n n n n n n
M M M M M Mo Mo Mo Mo Mo Mo Mo

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

100% 100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417

$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417

$ 109,438 $ 144,854 $ 180,271 $ 215,688 $ 251,104 $ 286,521 $ 321,938
$ 87,550 $ 115,883 $ 144,217 $ 172,550 $ 200,883 $ 229,217 $ 257,550
 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11
$ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581 $ 8,581
$ 7,961 $ 16,543 $ 25,124 $ 33,705 $ 42,286 $ 50,867 $ 59,448

Cumulative Net Cash Flows Cashflow compariso

$500,000 year in advance
$400,000 $40,000

$300,000 $30,000

$200,000 $20,000

Axis Title $10,000

$100,000
$-
$- 1 3 5 7 9
1 3 5 7 9 nth nth nth nth nth
th th th th th 11 13 15 17 19 21 23 $(10,000)
o o o o o n
th th th th th th th M M M M M Mo
on
$(100,000) on on on on on on on on on on on
M M M M M M M M M M M M $(20,000)

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 218,875 $ 289,708 $ 360,542 $ 431,375 $ 502,208 $ 573,042 $ 643,875
$ 481,667 $ 771,375 $ 1,131,917 $ 1,563,292 $ 2,065,500 $ 2,638,542 $ 3,282,417
$ 385,333 $ 617,100 $ 905,533 $ 1,250,633 $ 1,652,400 $ 2,110,833 $ 2,625,933
$ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833 $ 70,833

Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11

$ 155,348 $ 212,014 $ 268,681 $ 325,348 $ 382,014 $ 438,681 $ 495,348
$ 226,156 $ 418,419 $ 667,347 $ 972,943 $ 1,335,205 $ 1,754,134 $ 2,229,730

Cumulative Net Cash Flows Cashflow comparison

$40,000,000 year in advance
$35,000,000 $2,500,000
$30,000,000
$25,000,000 $2,000,000

$20,000,000 $1,500,000
$15,000,000
$1,000,000
$10,000,000 Axis Title
$5,000,000 $500,000
$-
$-
$(5,000,000)h 1 h 3 h 5 h 7 h 9 11 13 15 17 19 21 23 25 27 29 31 33 35 1 5 9 3
t t t t t h h h h h h h h h h h h h th th th h 1
on on on on on nt nt nt nt nt nt nt nt nt nt nt nt nt on on on ont ont
$(500,000)
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo M M M M M
$20,000,000 $1,500,000
$15,000,000
$1,000,000
$10,000,000 Axis Title
$5,000,000 $500,000
$-
$-
$(5,000,000)h 1 h 3 h 5 h 7 h 9 11 13 15 17 19 21 23 25 27 29 31 33 35 1 5 9 3
t t t t t h h h h h h h h h h h h h th nth nth th 1 t
on on on on on nt nt nt nt nt nt nt nt nt nt nt nt nt n
$(500,000)
o o o n n
M M M M M Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo Mo M M M Mo Mo
 Month 12 Month 13 Month 14 Month 15 Month 16 Month 17
$ (179,266) $ (169,606) $ (155,839) $ (138,015) $ (116,186) $ (90,402)
$ (188,788) $ (182,096) $ (171,837) $ (158,099) $ (140,971) $ (120,536)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ (1,594,093) $ (1,763,699) $ (1,919,538) $ (2,057,554) $ (2,173,740) $ (2,264,142)
$ (1,624,022) $ (1,806,118) $ (1,977,955) $ (2,136,054) $ (2,277,025) $ (2,397,560)

unt of traffic that is organic versus paid

 per paid visitor (Google AdWords, etc.)
per visitor (both paid and unpaid)
ors convert to raw leads
ber of raw leads that turn into qualified leads

leads required
ors required
of visitors (also = Cost per qualified lead)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 25,495 $ 28,128 $ 30,727 $ 33,295 $ 35,830 $ 38,333
$ (318.69) $ (351.60) $ (384.09) $ (416.18) $ (447.87) $ (479.17)
$ 28,128 $ 30,727 $ 33,295 $ 35,830 $ 38,333 $ 40,806
$ 160,277 $ 191,004 $ 224,299 $ 260,129 $ 298,462 $ 339,268
$ 128,221 $ 152,803 $ 179,439 $ 208,103 $ 238,770 $ 271,414

