skills/three-statement-model-builder/references/industry-playbooks.md

# Industry and Business Model Playbooks

Use this reference to adapt the 3-statement model to the company's business model. Do not force a generic revenue-growth model when the economics require driver logic.

## SaaS and subscription software

Core drivers:

- ARR / MRR
- new bookings
- churn / retention
- expansion / contraction
- customer count
- ARPA / ARPU
- billings and deferred revenue
- CAC, sales capacity, and payback
- gross margin by hosting, support, and services mix

Important schedules:

- ARR bridge
- deferred revenue
- sales and marketing productivity
- headcount by function
- hosting / infrastructure cost
- capitalized software, if material

Senior challenges:

- Does revenue recognition align with billings?
- Are churn and expansion assumptions credible?
- Does sales capacity support bookings?
- Does deferred revenue drive cash timing correctly?
- Is CAC efficiency plausible?

## Marketplace / platform

Core drivers:

- GMV
- take rate
- transaction volume
- buyer / seller count
- attach rates
- payments, fulfillment, or platform costs
- incentives, credits, or subsidies

Important schedules:

- GMV build
- take-rate bridge
- transaction economics
- variable cost stack
- working capital / settlement timing

Senior challenges:

- Does revenue reflect gross vs net presentation correctly?
- Are incentives treated consistently?
- Does volume growth require marketing or working capital investment?
- Does take-rate expansion have a credible reason?

## Ecommerce / retail

Core drivers:

- traffic
- conversion rate
- average order value
- units sold
- same-store sales
- new store openings
- store productivity
- inventory turns
- return rate
- fulfillment and shipping costs

Important schedules:

- store / channel build
- inventory and turns
- gross margin bridge
- fulfillment cost
- marketing spend
- lease / rent schedule if material

Senior challenges:

- Does inventory investment support sales growth?
- Are returns and discounts reflected?
- Do gross margin assumptions consider mix and shipping?
- Does store opening capex match growth?

## Manufacturing / industrial

Core drivers:

- units produced and sold
- average selling price
- utilization
- backlog
- materials cost
- labor cost
- overhead absorption
- maintenance and growth capex
- inventory and receivables cycles

Important schedules:

- volume and price build
- plant / capacity schedule
- COGS by material, labor, overhead
- inventory schedule
- capex and depreciation

Senior challenges:

- Can capacity support forecast volume?
- Are input cost changes reflected in margins?
- Does working capital grow with production?
- Is maintenance capex sufficient?

## Professional services / consulting

Core drivers:

- billable headcount
- utilization
- bill rate
- project backlog
- revenue per professional
- subcontractor cost
- compensation and bonus

Important schedules:

- headcount by level
- utilization and bill rate
- revenue per FTE
- compensation model
- AR / DSO schedule

Senior challenges:

- Does hiring precede revenue appropriately?
- Are utilization and rates realistic together?
- Does compensation scale with headcount and revenue?
- Does cash collection lag revenue?

## Consumer / media / advertising

Core drivers:

- users / subscribers
- engagement
- impressions
- CPM / ARPU
- churn
- content costs
- acquisition spend

Important schedules:

- user cohort or subscriber bridge
- advertising yield
- content / programming cost
- marketing efficiency

Senior challenges:

- Are user growth and monetization assumptions compatible?
- Is content investment sufficient to support retention?
- Does marketing efficiency deteriorate at scale?

## Healthcare / biotech

Core drivers:

- pipeline milestones
- R&D spend
- clinical trial timing
- regulatory events
- launch assumptions
- reimbursement / pricing
- manufacturing or COGS

Important schedules:

- R&D program spend
- milestone timing
- cash runway
- financing needs
- launch ramp if commercial

Senior challenges:

- Is cash runway modeled realistically?
- Are milestone and financing assumptions explicit?
- Are regulatory risks reflected in scenario cases?
- Is revenue too certain before approval?

## Real estate / project finance

Core drivers:

- occupancy
- rent / rate
- development cost
- construction draw schedule
- debt draw and amortization
- interest capitalization
- lease-up timing
- operating expenses

Important schedules:

- development budget
- construction draw
- debt and interest reserve
- lease-up
- NOI
- waterfall, if applicable

Senior challenges:

- Does debt fund construction in the right order?
- Is interest capitalized or cash paid correctly?
- Does lease-up timing match cash burn?
- Are reserves and restricted cash modeled?

## Financial institutions

Banks, insurers, lenders, and asset managers often require specialized models. Do not force an industrial 3-statement format when regulatory capital, loan balances, deposits, premiums, claims, AUM, or fair value marks drive the business.

For these companies, adapt the model around:

- earning assets and liabilities
- net interest margin or fee income
- credit losses or claims
- capital ratios
- AUM / flows
- regulatory or solvency constraints
- cash flow presentation appropriate to the business

Clearly state when a specialized financial-institution model is required.

## Turnaround / distressed company

Core drivers:

- liquidity runway
- weekly or monthly cash flows
- vendor terms
- payroll timing
- revolver availability
- covenant compliance
- restructuring costs
- asset sales
- cash preservation measures

Important schedules:

- 13-week or monthly cash flow
- liquidity bridge
- debt and covenant schedule
- restructuring cost schedule
- vendor / AP aging if available

Senior challenges:

- Does the model show actual liquidity stress?
- Are cash disbursements timed correctly?
- Are covenant and borrowing-base constraints included?
- Are turnaround savings credible and phased?