- people on the move
- Click here for COVID-19 updates
Startup standardizes financial projections
A pair of brothers have developed an online platform, with thousands of users, to help entrepreneurs create realistic financial projections for lenders and investors.
Start Garden, the $15-million seed fund in Grand Rapids, said this month that it will make an initial $5,000 investment in ProjectionHub.
Template for projections
ProjectionHub is designed for entrepreneurs and businesses to follow a step-by-step process to create financial projections, rather than wading through data entries in spreadsheet software.
Adam Hoeksema, co-founder of ProjectionHub and a micro-lender, said the web app helps entrepreneurs create financial projections that are typically requested by lenders or investors.
“A lot of the time, people use these complex Excel templates, and it can be really confusing,” Hoeksema said. “Our process takes you through a web app — kind of like TurboTax for financial projections.
“I manage an SBA micro-loan program, and we are constantly asking our loan applicants to create projections. I was trying different templates and could never find one that worked for everyone. Most people would look at all the tabs in the spreadsheet and get the deer-in-the-headlight look and give up.”
Hoeksema and his brother, Brandon Hoeksema, began developing a program to address the issue after not finding a template or process similar to ProjectionHub.
“We have had about 10,000 people who signed up to use the tool over the past couple years,” Hoeksema said. “About two-thirds of our users identify themselves as startups. We see a lot of software-as-a-service companies that are using it to create projections for potential investors and mobile-app companies.”
For a $5 monthly subscription or a seven-day free trial, ProjectionHub users receive documents: a one-to-three year monthly income statement, balance sheet and cash flow feature; projection narrative; loan module; ratio analysis; investment module; and a three-year income statement comparison.
“We have a lot of data, and about seventy-five percent of those users are projecting to raise capital,” Hoeksema said. “What we would like to do is go back to those users and ask them if they were successful in getting that loan or investment and taking that data to try to run some analysis.
“It is really to survey our past users to try to get data on whether they were successful in raising money and then see what we can learn from that data.”
The Hoeksema brothers recently hired the web development and design firm Foxio in Fishers, Ind. to create a new version of the website to increase user friendliness.
ProjectionHub is also planning on releasing several new features in the next few months, including integration with QuickBooks.
In response to the investment by Start Garden, Hoeksema said they’re really excited, and it confirms the need for a financial-projection product like ProjectionHub.
“I think it is just validation for us that this is a significant problem that does need to be solved and validation that hopefully we are on the right track,” Hoeksema said.
He added that the startup is “excited to learn from the folks at Start Garden” who will “hopefully help us accelerate our growth and development through what they can bring to the table.”