Want FREE Templates on Strategy & Transformation? Download our FREE compilation of 50+ slides. This is an exclusive promotion being run on LinkedIn.

Cash Flow Waterfall with 3 IRR Hurdles   Excel template (XLSX)
$45.00

Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image Cash Flow Waterfall with 3 IRR Hurdles (Excel template (XLSX)) Preview Image
Arrow   Unlock all preview images:   Login Register

Cash Flow Waterfall with 3 IRR Hurdles (Excel XLSX)

File Type: Excel template (XLSX)

$45.00
This template was crafted by a Financial Modeler, Accountant, & Consultant with over 10+ years of experience in developing Real Estate Underwriting tools. He has served 750+ clients, from small family offices to billion-dollar corporations.
Add to Cart
  


BUY WITH CONFIDENCE

Immediate digital download upon purchase.
Lifetime document updates included with purchase.
Fully editable & customizable XLSX document.
Trusted by over 10,000+ organizations.

DESCRIPTION

This product (Cash Flow Waterfall with 3 IRR Hurdles) is an Excel template (XLSX), which you can download immediately upon purchase.

If you are new to IRR hurdles, don't feel bad that it is not immediately clear. Studying the logic and flow of this template will help anyone have a better understanding of how such structures work at a basic level. You most commonly see this type of deal in real estate and oil/gas joint ventures.

Recent Update: Added a DCF Analysis with NPV.

This is a great template for anyone involved in joint venture deals, wants to learn how IRR Hurdles work (the math and logic behind it) and/or anyone looking for a more sophisticated approach to approaching investors for a potential partnership structured as a GP (sponsor or general partner) and LP (investor or limited partner).

All the logic fits on a single page so it can easily be copied and pasted into an existing deal and have the top-line cash contributions and distributions referenced into the top light yellow cells. All the math will run from there.

The purpose of such a strategy is to align incentives. The way this cash flow waterfall works is that based on the defined IRR Hurdles, the LP (the one that contributes most or all of the initial required investment) will give up some of the cash flow as the GP meets higher and higher returns for them.

The GP (the one that does all the work/operations and may contribute a smaller initial investment amount) is then incentivized to do so because that is how they earn a premium for the work they are doing.

This directly incentives the GP to do their job as optimally as possible because that is how they will earn the most money and the LP will receive higher total returns as the GP does a better job with operations.

You can structure this as a hard preferred return / pari passu / or something else just by adjusting the cash flow split percentages in the first hurdle. These kinds of financing structures are most common in businesses with fairly predictable cash flows, but you can use them in any deal you see fit.

Got a question about the product? Email us at support@flevy.com or ask the author directly by using the "Ask the Author a Question" form. If you cannot view the preview above this document description, go here to view the large preview instead.

Source: Best Practices in NPV Calculator, Cash Flow Management Excel: Cash Flow Waterfall with 3 IRR Hurdles Excel (XLSX) Spreadsheet, Jason Varner | SmartHelping


$45.00
This template was crafted by a Financial Modeler, Accountant, & Consultant with over 10+ years of experience in developing Real Estate Underwriting tools. He has served 750+ clients, from small family offices to billion-dollar corporations.
Add to Cart
  

OVERVIEW

File Type: Excel xlsx (XLSX)
File Size: 37.8 KB

ABOUT THE AUTHOR

Additional documents from author: 156

I graduated in 2011 with a Bachelors degree in Accounting. From there, I worked at a few small businesses doing financial reporting and some bookkeeping. After a few years of that, I started doing freelance financial consulting work on Elance and Upwork.

After over 400 jobs completed with a 100% success rate, I now run my own modeling/consulting practice and continue to build new financial models every few weeks. [read more]

Ask the Author a Question

Must be logged in

Did you know?
The average daily rate of a McKinsey consultant is $6,625 (not including expenses). The average price of a Flevy document is $65.
Bundle and save! You can save up to % with bundles!

View bundle(s)




Trusted by over 10,000+ Client Organizations
Since 2012, we have provided best practices to over 10,000 businesses and organizations of all sizes, from startups and small businesses to the Fortune 100, in over 130 countries.
AT&T GE Cisco Intel IBM Coke Dell Toyota HP Nike Samsung Microsoft Astrazeneca JP Morgan KPMG Walgreens Walmart 3M Kaiser Oracle SAP Google E&Y Volvo Bosch Merck Fedex Shell Amgen Eli Lilly Roche AIG Abbott Amazon PwC T-Mobile Broadcom Bayer Pearson Titleist ConEd Pfizer NTT Data Schwab




Read Customer Testimonials




Save with Bundles

This document is available as part of the following discounted bundle(s):

Save %!
Joint Venture Cash Flow Waterfalls

This bundle contains 9 total documents. See all the documents to the right.

$199.00


Add Bundle & Save

Save %!
Real Estate Underwriting Templates / Deal Analyzers

This bundle contains 21 total documents. See all the documents to the right.

$299.00


Add Bundle & Save


Customers Also Bought These Documents


Customers Also Like These Documents

Related Management Topics


Cash Flow Management Joint Venture Cash Conversion Cycle Business Resilience Working Capital Management Restructuring Insolvency NPV Calculator

Download our FREE Strategy & Transformation Framework Templates

Download our free compilation of 50+ Strategy & Transformation slides and templates. Frameworks include McKinsey 7-S Strategy Model, Balanced Scorecard, Disruptive Innovation, BCG Experience Curve, and many more.