Three key takeaways on how to build a financial model
- Knowing how to build a financial model starts with one thing: the quality of your assumptions. Get them wrong and every number that follows is wrong too.
- The model works for two things: projecting your future numbers and tracking your actual ones month by month. Comparing both is where the real insights come from.
- If everything shows red when you first open the model, keep going. For early-stage ventures, red is normal.
This article is based on a live masterclass we hosted inside the Ecopreneur Community with Belen Pistek, a finance specialist at Blinkist who is building a side project focused on helping sustainable businesses get financially fit.
This is the second part of a two-part masterclass. Part one covered the financial basics every nature founder needs to know: EBITDA, burn rate, cash versus profit, and unit economics. This session is where you open the template and fill it in with your actual numbers.
Every Tuesday we bring in biodiversity heroes, nature founders, and field experts to share what they are building, the lessons they have learned, and real insights for starting or scaling a nature venture.
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From basics to numbers: what this session covers
Belen came back for part two with a financial dashboard she built specifically for nature ventures. A Google Sheets dashboard where you fill in the blue cells and the model does the rest.
The session walked through how to build a financial model tab by tab: what to fill in, what it tells you, and how to read what comes out.
If you have not gone through part one yet, start there. The concepts behind the numbers make the template much easier to use.
How to build a financial model step by step
Belen already built the structure. The hardest part is done. You just have to download the financial dashboard below and follow along as this article walks you through each tab.
Only the blue cells need your input. Everything else calculates itself automatically based on what you fill in.
One model, two uses
Most founders think of a financial model as something built once to show investors. It can do much more than that.
Belen designed this template with two uses in mind.
📈 The first is forecasting: projecting what you expect your numbers to look like in the months and years ahead. Investors sometimes ask for projections covering one, two, or five years. The model handles this.
📊 The second use is tracking: recording your actual numbers month by month and comparing them to what you projected. If you budgeted €50,000 in employee costs and the actual figure came in at €60,000, the model shows you the gap immediately.
Running both in parallel is where the model earns its place. You stop being surprised by your own business.
Tab by tab: what to fill in
Each tab feeds into the next. Skip one and the numbers downstream stop making sense, like a food chain with a species missing. 🦈
1. Your monthly costs
Start here. Salaries, rent, software, direct production costs, everything the project needs to stay alive.
Belen reminded the group during the masterclass that “If you are a solopreneur, you should add your salary in here. Don’t forget that.”
Your time has a cost. Assign it a salary. Leave it out and the model undercounts your real costs. The moment you hire someone to replace you, the whole picture breaks.
2. Your customer numbers
This tab is where you add your customer data: how many customers you start the month with, how many new ones you bring in, and how many leave.
The ones who leave are called churned customers. Churn feeds directly into your lifetime value calculation (LTV: the total revenue a customer brings over their whole relationship with you).
A business winning 200 customers a month but losing most of them is not growing the way it looks on the surface. Like an iceberg, the new customers are only the visible part. What matters is how many are quietly leaving underneath. 🧊
Ignore churn and you overestimate your LTV. Scale on overestimated numbers and you lose money faster than you realise.
3. Your revenue and cost of sales
Record what comes in and what it costs to deliver.
One note for NGOs: grants with conditions on how they must be spent do not belong here. Only unrestricted income goes in this tab.
4. Cash balance
This is where everything connects. You start with your opening cash balance, the money currently in your account.
Cash in records everything coming in that month. Cash out records all expenses, cost of sales, and any one-time costs. The difference between the two is your net cash flow.
A negative net cash flow in a given month doesn’t mean you are in trouble. What matters is your closing cash balance, the actual money still in the bank. If that number is healthy, a negative month is just a negative month.
Now go to the financial dashboard and fill in the blue cells with your numbers. Once the data is in, the model starts showing you things.
What the model shows you once the data is in
Once the tabs are filled, the dashboard stops being a template and starts being a window into your business. Here is what to read and what to do with it.
Burn rate, runway, and the traffic light
The dashboard runs a traffic light system:
🪲Green means you are in good shape.
