Rodrigo Wagner

Assistant Professor (Finance Dept.) UAI Business School .

Associate (Researcher) ; Growth Lab. (Harvard)

Board Member, CORFO Entrep Finance & FIA.


LINK TO RESEARCH PAPERS

Business Model Flag Visualization:

  • Most business pitches usually require a bit more quantitative discipline than what they usually present, even if projections (a.k.a. "financials") are still very uncertain and biased.

  • The challenge is to to show some of the projections in a relatively transparent and amenable way, keeping the flow of the presentation, but enabling further questions. Here we developed a visual aid, which brings back the basic economics and managerial accounting into the art of entrepreneurial pitching.

  • Among the advantages of using the "flag model" for pitching is that in a 3-5 seconds one could quickly communicate

    1. Margin and the operational leverage of the business.

    2. Easily observe the break-even quantity.

    3. Eyeballing of how much a change in volume q would impact profits (dProfit/dq).

    4. Visually discuss the four families of strategies for increasing profits: increase p, increase q, lower c, lower F. This brings concreteness and avoids buzzwords.

    5. Space for visual conjectures about the trade-off between price and quantity. That means, discussing about the so called "residual demand curve" faced by the startup.

    6. Similar space for discussing about "supply curve" and the availability of key inputs for the growth narrative