Creating a Cloud Business Growth Model
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Transcript of Creating a Cloud Business Growth Model
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Creating a Cloud Business Growth Model
This video provides a quick overview of the Business Growth Model
and how to use it to build your own CSB financial Plan
Dave Zwicker, MSPexcellenceNovember 2013
CSBcommunity Mini-Tutorial
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Copyright © 2013 MSPexcellence 2Page
Why Create a Financial Plan?
• How big of a business can you build and how fast?
• What are the performance goals for key contributors?
• What is the cash flow impact and investment required?
• Where should you focus to maximize your success?
- Pricing changes - Sales expansion
- New services - Cost reductions
- New markets - Recurring revenue
www.CSBcommunity.com
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Copyright © 2013 MSPexcellence 3Page
Know Your Existing Business
Average Deal Value: Average users per deal Revenue per user (OTR and MRR) Revenue per deal (OTR and MRR)
Sales Productivity Number of sales reps OTR/MRR deals per month per rep OTR/MRR from same or different deals?
Customer Acquisition Cost Sales rep compensation Cost per lead Conversion rates Other S&M expenses
Average Gross Margin GM% for OTR GM% for MRR
www.CSBcommunity.com
Calculate thegrowth factorsof your business
1
Use them as your assumptions for modeling growth
2
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Copyright © 2013 MSPexcellence 4Page
What Is Your Growth Strategy?
• Sell to larger, more profitable customers
• Add new services to increase deal value
• Expand your sales force and increase productivity
• Reduce your customer acquisition cost
• Increase margins with higher operating efficiency
• Transition from one-time to recurring revenue
www.CSBcommunity.com
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Copyright © 2013 MSPexcellence 5Page
What Are The Growth Assumptions?
www.CSBcommunity.com
Increase Deal Value:
– Target larger customers – what size?
– Add new cloud services – which ones?
Increase Sales Productivity
– Add more sales reps – how many?
– Accelerate the sales cycle – by how much?
Customer Acquisition Cost
– Reduce salaries/change comp plan?
– Increase marketing effectiveness?
Average Gross Margin
– Raise service fees?
– Reduce cost of service delivery?
Create achievable growth factors
1
Input assumptions into a financial model
2
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Copyright © 2013 MSPexcellence 7Pagewww.CSBcommunity.com
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Copyright © 2013 MSPexcellence 8Pagewww.CSBcommunity.com
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Copyright © 2013 MSPexcellence 9Pagewww.CSBcommunity.com
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EXISTING BUSINESS TRAJECTORY
IDEAL BUSINESS TRAJECTORY
GROWTH!
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Copyright © 2013 MSPexcellence 11Pagewww.CSBcommunity.com
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Copyright © 2013 MSPexcellence 13Pagewww.CSBcommunity.com
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Copyright © 2013 MSPexcellence 14Page
Build Your Own Growth Model
• Visit www.CSBcommunity.com
• Register as a member (it’s free)
• Download the CSB Growth Model at no cost ($129 value)
• Read about all 3 Critical Success Factors (CSFs)
• CSF#1 covers Creating a Cloud Business Growth Plan
• You will find a link to the model there…
www.CSBcommunity.com
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Copyright © 2013 MSPexcellence 15Page
Accelerate Your Transformation
• CSBaccelerator Program– 5 Sessions that cover all 3 Critical Success Factors– Online workshops, business coaching and toolset– Course Fee: $1199– Enroll today!
• CSBadvisor Service– Direct consulting engagement with MSPexcellence– Customized Success Plan– Project Fee: Tailored to your budget and timeline– Contact MSPexcellence ([email protected])
www.CSBcommunity.com
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Join the CSBcommunity!For more information, contact MSPexcellence:
And be sure to visit: www.csbcommunity.com
Copyright © 2013 MSPexcellence.com