🐥Yellow means pay attention.
🐞 Red means act now.
Burn rate and runway update automatically as you enter your numbers.
Belen demonstrated this live during the session: she increased the customer acquisition cost and the runway dropped from 10 months to 5. One input, one decision, immediate consequence.
As she put it: “If I get wrong assumptions, then I will get wrong results. I might also take wrong decisions because the assumptions were wrong.”
The traffic light is not there to make you feel bad. It’s there to show you the connection between your decisions before reality shows you first.
Unit economics and the LTV to CAC ratio
The unit economics tab pulls from everything already filled in. By the time you reach it, most of the calculation is done automatically. The tab shows revenue per unit, cost per unit, and your contribution margin.
It then calculates your customer acquisition cost (CAC): your marketing and advertising spend divided by the number of new customers that month. And it shows your lifetime value (LTV), using either of two methods depending on the data you have.
The simpler method multiplies average monthly revenue per customer by the number of months they typically stay. The more accurate method accounts for churn and factors in gross margin, giving a more realistic picture because it doesn’t pretend every customer you acquire will stay forever.
The number to watch is the LTV to CAC ratio. Three to one is the benchmark. Below two, the model turns red. Belen was clear on what this means: “If your LTV is lower than your CAC, you are burning money.”
When the ratio drops below 2, every customer you win costs you more to acquire than they bring back in revenue.
The tab also shows your payback period: how long it takes to recover what you spent acquiring a customer. A short payback period alongside a low LTV to CAC ratio is a warning sign.
Both numbers together tell a fuller story than either one alone.
How to build a financial model you can read over time
The dashboard shows your revenue month over month. This is where patterns appear that you can’t see if you’re just living through each month, one at a time.
A nature venture selling restoration services may have a strong spring and a quiet winter. A project relying on grant cycles may see income arrive in unpredictable bursts. 🪸
Seeing this laid out on a timeline changes how you plan.
Belen described it well: “You can see how much you are growing. Is your revenue shrinking? If you sold more in the same month last year, then it’s not a seasonality issue. Something is going on with your business or your customers.”
That kind of comparison is only possible when you have been tracking consistently, which is one more reason to start now rather than waiting until the numbers look more impressive.
Copy the model, test your scenarios
The whole point of knowing how to build a financial model is to use it, break it, and test it. So once your base model is working, Belen recommended making copies and testing different assumptions.
☀️ One copy for the optimistic scenario: what do the numbers look like if you bring in more customers than expected, or costs come in lower?
Most founders only build the optimistic one. That is a bit like a safari guide who only prepares for good weather.
☁️ Another copy for the pessimistic one: what if a key cost doubles, a grant falls through, or customer numbers drop?
This is called sensitivity analysis. The goal is not to predict the future accurately. It is to find which variables matter most to your survival and question them before they move on their own.
A conservation plan built on the assumption that rainfall stays consistent fails the year the drought arrives, not because the plan was bad, but because the variable it depended on was never tested. 🌧️
Financial models break the same way.
Belen gave an example. In a project where energy is a major operating cost, a 20% rise in energy prices shifts the entire net income figure.
Running that scenario in a copy of the model takes minutes. Discovering it from your bank statement takes much longer to recover from.
The value of testing scenarios is not the numbers themselves. It’s the questions they force you to ask before reality asks them for you.
Start before the numbers look perfect
Learning how to build a financial model feels complicated until someone walks you through it tab by tab.
Burn rate, runway, unit economics, the LTV to CAC ratio: four numbers that together tell you whether your nature venture is on solid ground or quietly running out of time.
If you want to fill in Belen’s dashboard correctly and safely, the recording of this masterclass is available inside the Ecopreneur Community, and so is part one for anyone who wants to go back to the foundations first.
Watching alongside the template is the fastest way to make sure your numbers go in the right places.
This article is based on a live Wildya masterclass with Belen Pistek. The recording is available inside our Ecopreneur Community. We host a new masterclass every Tuesday with founders building in the nature space. Join us now.
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