Question
SCENARIO: (You invented Dura-Clear windows that never need washing! Nothing sticks to them - not pollution, pollen, dirt, dust, bird droppings, fingerprints, nothing. You've invested
SCENARIO:
(You invented "Dura-Clear windows" that never need washing! Nothing sticks to them - not pollution, pollen, dirt, dust, bird droppings, fingerprints, nothing. You've invested all your own savings, your parents* savings, and some of your friends" savings as well into the R&D, production, and start-up of your business.
It's been three years since you started selling your windows primarily to single-family homeowners, but now apartment building contractors across the nation have been requesting your windows.
Unfortunately, you're already operating at full capacity. It's time to make the switch from single-family homes to commercial buildings, but to do so requires a large infusion of funding for expansion.
You need more of everything: space, equipment, employees, etc.
Ever the optimist, you applied to the TV show Shark Tank--where entrepreneurs compete for funding from angel investors ("sharks")--to see if a shark will invest in your company and serve as a mentor as well. To your surprise, you were accepted to the show! You've already prepared most of your marketing and sales pitches, and now it's time to put together your forecasted financial statements. You intend to show the sharks that backing your business would be a very profitable investment. You also need to determine how much funding to ask for in exchange for how much ownership you'll give up.
It's STILL January 1, 2023, and you'll be going on Shark Tank in 2 weeks. You are unhappy with your previous Sales Forecast (Milestone 1) because using your current level of sales to residences was not a good predictor of your upcoming sales to commercial builders. You believe vour sales will increase significantly and that each order will result in a higher profit. You decide to change your forecasting method to a combination of Ratios, Percent-of-Sales, and Pro Forma forecasting.
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