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 217,854 $ 237,606 $ 257,358 $ 277,111 $ 296,863 $ 316,615

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 2,750 $ 4,830 $ 6,884 $ 8,912 $ 10,915 $ 12,892
$ (89,633) $ (84,803) $ (77,919) $ (69,008) $ (58,093) $ (45,201)

MRR Versus Expenses Net profit - New Sales Hire

$30,000
$25,000
MRR Versus Expenses Net profit - New Sales Hire
$30,000
$25,000
$20,000
$15,000
Total MRR (Billings)
Total Expenses $10,000
$5,000
$-
$(5,000)th 1 th 3 th 5 th 7 th 9 11 13 15 17 19 21 23
on on on on on n th nth nth nth nth n th n th
3 5 7 9 $(10,000)
M M M M M o o o o o o o
th th th th 11 M M M M M M M
n n n th $(15,000)
o o o on
M M M M $(20,000)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

2 2 2 2 2 2
24 26 28 30 32 34
1,370 1,506 1,641 1,777 1,913 2,049

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 714,708 $ 785,542 $ 856,375 $ 927,208 $ 998,042 $ 1,068,875
$ 320,553 $ 382,008 $ 448,597 $ 520,257 $ 596,924 $ 678,536
$ 1,323,813 $ 1,705,821 $ 2,154,418 $ 2,674,675 $ 3,271,599 $ 3,950,135
$ 1,059,050 $ 1,364,656 $ 1,723,534 $ 2,139,740 $ 2,617,279 $ 3,160,108
$ 56,255 $ 61,455 $ 66,589 $ 71,660 $ 76,667 $ 81,611

$ 100,000 $ 108,333 $ 116,667 $ 125,000 $ 133,333 $ 141,667

$ 104,133 $ 113,300 $ 122,467 $ 131,633 $ 140,800 $ 149,967
$ 60,000 $ 65,000 $ 70,000 $ 75,000 $ 80,000 $ 85,000
$ 171,575 $ 188,579 $ 205,584 $ 222,588 $ 239,592 $ 256,597
$ 435,708 $ 475,212 $ 514,717 $ 554,221 $ 593,726 $ 633,230
$ 2,653,143 $ 3,128,356 $ 3,643,072 $ 4,197,294 $ 4,791,019 $ 5,424,250

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ (179,266) $ (169,606) $ (155,839) $ (138,015) $ (116,186) $ (90,402)
$ (1,594,093) $ (1,763,699) $ (1,919,538) $ (2,057,554) $ (2,173,740) $ (2,264,142)

lative Net Profit

lative Net Profit

1 3 15 1 7 1 9 2 1 2 3 2 5 27 2 9 31 3 3 35
th nth nth nth nth nth nth nth nth nth nth nth
o o o o o o o o o o o
M M M M M M M M M M M

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 3,542 $ 11,688 $ 23,375 $ 35,417 $ 35,417 $ 35,417
$ (531.25) $ (1,753.13) $ (3,506.25) $ (5,312.50) $ (5,312.50) $ (5,312.50)
$ 3,010 $ 9,934 $ 19,869 $ 30,104 $ 30,104 $ 30,104
$ 38,427 $ 45,351 $ 55,285 $ 65,521 $ 65,521 $ 65,521
$ 360,365 $ 405,716 $ 461,001 $ 526,522 $ 592,043 $ 657,564
$ 288,292 $ 324,573 $ 368,801 $ 421,218 $ 473,634 $ 526,051
 Month 12 Month 13 Month 14 Month 15 Month 16 Month 17
$ 10,989 $ 16,529 $ 24,476 $ 32,664 $ 32,664 $ 32,664
$ 70,438 $ 86,966 $ 111,442 $ 144,107 $ 176,771 $ 209,436

hflow comparison - monthly payments vs Cumulative Cashflow comparision

r in advance payments vs year in advance
$40,000 $500,000

$30,000 $400,000
Net profit $300,000 Cum
$20,000 Net Cash Flows Cum
$200,000
e $10,000 Axis Title
$100,000
$-
1 3 5 7 9 1 3 5 7 9 1 3 $-
nth nth nth nth nth th 1 th 1 th 1 th 1 th 1 th 2 th 2 1 4 7 0 3 6 9 2
$(10,000)
o o o o o n n n n n n n th nth nth th 1 th 1 th 1 th 1 th 2
M M M M M Mo Mo Mo Mo Mo Mo Mo $(100,000)
n
o o o n n n n n
M M M Mo Mo Mo Mo Mo
$(20,000) $(200,000)

