How to add in additional revenue streams

The revenue model in the Standard Model enables you to model up to two revenue streams from one or two user bases. Here's how you can add in more revenue streams.

A common question I get asked is “how do I build in additional revenue streams”?

The default revenue model forecasts up to two revenue streams from one or two user bases, but you may find yourself needing to add in more revenue streams or more user bases.

Here’s an overview on how the prebuilt revenue streams feed into the model and how you can add in additional revenue items or replace the prebuilt ones:

To provide more detail to the video, there’s a couple ways to add in additional custom revenue streams: 1

  • Add the new revenue stream(s) to Forecast sheet or a new sheet, then link into the Revenues section on Forecast. This is a fairly simple and common method. If the default revenue model is a good structure for calculating some of your revenue streams, and you want to add a new revenue stream that is either not a great fit for the default structure, or a new revenue stream that is tied to a new user base, then I’ll create a new set of calculations for this new revenue stream. If it’s really simple, I’ll just do it at the top of the Forecast and link into the revenues section on the Forecast sheet. If it’s more complex, or I want to make it separate from the default structure, I’ll create a new sheet for it. And then I’ll link the new revenue stream(s) into Forecast. 1
  • Use the prebuilt Forecasting Drivers in the empty Revenues lines. You can also use the prebuilt forecasting drivers embedded in the blank revenue lines to create additional revenue streams based on growth rates, percentages of other revenue streams, or based on operating metrics calculated in the model. Learn more at Forecasting Drivers.
  • Use an existing revenue forecast and link into the Revenues section on Forecast. This follows the BYOM approach by allowing you to use your existing revenue forecast and simply link in the revenues, billings (optional), bookings (optional), and any cost of sales, acquisition, and other expenses you may calculate in the process of creating your revenue forecast. Simply link them into the appopriate revenues and expenses section on the Forecast sheet, and everything will flow into the rest of the model to create financial statements, charts, and summaries.

  1. If you are using the Starter Model, adding in new revenue streams is fairly easy since the default structure has no prebuilt logic for growth and revenues, so it’s easy to build in your own however you want. Simply add them to the Forecast sheet or create a new sheet for Revenues to forecast your revenue streams. 

Was this helpful? Yes / No

Thanks, I appreciate the feedback.