Founder Puzzles. Model first, jump later. 2nd Edition

Excel is cheaper than real life. Model first, jump later.

Founder Puzzles, 2nd Edition adds 5 new chapters, 4 of which are new frameworks.

• Size markets using real data
• Select and filter ideas based on implied potential
• Understand investor mindset and why investors say no
• Project growth in times of extreme uncertainty

Real world questions. Real world models. Real world answers.

Imagine an objective framework to rank relative viability of a business before investing years of your life in it.

It takes 2 to 8 years for the payoff from an idea to be realized. Wouldn’t it be better to know the odds in your favor before you back a concept with real work? Even better put yourself on the same page as investors on day one.

In the tight rope routine most startups and founders walk on a daily basis, there is very little bandwidth for rude unexpected surprises.

6 years in the making. 419 pages. 2 decades of founder experience in Ed-Tech, Risk-Tech, consulting and financial services across 4 continents.

On the Zen of building financial models. When it comes to understanding the math behind a startup, an idea or a product, where should we start? What questions should we ask?  What models should we build?

What if we have no background in finance?

As founders we often start on the wrong foot when it comes to financial modeling for our ideas. Most often when we think we have it sorted, we build the wrong models, we ask the wrong questions.

Founder Puzzles shows you how to use simple frameworks in Excel to identify the right choices by asking the right questions, right at the start.

Identify effective decisions as founders using frameworks that give you quick answers. From pricing products to sizing markets. From projecting revenues to estimating optimal bet size.

Understanding unit economics. If you can't make money on a single order, can you make it with on a thousand orders? A clear dissection of break even costs, contribution margin, customer acquisition costs (CAC) and life time value (LTV) of customers. Why CAC < LTV is one of the most important equation we need to understand as founders. 

Projecting revenues. If you sell products  what is the simplest way of projecting income for the next 3 to 5 years. How fast can you grow and what are the drivers for that growth? 

How do you use such a model to decide whether to invest in better servers, relevant content, improved SEO, higher conversion or all of the above. If you could only do one, which one should you pick? Which one would a quick financial analysis recommend?

Getting quick answers fast. Whether it is unit economics, projecting revenues or pricing products, spending time upfront in identifying questions we want to ask is a worthwhile investment. Start with a simple bare bone model first. Model building, like minimum viable products is an iterative exercise. 

Live case studies. The book uses live case studies to based on businesses in the real world to illustrate concepts and examples.

Maya's closet. An online specialized retailer focuses on the toddler and pre-teen clothing and accessories market. A case study with four versions of a financial model ranging from the very simple to complex. 

Grant Application. A grant application for a reader revenue supported news analysis and commentary site. The application was used for a Google News Initiative grant competition and made it through two rounds of selection. A simplified model with a detailed review of revenues sources and primary expenses.

GEMS Education. A private school system negotiating a new line of credit from their bankers. This is our most complex model on offer. To give you a sense of how quickly complexity can get out of hand. Two models are included. A data dump along with chapter 16 asks you to complete the model on your own as a capstone final case. A solved solution is included for self assessment once you are done with building your version. 

Primary skill set. Teaches basic financial modeling and analysis for founders, startups and creators using a mix of frameworks, case studies and partially completed Excel sheets with solved solutions.

Chapter list. 

• 7 lessons from finance for founders
• Modeling revenues
• Unit Economics for startups
• Pricing Fundamentals
• Value based Pricing
• Market Sizing
• Selecting ideas
• Understanding Investor Mindset
• Raising 6 at 18 post
• Revenue Models for content plays
• Products vs Services
• An introduction to valuations
• Real world Models. Bringing it all together.
• GEMS Education. A private equity case study
• Kelly criterion. Founders, Risk and bet size
• Lessons from launch.
• Reality Checks. 
• Modeling growth in the middle of a pandemic
• Power moves. Linking financials

Live cases walk through include:

• Modelling revenues 
• Unit economics 
• Sizing markets 
• Investor mindset
• Valuation land mines 
• Launch
• Founder risks
• Financial projections

Why should you read the 2nd edition of Founder Puzzles?

Startup founders need decision-making frameworks that they can understand and relate to. Without needing background in finance, modeling, or business.

We wrote the first edition of Founder Puzzles as a toolkit for founders using language founders could understand. Identifying puzzles we solved, lessons we learnt, taught, and used. In 2020 during a global pandemic print wasn’t an option. But despite that two digital editions of the book were well received.

When the time came to write the 2nd edition, we asked ourselves what we missed on our first pass. Some important modeling lessons were overlooked, we needed a deeper treatment on growth, on idea selection filters and on respecting data. Also raising capital in down markets, validating assumptions before making decisions, and two paths to a market sizing exercise.

Founders often struggle with sizing target markets, leading to inaccurate assumptions and choices. A large part of this problem is the availability of data. We used five different live market sizing engagements (in retail, insurance, eCommerce, logistics and payments) as context for this chapter. The market sizing exercises leads directly into conversion, growth, scale and valuation discussions.

What is included

The book package includes 3 books and 10 Excel files:

Founder Puzzle, 2nd Edition, Better Excel Charts and Reboot, 3rd Edition. 

Excel files include 3 financial models. For an online retail store. For a content business. For a brick and mortar school system. 

• Maya A-1 - simple
• Maya A-5 - complete
• Maya E-1 - advance
• Maya E-9 - complete solved solution
• GEMS Simplified Model - starting point
• GEMS Version 6.5 - complete solved solution
• Valuation examples pre and post - example
• Valuation multiples ver3.0 - example 
• Google-GNI-Application-Financial-Model - example 
• Maya Closet Unit Economics Debt Service Analysis - example

What is not included?

This book is not an Excel tutorial or guide. The book doesn't teach you how to work with Excel. It teaches how to answer questions by building simple and relevant models in Excel mostly for technology businesses.

The cases covered in the book do not include a manufacturing or industrial business and have a strong tech bias.

The Excel files are illustrative templates that will need work to extend and customize for your own business or ideas.

Who is the author?

Jawwad Farid is a serial founder. He is a Fellow Society of Actuaries, a MBA from Columbia Business School and a computer scientist, who has been mentoring and helping technology founders make sense of their business models for twenty five years.

Jawwad has launched products on three continents, mentored teams across the world, run businesses, raised funding multiple times, taught graduate and undergraduate students in business and computer science and served as a head judge at the Asia Pacific ICT Awards for 13 years.

The material for this book came out of his mentoring and teaching experience and his popular founder's boot camp at the Nest I/O Tech Incubator in Karachi.

Jawwad ran the boot camp for 12 cohorts between 2015-2021 as well as taught the Entrepreneurship course at the SP Jain Global MBA program in Dubai from 2007-2014 as an adjunct Professor.

Check out his LinkedIn profile at - https://www.linkedin.com/in/jawwad-farid/

Free Sample content. See below for free sample materials from the book. 

• Founder Puzzles, Revised Ed. Book Preface. Sound cloud. 16 minutes. Preface, Founder Puzzles.
• Founder Puzzles. Original Ed. Book Launch video. YouTube. 8. minutes. 
• Founder Puzzles, Revised Ed. Chapter 14. Launch Lessons. 36 minutes. 
• Founder Puzzles, 2nd Ed. Chapter 19. Pakistan Middle Class, 25 minutes

Questions: Happy to answer them. Please drop me a note on jawwad@financetrainingcourse.com

Refunds: 60 days no questions asked. If you are not happy with your purchase or quality of content, please drop me a note and we will process your refund in full.

Keywords: Financial Modeling, Excel Templates, Finance, Startup Finance, Founder Finance, Finance models for dummies