I am sharing everything I saw as interesting and informative about entrepreneurship. It can be a seminar or lecture summary, book, or even Netflix series on this page!

Financial Value of Business

I joined Extra Circular Entrepreneurship Course at the University of Groningen. "Financial Value of Business" was the topic of one lecture from this course I was most interested in.


  • Rabobank - Low risk & low return (credit rating AA+)

  • Booking.com - High risk & high return (very competitive market)

  • Heineken - Low risk& high return (Marketing! similar to Redbull)

  • Philips - High risk & low return (so it is moving to medical equipment)

Building Business

  • Investing (fixed and working capital)

  • Valley of death

  • Funding opportunities

Business Model

  • Revenue and profit model

  • Margin and volume

  • Breakeven point

  • Competitive position

Return on Investment (ROI)

  • Revenue potential per year (such as 30,000 x €100 = € 3M)

  • Marginal potential (revenue - cost) - like 15%

  • Required investments (product development, assets, working capital...)

ROI = Margin / Investment = ...% required

So, ROI includes revenue potential, marginal potential, and required investments of the firm inside of it!

=> The financial part of your business plan should contain the following elements:

  1. Financial specification of the business model

  • Revenue model

  • Cost structure

  • Needed resources

  • Breakeven analysis

  1. Forecasting and analysis of future cash flows

  • Investment fixed and working capital

  • Operational cash flow

  • Payback period

  • RRR (Required rate of return)

  • NPV and IRR (Net Present Value and Internal Rate of Return)

  1. Funding plan

  • How will you finance the development of your business in the different stages of the next 3 to 5 years

  • From seeding money to scaling up to business

  • Bootstrapping

  • Equity financing

  • Debt financing