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 714,708 $ 785,542 $ 856,375 $ 927,208 $ 998,042 $ 1,068,875
$ 714,708 $ 786,604 $ 860,944 $ 938,790 $ 1,020,248 $ 1,101,706
$ 3,997,125 $ 4,783,729 $ 5,644,673 $ 6,583,463 $ 7,603,710 $ 8,705,417
$ 3,197,700 $ 3,826,983 $ 4,515,738 $ 5,266,770 $ 6,082,968 $ 6,964,333
$ 70,833 $ 71,896 $ 74,340 $ 77,846 $ 81,458 $ 81,458

Month 12 Month 13 Month 14 Month 15 Month 16 Month 17

$ 552,014 $ 609,531 $ 669,003 $ 731,279 $ 796,446 $ 861,613
$ 2,761,992 $ 3,351,771 $ 4,001,021 $ 4,712,549 $ 5,489,243 $ 6,331,103

flow comparison - monthly payments vs Cumulative Cashflow comparisio

in advance payments vs year in advance
$2,500,000 $40,000,000
$2,000,000 $35,000,000
$30,000,000
$1,500,000 Net profit $25,000,000
Net Cash Flows
$20,000,000
$1,000,000
$15,000,000
Axis Title
$500,000 $10,000,000
$5,000,000
$- $-
1 5 9 3 7 1 5 9 3
th th th h 1 h 1 h 2 h 2 h 2 h 3 $(5,000,000) 1 6 1 6 1 6 1 6
th th h 1 h 1 h 2 h 2 h 3 h 3
on on on ont ont ont ont ont ont
$(500,000)
on on ont ont ont ont ont ont
M M M M M M M M M M M
$1,500,000 Net profit $25,000,000
Net Cash Flows
$20,000,000
$1,000,000
$15,000,000
Axis Title
$500,000 $10,000,000
$5,000,000
$- $-
1 5 9 3 7 1 5 9 3
n th nth nth th 1 th 1 th 2 th 2 th 2 th 3 $(5,000,000) 1 6 1 6 1 6 1 6
th th h 1 h 1 h 2 h 2 h 3 h 3
$(500,000)
o o o n n n n n n
M M M Mo Mo Mo Mo Mo Mo on on ont ont ont ont ont ont
M M M M M M M M
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
$ (60,711) $ (27,163) $ 10,194 $ 51,313 $ 96,146 $ 144,647
$ (96,877) $ (70,075) $ (40,208) $ (7,354) $ 28,414 $ 67,022

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ (2,324,853) $ (2,352,015) $ (2,341,821) $ (2,290,508) $ (2,194,362) $ (2,049,716)
$ (2,494,437) $ (2,564,512) $ (2,604,720) $ (2,612,074) $ (2,583,661) $ (2,516,639)
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 40,806 $ 43,247 $ 45,658 $ 48,038 $ 50,389 $ 52,711
$ (510.07) $ (540.59) $ (570.72) $ (600.48) $ (629.87) $ (658.89)
$ 43,247 $ 45,658 $ 48,038 $ 50,389 $ 52,711 $ 55,003
$ 382,515 $ 428,173 $ 476,211 $ 526,600 $ 579,311 $ 634,315
$ 306,012 $ 342,538 $ 380,969 $ 421,280 $ 463,449 $ 507,452

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 336,367 $ 356,119 $ 375,872 $ 395,624 $ 415,376 $ 435,128

