POST #6: DYNAMIC FINANCIAL MODELING
An experienced financial analyst knows that no financial model is perfect, and everything is subject to change before a deal is finalized. That’s why it’s crucial to build a dynamic model where key variables can be easily adjusted to see their impact on financials and valuations.
Identifying the variable inputs, especially in the revenue model, is critical. Flexibility to modify growth rates, benchmarks, and timelines will save time and money. If your forecast isn’t adaptable to changing conditions, it becomes obsolete quickly. Always ensure your variables are easily adjustable for different scenarios.