3-year financial model
A pilot-led model for an enterprise and mid-market sales business. £10k paid pilots convert into Growth (£20k) and Enterprise (£45k) subscriptions, with two large institutional deals. The £600k raise reaches £2.23m exit ARR in Year 3, with operating profit from M19.
ARR by month, base case (solid) against the stress case with every Enterprise and large-deal win six months late (dashed)
Cash balance with the £600k raise. Base case low is £281k at M19; stress case low is £184k at M23.
Monthly operating costs against monthly revenue. Costs step up with each sales and customer success hire; revenue overtakes costs from M19.
Active paid accounts by tier — Growth (£20k), Enterprise (£45k) and large deals (£120k from M18, £200k from M30)
Three-year summary
| Metric | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| Qualified conversations | 150 | 438 | 662 |
| Pilots started | 9 | 26 | 40 |
| Active Growth accounts (year end) | 6 | 19 | 39 |
| Active Enterprise accounts (year end) | 5 | 12 | 25 |
| Large deals landed | — | £120k (M18) | £200k (M30) |
| Total revenue | £266k | £844k | £1.90m |
| Exit ARR (recurring only) | £345k | £1.04m | £2.23m |
| Team costs | £373k | £570k | £815k |
| Delivery and platform | £71k | £177k | £294k |
| Other operating (incl. events) | £82k | £104k | £121k |
| Operating costs | £525k | £851k | £1.23m |
| Operating profit | (£260k) | (£7k) | £665k |
| Sales / customer success headcount (year end) | 1 / 0 | 2 / 2 | 3 / 3 |
| Cash at year end (with £600k raise) | £350k | £374k | £1.10m |
Corporation tax is charged at 25% with losses carried forward. The Year 3 charge of £100k falls due after M36, so no tax is paid within the model period. VAT is paid quarterly.
Year one detail
| Month | Accounts | ARR | Revenue | Costs | Net cash | Cash |
|---|---|---|---|---|---|---|
| M1 Pilot fees | 0 | £0 | £50k | £35k | +£24k | £624k |
| M2 | 1 | £20k | £12k | £37k | −£25k | £599k |
| M3 First conversions | 4 | £130k | −£9k | £62k | −£78k | £520k |
| M4 | 5 | £175k | £15k | £45k | −£32k | £488k |
| M5 | 6 | £195k | £26k | £43k | −£15k | £473k |
| M6 | 6 | £195k | £26k | £36k | −£7k | £467k |
| M7 | 7 | £215k | £8k | £36k | −£33k | £433k |
| M8 | 8 | £235k | £30k | £38k | −£5k | £428k |
| M9 First sales hire | 9 | £280k | £23k | £55k | −£30k | £398k |
| M10 | 9 | £280k | £33k | £44k | −£11k | £387k |
| M11 | 9 | £280k | £23k | £40k | −£13k | £374k |
| M12 Year 1 close | 11 | £345k | £29k | £55k | −£23k | £350k |
M1 revenue includes the £10k fee from each of the four paying pilots running at M0. Revenue dips below zero in M3 because pilot fees are credited against year one when pilots convert. Net cash includes VAT timing. Costs cover the founding team, sales and customer success hires with NI, pension and commission, pilot delivery, AI and infrastructure, professional services, marketing and events, office, apps and hardware.
Base case and stress case
The raise is sized on a stress case where every Enterprise and large-deal win lands six months late. The £600k keeps cash above a £150k buffer throughout.
| Metric | Base case | 6-month Enterprise delay |
|---|---|---|
| Exit ARR (M36) | £2.23m | £1.91m |
| Year 3 revenue | £1.90m | £1.53m |
| Enterprise accounts (M36) | 25 | 18 |
| Lowest cumulative cash flow before funding | −£319k (M19) | −£416k (M23) |
| Lowest cash balance (with raise) | £281k | £184k |
| Operating profit from (sustained) | M19 | M25 |
| Cash at M36 | £1.10m | £625k |
Team plan
The team grows from four to ten over three years. Sales hires follow conversation volume; customer success hires follow account load. There are no contractors and no agency fees.
ARR milestones and investor path
Years 1–3 come from the monthly model. The model assumes Month 1 is January 2027. Years 4–5 are venture-path targets: they, and a £3.0m Year 3, depend on a seed round from M21. The £600k cost base alone reaches £2.23m ARR in Year 3.
| Exit ARR | Year 1 | Year 2 | Year 3 | Year 4 | Year 5 |
|---|---|---|---|---|---|
| £600k plan (model) | £345k | £1.04m | £2.23m | — | — |
| With seed from M21 (target) | £345k | £1.04m | £3.0m | £6.5m | £15m |
| ARR milestone | Month | Calendar |
|---|---|---|
| £500k ARR | M17 | May 2028 |
| £1m ARR | M23 | Nov 2028 |
| £2m ARR | M34 | Oct 2029 |
ARR at the seed target month (M21, Sep 2028) is £890k, inside the typical £0.5–1.5m seed range for UK/EU B2B SaaS. At a 10× ARR multiple on £15m Year 5 ARR, the implied valuation is £150m. The pre-seed stake is 16.7% at the raise and stays at 16.7% once the option pool is created, because the pool comes from the founder's shares. After seed and Series A (20% dilution each) it is 10.7%, valued at £16.0m: about 27× the £600k raise. These are illustrative targets, not forecasts.