- Richard Anderson III
What Is A Pro Forma?
What the hell is a proforma and why do I need to know about it?
Three key things. Who are you going to be hiring? How much money do you need? And how much do you need to push on your sale team? And when you get down to those three key assumptions, that really help you understand your growth strategy, then that pro forma is worth its weight in gold.
There's two parts to it you need it for your internal validation. You can put in real numbers, it'll change as you go, and a pro forma becomes you tracking your business regularly and seeing what is my next three months look like, what does my next year look like?
The second side of it being you go to an investor and you're starting to look for funding. If you're going to a bank anywhere, they're gonna look at your pro forma and it will tell them all that they need to know about your assumptions. The more in depth, the more valuable, the more complete your pro forma when you're going to these kinds of places. Uh, the more likely you are to acquire the funding and to impress the investor when they're taking a look at it.