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 14,845 $ 16,774 $ 18,679 $ 20,559 $ 22,417 $ 24,251
$ (30,355) $ (13,581) $ 5,097 $ 25,656 $ 48,073 $ 72,323

ew Sales Hire Cumulative Net Profit - New Sales Hire

$600,000

$500,000
ew Sales Hire Cumulative Net Profit - New Sales Hire
$600,000

$500,000

$400,000
$300,000

$200,000

$100,000
11 13 15 17 19 21 23
th th th th th th $-
on on on on on on 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5
M M M M M M
$(100,000)th th th th th h 1 h 1 h 1 h 1 h 1 h 2 h 2 h 2 h 2 h 2 h 3 h 3 h 3
on on on on on ont ont ont ont ont ont ont ont ont ont ont ont ont
M M M M M M M M M M M M M M M M M M
$(200,000)

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

2 2 2 2 2 2
36 38 40 42 44 46
2,184 2,320 2,456 2,592 2,727 2,863

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 1,139,708 $ 1,210,542 $ 1,281,375 $ 1,352,208 $ 1,423,042 $ 1,493,875
$ 765,030 $ 856,345 $ 952,422 $ 1,053,201 $ 1,158,623 $ 1,268,629
$ 4,715,164 $ 5,571,510 $ 6,523,932 $ 7,577,133 $ 8,735,755 $ 10,004,385
$ 3,772,132 $ 4,457,208 $ 5,219,145 $ 6,061,706 $ 6,988,604 $ 8,003,508
$ 86,494 $ 91,316 $ 96,077 $ 100,779 $ 105,422 $ 110,007

$ 150,000 $ 158,333 $ 166,667 $ 175,000 $ 183,333 $ 191,667

$ 159,133 $ 168,300 $ 177,467 $ 186,633 $ 195,800 $ 204,967
$ 90,000 $ 95,000 $ 100,000 $ 105,000 $ 110,000 $ 115,000
$ 273,601 $ 290,606 $ 307,610 $ 324,615 $ 341,619 $ 358,623
$ 672,735 $ 712,239 $ 751,743 $ 791,248 $ 830,752 $ 870,257
$ 6,096,984 $ 6,809,223 $ 7,560,967 $ 8,352,214 $ 9,182,967 $ 10,053,223

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ (60,711) $ (27,163) $ 10,194 $ 51,313 $ 96,146 $ 144,647
$ (2,324,853) $ (2,352,015) $ (2,341,821) $ (2,290,508) $ (2,194,362) $ (2,049,716)
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ (5,312.50) $ (5,312.50) $ (5,312.50) $ (5,312.50) $ (5,312.50) $ (5,312.50)
$ 30,104 $ 30,104 $ 30,104 $ 30,104 $ 30,104 $ 30,104
$ 65,521 $ 65,521 $ 65,521 $ 65,521 $ 65,521 $ 65,521
$ 723,084 $ 788,605 $ 854,126 $ 919,647 $ 985,168 $ 1,050,689
$ 578,468 $ 630,884 $ 683,301 $ 735,718 $ 788,134 $ 840,551
 Month 18 Month 19 Month 20 Month 21 Month 22 Month 23
$ 32,664 $ 32,664 $ 32,664 $ 32,664 $ 32,664 $ 32,664
$ 242,100 $ 274,765 $ 307,429 $ 340,094 $ 372,758 $ 405,422

e Cashflow comparision - monthly

vs year in advance
0

0 Cumulative Net Profit

Cumulative Net Cash Flows
0

1 4 7 0 3 6 9 2
h th th h 1 h 1 h 1 h 1 h 2
) on on nt nt nt nt nt
M M Mo Mo Mo Mo Mo
)

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 1,139,708 $ 1,210,542 $ 1,281,375 $ 1,352,208 $ 1,423,042 $ 1,493,875
$ 1,183,165 $ 1,264,623 $ 1,346,081 $ 1,427,540 $ 1,508,998 $ 1,590,456
$ 9,888,581 $ 11,153,204 $ 12,499,285 $ 13,926,825 $ 15,435,823 $ 17,026,279
$ 7,910,865 $ 8,922,563 $ 9,999,428 $ 11,141,460 $ 12,348,658 $ 13,621,023
$ 81,458 $ 81,458 $ 81,458 $ 81,458 $ 81,458 $ 81,458

