Launching a new project or taking a business to the next level is always a challenge for an entrepreneur. Not only the success of the launch, but also the long-term stability of the company depends on competent financial planning.

How to effectively allocate resources at the startup stage? What costs should be taken into account to avoid financial difficulties in the future? How to create a financial model that will become a roadmap for your business?

These and many other questions will be answered by EMMER's case study, which demonstrates the importance of creating a financial model that becomes the basis for successful market entry.
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Meet EMMER, a sliding kitchen for Jeep Wrangler JL

For the modern explorer, the journey is as important as the destination.

EMMER is an innovative retractable kitchen designed for owners of Jeep Wrangler JL adventure vehicles. The design combines advanced technology with striking aesthetics, while enhancing the enjoyment of impeccable outdoor cooking.

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Challenges and financial calculations: How to successfully launch a business project in the US market
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EMMER is a business project that will be launched from scratch in the US market. This is a new experience for the owner, but he has a golden rule:

First, you have to win the calculations.

Before launching any project, an entrepreneur should carefully evaluate all costs and potential revenues. Even if the project seems very attractive, it is important to determine whether it makes sense from a financial point of view. The key is to understand the conditions under which the business will be profitable, or at least not cause losses.

The task was to clearly define the conditions for the success of the business project, taking into account the required sales volume and the price of the product. To do this, several key parameters had to be taken into account, including launching the project on the Kickstarter platform. This platform allows you to raise pre-funding from potential buyers, spend time making the product, and send it to users. However, the implementation process has many nuances that need to be taken into account to achieve success.

Project features: Why the financial model is key to success on Kickstarter
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Launching a company on Kickstarter requires not only a presence on the platform, but also careful preparation. One of the key stages is the pre-launch campaign, which lays the foundation for future success. Preparatory activities include collecting a database of potential customer email addresses and creating an active community around the product. All these actions require significant investments.

The main costs are worth highlighting:

• Organizing a PR campaign
• Presentation of the product through influencers, which requires the production of the product, its shipment to the United States, and payment for the services of influencers
• Hiring an agency to professionally launch a Kickstarter campaign
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In addition, you need to consider the following costs:

• Kickstarter commission
• Acquiring fees
• Taxes in the country of production
• Customs clearance costs in the United States
• Payment for the work of the team that will implement the project
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Success on Kickstarter is determined by how carefully these costs are planned. Only a well-calculated financial model will allow you to not only cover all expenses but also ensure the profitability of the campaign. It's not just about preparing a budget, it's about strategic planning that lays the foundation for scaling your business.
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EMMER needed effective solutions to overcome a number of challenges and to grow successfully:

• Project development: The need to improve the current project to take it to the next level required the development of new approaches and strategies to ensure competitiveness and sustainable growth‍
• International expansion: Expansion into international markets required adaptation to different market conditions
• Financial planning: The need to create a financial model that will allow to estimate the profitability of the business, determine the required volume of sales and services. The financial model should help to understand what factors affect profitability and how to optimize them to achieve financial goals

Financial planning and analysis with Finmap: how to optimize costs and maximize profits
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The most effective way to analyze all expenses and profits is to build a financial model with the help of Finmap specialists, as there are many parameters to consider.

The owner of EMMER knew that Finmap was not just a program for accounting for money, but also a team of professional financiers offering expert services for creating and developing projects.

It was also known that Finmap helps both new startups and existing businesses reach a new level.

What is a financial model and what role does it play in the decision-making process?
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A financial model is a tool used to forecast the financial performance of a business. It is a mathematical representation of the financial aspects of a company, including revenues, expenses, profits, cash flows, investments, and other financial indicators. The model allows you to analyze the current financial situation and forecast future results based on various scenarios, such as changes in costs, pricing, market environment, etc.

Financial models are widely used for business planning, investment project evaluation, management decision-making, and strategic planning. They can be developed for companies of any size and in any industry, and can be used to assess risks and opportunities.

Creating a financial model: how Finmap helps EMMER make winning decisions
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The process of creating a financial model begins with an in-depth analysis of your business. Finmap experts collect detailed information about the project, which allows us to accurately calculate financial flows and forecast future income.

What Finmap specialists take into account:

Vitrate structure:

1. Product costs (cost price and logistics)
2. Operating expenses (salaries, development costs, prototypes)
3. Payment system fees, legal and unforeseen expenses

Marketing and sales:

1. The cost of a marketing manager's salary
2. Marketing budget (typically 30% of the planned Kickstarter collection)
3. Content and PR costs

These costs form the basis for calculating EBITDA, taxes, and the final net profit. The financial model also takes into account different pricing strategies. For example, Kickstarter often offers significant discounts to attract early adopters, while it is important to maintain margins for subsequent sales through dealers.

The main purpose of the financial model is to help determine and achieve the optimal amount to collect. It's important to set a realistic goal that can be exceeded rather than risking too much. For example, Kickstarter campaigns usually last two months and raise between $100 thousand and $150 thousand, but it is better to set a goal, for example, $80 thousand, which can be exceeded.

The financial model also allows entrepreneurs to experiment with different combinations of prices and sales volumes, such as retail price, dealer price, early bird price. This helps to understand how changes in strategy affect the overall business picture and how much money can be raised on the platform.

It's important to take into account all expenses, including pre-launch campaign costs, to assess the realism of the goals. For example, if you raised $130k but spent $108k on it, will you be able to sell enough products in a month to be in the black?

A financial model is a forecasting tool. It helps to plan sales for the whole year so that the company remains profitable. Working with the model, you can assess the impact of various scenarios, such as selling only through dealers or only at retail, and understand how this will affect the business.

You also need to take into account the tax jurisdiction: in Ukraine, the tax can be 5%, and in Europe, it can be up to 40%. The financial model shows under what conditions the business will be profitable or risk becoming unprofitable.

A financial model allows an entrepreneur to clearly understand what expenses and income to expect and how different strategies will affect the financial result. It helps to optimize costs, find variables that can be adjusted, and make informed decisions that will ensure business profitability.

Results of cooperation: Financial models for optimization and global growth

Finmap's financial modeling service has been a key factor in EMMER's success.

What has EMMER gained from working with Finmap?

1. A structured financial model: Professional financiers have developed a customized model for the company, which provided a clear understanding of the possibilities for increasing profits. All data is displayed in clear tables that take into account many parameters, which allows for effective management decisions. This has helped optimize finances and increase the efficiency of management processes, which will allow the company to successfully develop and launch new projects.
2. Optimization of financial flows: Automated cash flow tracking will reduce costs and increase profitability. In addition, detailed data analysis will allow for better cash flow forecasting and budgeting, which has significantly increased financial stability.
3. International Expansion: With Finmap's support, the brand will not only be able to successfully expand its operations to new international markets, but also ensure transparency and efficiency of financial processes at all stages of projects. Finmap's support includes detailed cost and revenue analysis, development of financial models that meet the requirements of new markets, and assistance in optimizing financial strategies. This includes budget planning, cash flow management, investment planning, and strategic financial management to achieve sustainable growth and profitability on a global scale.

Whether you're planning to launch new projects or looking to improve the financial performance of your existing business, creating a financial model is a critical step.

Use Finmap to successfully implement and realize your projects.