This part requires you to use your imagination, be creative
Pretend I am a wealthy businessman with lots of current cash on hand (earning me no return, not a good thing) and you are
starting a firm or have a current firm and are pitching a new project to have me invest.
Step 1: Tell me about your firm/project BRIEFLY
Step 2: Tell me/show me about you projections of your past/present/future sales, costs, ratios, income, OCFs, etc.
Step 3: Value your company/project to ask me for the money to undertake the project (i.e. think of appropriate discount rates due to risk, growth rates, etc.)
TIPS:
NPV analysis is the overarching goal of the project, without it, you will fail the project
-so, you probably will need OCF, CAPEX and NWC, right?
-How did you get to those numbers? (can be sort of made up, but reasonable)
-depending on your setting will determine what ‘financials’ you present
-I think 1 page max, single space writing is sufficient
-you may have a few tables and charts so I will not limit those…BUT more is not always better.
-A useful chart/graph is priceless. A non-useful one is detrimental.
-How did you get to the risk? i.e. discount rate.
Question 2, how to get the money
ALWAYS remember…pretend I was your boss and asked for this project as a part of your job, what
would you turn in?