Month 18 Month 19 Month 20 Month 21 Month 22 Month 23

$ 926,779 $ 991,946 $ 1,057,113 $ 1,122,279 $ 1,187,446 $ 1,252,613
$ 7,238,130 $ 8,210,324 $ 9,247,685 $ 10,350,212 $ 11,517,906 $ 12,750,767

tive Cashflow comparision - monthly

ts vs year in advance
00,000
00,000
00,000
00,000 Cumulative Net Profit
00,000 Cumulative Net Cash Flows
00,000
00,000
00,000
$-
1 6 1 6 1 6 1 6
00,000)th th h 1 h 1 h 2 h 2 h 3 h 3
on on ont ont ont ont ont ont
M M
00,000 Cumulative Net Profit
00,000 Cumulative Net Cash Flows
00,000
00,000
00,000
$-
1 6 1 6 1 6 1 6
00,000)th th h 1 h 1 h 2 h 2 h 3 h 3
on on ont ont ont ont ont ont
M M M M M M M M
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
$ 196,770 $ 252,470 $ 311,702 $ 374,423 $ 440,587 $ 510,153
$ 108,399 $ 152,477 $ 199,187 $ 248,464 $ 300,244 $ 354,464

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ (1,852,946) $ (1,600,476) $ (1,288,773) $ (914,351) $ (473,764) $ 36,390
$ (2,408,240) $ (2,255,763) $ (2,056,575) $ (1,808,111) $ (1,507,867) $ (1,153,402)
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 55,003 $ 57,267 $ 59,503 $ 61,710 $ 63,890 $ 66,043
$ (687.54) $ (715.84) $ (743.78) $ (771.38) $ (798.63) $ (825.54)
$ 57,267 $ 59,503 $ 61,710 $ 63,890 $ 66,043 $ 68,169
$ 691,582 $ 751,085 $ 812,795 $ 876,686 $ 942,729 $ 1,010,898
$ 553,266 $ 600,868 $ 650,236 $ 701,348 $ 754,183 $ 808,718

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 454,881 $ 474,633 $ 494,385 $ 514,137 $ 533,889 $ 553,642

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 26,062 $ 27,850 $ 29,616 $ 31,360 $ 33,082 $ 34,783
$ 98,385 $ 126,235 $ 155,851 $ 187,211 $ 220,294 $ 255,077

es Hire
es Hire

7 2 9 31 3 3 35
th th th th
on on on on
M M M

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

2 2 2 2 2 2
48 50 52 54 56 58
2,999 3,135 3,271 3,406 3,542 3,678

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 1,564,708 $ 1,635,542 $ 1,706,375 $ 1,777,208 $ 1,848,042 $ 1,918,875
$ 1,383,164 $ 1,502,170 $ 1,625,590 $ 1,753,371 $ 1,885,457 $ 2,021,796
$ 11,387,549 $ 12,889,718 $ 14,515,309 $ 16,268,680 $ 18,154,137 $ 20,175,933
$ 9,110,039 $ 10,311,775 $ 11,612,247 $ 13,014,944 $ 14,523,310 $ 16,140,746
$ 114,534 $ 119,006 $ 123,421 $ 127,781 $ 132,086 $ 136,338

$ 200,000 $ 208,333 $ 216,667 $ 225,000 $ 233,333 $ 241,667

$ 214,133 $ 223,300 $ 232,467 $ 241,633 $ 250,800 $ 259,967
$ 120,000 $ 125,000 $ 130,000 $ 135,000 $ 140,000 $ 145,000
$ 375,628 $ 392,632 $ 409,637 $ 426,641 $ 443,646 $ 460,650
$ 909,761 $ 949,266 $ 988,770 $ 1,028,274 $ 1,067,779 $ 1,107,283
$ 10,962,984 $ 11,912,250 $ 12,901,020 $ 13,929,294 $ 14,997,073 $ 16,104,357

