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Successfully launching a business involves careful financial planning, which includes estimating startup costs and projecting potential earnings. A thorough financial plan is crucial as it outlines the required investment to get your business off the ground, as well as the sources for these funds. Moreover, it provides projections for revenue and profit, giving you an insight into when your business might start turning a profit. These financial details are not only instrumental for your internal planning but also play a vital role in securing funding from investors and lenders, thereby making them a key component of your business plan. In this lesson, you will be focusing on estimating the startup costs and identifying potential sources of capital for your business. This task will be accomplished using a spreadsheet where you will also project your profit and loss for the first year. Such financial planning is essential, especially if you’re considering approaching a bank for a business loan. During this process, you will learn to edit and format spreadsheets in Google Sheets, input financial data, and use functions to calculate various financial metrics like costs, capital, revenue, and profit. While this lesson specifically uses Google Sheets, the skills and concepts you acquire can be applied to any spreadsheet application.
SCORE.org, a resource partner of the U.S. Small Business Administration, provides helpful spreadsheet templates and worksheets to guide you through this process. If you’re unsure about certain figures during this exercise, it’s fine to work with estimates and refine them later. Additionally, if you have already drafted a business plan document, you can incorporate this newly estimated financial information into it, further enhancing the plan’s completeness and accuracy. To begin, ensure you are signed in to your Google account. Open a new browser tab, navigate to Google.com, and sign in if you haven’t already. Start by accessing the “startup expenses and capital” worksheet provided with this lesson. Make a copy of this worksheet, rename it for your personal use, and then proceed to the next video where you will start working on estimating your startup expenses. Now, it’s your opportunity to delve into the worksheet and embark on this crucial step of financial planning for your business venture.