More than a Spreadsheet.
Your pro forma isn't just numbers. It's how investors learn how you think.
Co-authored with Bing Low.
It’s been a few weeks since the last Field Notes. Feels good to be back—and this one’s an important topic.
Bing and I have both spent time on opposite sides of the table when it comes to financial models. He’s built them for founders preparing to raise. I’ve reviewed them as an investor deciding whether to dig deeper. We keep coming back to the same observation: the founders who treat their pro forma as a communication tool—not just a numbers exercise—tend to stand out.
Here’s what we mean.
First Impression in Excel
Your pro forma is often one of the first things an investor sees after the deck. Before the first call, sometimes before they’ve even replied to your email, they’re poking around your model.
A clean, well-structured model signals sophistication. A messy one raises questions before you’ve even had a conversation.
But “clean” doesn’t just mean good formatting. It means being explicit about every assumption—especially when the model gets complicated. Investors shouldn’t have to guess what’s driving the numbers.
Spell it out:
Pricing discounts
Retention rate
Churn
Sales cycle length
Pricing by tier
COGS
If it’s baked into the math, it should be visible on the page.
The key question for founders is: how do we build a bottom-up model with clear explanations for each assumption?
A clean model helps investors understand three things at once:
How the business works
How the founder thinks
Whether the logic behind the numbers is credible
That’s a lot of weight for a spreadsheet to carry—which is exactly why it matters.
Assumptions Over Output
Here’s something that’s easy to miss: investors care less about your projected revenue than you think.
For early-stage companies, the output is usually the goal—the number the founder is aiming for. But the assumptions show the strategy. They reveal how the company plans to get there.
That’s what investors are actually evaluating. Not whether your Year 3 revenue looks impressive, but whether the assumptions underneath it are rational and believable.
A model that says “$10M ARR in three years” is just a number. A model that shows how you get there—through specific customer segments, realistic conversion rates, and defensible pricing—is a plan.
Being clear and specific is critical. A financial model shouldn’t feel like just another spreadsheet to click through. It should communicate the logic of the business in a way that’s easy to follow.
The Takeaway
Your pro forma is more than a forecasting tool. It’s a first impression. It’s a window into how you think. And for many investors, it’s a filter—one that determines whether they keep reading or move on.
Build it like it matters. Because it does.
Legal Disclaimer
This newsletter provides general information and does not constitute legal advice. For specific guidance on your legal matters, consult with a qualified attorney.
Co-authored with Bing Low
Bing is a Senior Financial Analyst at Keystone Innovation District, where he supports Keystone Angel Network deal flow with a major focus on financial due diligence. He previously worked at a private equity-backed organization, where he worked closely with leadership on budgeting, forecasting, financial analysis, and key metrics to support business decision-making.
About Liam
Liam is is the founder of BlackOak Partners, a strategic advisory firm for founders and CEOs navigating fundraising, growth, and transaction readiness. He's also an attorney with a background in tech transactions, M&A, and early-stage investing—including four years as Investment Principal and General Counsel at a Kansas City-based venture fund.
Field Notes for Founders brings practical insights from that experience to help entrepreneurs build smarter companies.