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 196,770 $ 252,470 $ 311,702 $ 374,423 $ 440,587 $ 510,153
$ (1,852,946) $ (1,600,476) $ (1,288,773) $ (914,351) $ (473,764) $ 36,390
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 35,417 $ 38,427 $ 45,351 $ 55,285 $ 65,521 $ 65,521
$ (5,312.50) $ (5,764.06) $ (6,802.66) $ (8,292.81) $ (9,828.13) $ (9,828.13)
$ 30,104 $ 32,663 $ 38,548 $ 46,993 $ 55,693 $ 55,693
$ 65,521 $ 68,080 $ 73,965 $ 82,409 $ 91,109 $ 91,109
$ 1,116,209 $ 1,184,289 $ 1,258,254 $ 1,340,663 $ 1,431,773 $ 1,522,882
$ 892,968 $ 947,431 $ 1,006,603 $ 1,072,531 $ 1,145,418 $ 1,218,306
 Month 24 Month 25 Month 26 Month 27 Month 28 Month 29
$ 32,664 $ 34,712 $ 39,420 $ 46,175 $ 53,135 $ 53,135
$ 438,087 $ 472,798 $ 512,218 $ 558,394 $ 611,529 $ 664,664

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 1,564,708 $ 1,635,542 $ 1,706,375 $ 1,777,208 $ 1,848,042 $ 1,918,875
$ 1,671,915 $ 1,753,532 $ 1,835,517 $ 1,918,027 $ 2,001,079 $ 2,084,131
$ 18,698,194 $ 20,451,726 $ 22,287,243 $ 24,205,269 $ 26,206,348 $ 28,290,479
$ 14,958,555 $ 16,361,381 $ 17,829,794 $ 19,364,216 $ 20,965,079 $ 22,632,383
$ 81,458 $ 81,618 $ 81,984 $ 82,510 $ 83,052 $ 83,052

Month 24 Month 25 Month 26 Month 27 Month 28 Month 29

$ 1,317,779 $ 1,383,074 $ 1,448,661 $ 1,514,669 $ 1,581,111 $ 1,647,553
$ 14,048,794 $ 15,412,115 $ 16,841,024 $ 18,335,941 $ 19,897,300 $ 21,525,100
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
$ 583,078 $ 659,320 $ 738,837 $ 821,588 $ 907,534 $ 996,634
$ 411,063 $ 469,982 $ 531,163 $ 594,548 $ 660,084 $ 727,715

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 619,468 $ 1,278,787 $ 2,017,624 $ 2,839,212 $ 3,746,746 $ 4,743,380
$ (742,339) $ (272,357) $ 258,806 $ 853,354 $ 1,513,438 $ 2,241,153
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951 $ 2,951
$ 68,169 $ 70,268 $ 72,341 $ 74,388 $ 76,410 $ 78,406
$ (852.11) $ (878.35) $ (904.27) $ (929.86) $ (955.12) $ (980.08)
$ 70,268 $ 72,341 $ 74,388 $ 76,410 $ 78,406 $ 80,378
$ 1,081,166 $ 1,153,507 $ 1,227,896 $ 1,304,306 $ 1,382,712 $ 1,463,090
$ 864,933 $ 922,806 $ 982,317 $ 1,043,445 $ 1,106,170 $ 1,170,472

$ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167 $ 4,167

$ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583 $ 4,583
$ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500 $ 2,500
$ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502 $ 8,502
$ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752 $ 19,752
$ 573,394 $ 593,146 $ 612,898 $ 632,650 $ 652,403 $ 672,155

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 36,462 $ 38,121 $ 39,759 $ 41,376 $ 42,973 $ 44,550
$ 291,539 $ 329,660 $ 369,418 $ 410,794 $ 453,767 $ 498,317
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
2 2 2 2 2 2
60 62 64 66 68 70
3,814 3,949 4,085 4,221 4,357 4,492

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 1,989,708 $ 2,060,542 $ 2,131,375 $ 2,202,208 $ 2,273,042 $ 2,343,875
$ 2,162,332 $ 2,307,015 $ 2,455,792 $ 2,608,612 $ 2,765,424 $ 2,926,179
$ 22,338,265 $ 24,645,279 $ 27,101,071 $ 29,709,683 $ 32,475,107 $ 35,401,286
$ 17,870,612 $ 19,716,224 $ 21,680,857 $ 23,767,746 $ 25,980,085 $ 28,321,029
$ 140,537 $ 144,683 $ 148,777 $ 152,820 $ 156,812 $ 160,755

