At pre-seed, nobody expects your Year 3 revenue number to be accurate.
There are too many things you do not know yet. Your pricing may change, your sales cycle may be longer than expected and your first customers may use the product differently from the way you imagined.
That does not make the financial model pointless.
An investor is looking at what has to happen for you to reach the number. How many customers do you need? At what price? How long do they take to close? How many people must you hire to sell to and support them? What happens to cash while you wait?
I often see founders start with a round number, usually a very large one, and work backwards until the spreadsheet produces it.
Let's not forget that excel is very cooperative. It will give you $50 million if you ask nicely enough. The trouble starts when I ask what produces that revenue and the assumptions do not match the way the customer actually buys.
Building bottom-up does not mean pretending you know things you cannot yet know. A pre-seed founder may not have a reliable close rate or CAC. That is fine. Label it as an assumption. Explain where it came from. Use a range if the answer is genuinely uncertain.
The model should also react when an assumption changes. If I move the sales cycle from three months to six, revenue and cash should move with it. If they barely change, either the model is broken or the sales cycle was never driving the forecast.
That is a much more useful test than debating whether Year 3 revenue should be $38 million or $42 million.
