What funders will test in your financial model

Connect the model to how the business works

Explain revenue through operating drivers: customers, orders, units, utilisation, prices, retention, or another measure suited to the business. Link the costs needed to deliver that activity. Avoid growth percentages that have no connection to capacity, customers, or evidence.

For an impact business, explain how the planned activity connects to intended outcomes and what supporting evidence exists. Keep impact assumptions visible rather than presenting the forecast as a guaranteed result.

Show the cash required to deliver the plan

Include payment timing, inventory, investment, debt service, and other relevant cash commitments. Show when funding is required and which milestones it is intended to support. Keep expected financing separate from existing cash.

Where revenue and costs use different currencies, make the exchange-rate assumptions explicit. If a grant reimburses eligible spending after it happens, the business may need to fund the period before reimbursement.

Test the assumptions that could change the decision

Choose a small number of meaningful sensitivities. These might include slower collections, lower sales volume, an input-cost increase, a delayed launch, or a different exchange rate. Show how the change affects cash and the amount or timing of funding.

Make it easy to review

• Separate historical results from forecasts.
• Label inputs, units, currencies, sources, and dates.
• Reconcile opening balances to the records.
• Use consistent assumptions across the model, pitch, and use-of-funds schedule.
• Make the base and downside cases understandable.
• Keep a dated version and a record of material changes.

Ask the intended funder about its requirements. Forecast periods, reporting formats, and supporting schedules vary by mandate and transaction.