$ 250,000 $ 258,333 $ 266,667 $ 275,000 $ 283,333 $ 291,667

$ 269,133 $ 278,300 $ 287,467 $ 296,633 $ 305,800 $ 314,967
$ 150,000 $ 155,000 $ 160,000 $ 165,000 $ 170,000 $ 175,000
$ 477,654 $ 494,659 $ 511,663 $ 528,668 $ 545,672 $ 562,676
$ 1,146,788 $ 1,186,292 $ 1,225,797 $ 1,265,301 $ 1,304,805 $ 1,344,310
$ 17,251,144 $ 18,437,436 $ 19,663,233 $ 20,928,534 $ 22,233,339 $ 23,577,649

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 583,078 $ 659,320 $ 738,837 $ 821,588 $ 907,534 $ 996,634
$ 619,468 $ 1,278,787 $ 2,017,624 $ 2,839,212 $ 3,746,746 $ 4,743,380
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
100% 100% 100% 100% 100% 100%
$ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417 $ 35,417
$ 65,521 $ 65,521 $ 65,521 $ 65,521 $ 65,521 $ 65,521
$ (9,828.13) $ (9,828.13) $ (9,828.13) $ (9,828.13) $ (9,828.13) $ (9,828.13)
$ 55,693 $ 55,693 $ 55,693 $ 55,693 $ 55,693 $ 55,693
$ 91,109 $ 91,109 $ 91,109 $ 91,109 $ 91,109 $ 91,109
$ 1,613,992 $ 1,705,101 $ 1,796,210 $ 1,887,320 $ 1,978,429 $ 2,069,538
$ 1,291,193 $ 1,364,081 $ 1,436,968 $ 1,509,856 $ 1,582,743 $ 1,655,631
 Month 30 Month 31 Month 32 Month 33 Month 34 Month 35
$ 53,135 $ 53,135 $ 53,135 $ 53,135 $ 53,135 $ 53,135
$ 717,799 $ 770,935 $ 824,070 $ 877,205 $ 930,341 $ 983,476

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 1,989,708 $ 2,060,542 $ 2,131,375 $ 2,202,208 $ 2,273,042 $ 2,343,875
$ 2,167,183 $ 2,250,235 $ 2,333,287 $ 2,416,339 $ 2,499,391 $ 2,582,443
$ 30,457,662 $ 32,707,897 $ 35,041,184 $ 37,457,524 $ 39,956,915 $ 42,539,359
$ 24,366,130 $ 26,166,318 $ 28,032,948 $ 29,966,019 $ 31,965,532 $ 34,031,487
$ 83,052 $ 83,052 $ 83,052 $ 83,052 $ 83,052 $ 83,052

Month 30 Month 31 Month 32 Month 33 Month 34 Month 35

$ 1,713,994 $ 1,780,436 $ 1,846,878 $ 1,913,319 $ 1,979,761 $ 2,046,203
$ 23,219,342 $ 24,980,026 $ 26,807,151 $ 28,700,718 $ 30,660,727 $ 32,687,177
 Month 36
$ 1,088,848
$ 797,391

Month 36
$ 5,832,228
$ 3,038,543
 Month 36
100%
$ 35,417
$ 2,951
$ 80,378
$ (1,004.72)
$ 82,324
$ 1,545,414
$ 1,236,331

$ 4,167
$ 4,583
$ 2,500
$ 8,502
$ 19,752
$ 691,907

Month 36
$ 46,107
$ 544,424
 Month 36
2
72
4,628

Month 36
$ 2,414,708
$ 3,090,828
$ 38,492,114
$ 30,793,691
$ 164,648

$ 300,000
$ 324,133
$ 180,000
$ 579,681
$ 1,383,814
$ 24,961,463

Month 36
$ 1,088,848
$ 5,832,228
 Month 36
100%
$ 35,417
$ 65,521
$ (9,828.13)
$ 55,693
$ 91,109
$ 2,160,648
$ 1,728,518
 Month 36
$ 53,135
$ 1,036,611

Month 36
$ 2,414,708
$ 2,665,496
$ 45,204,854
$ 36,163,883
$ 83,052

Month 36
$ 2,112,644
$ 34,780,069