Serverless Computing (FaaS) Startup Financial Model (Excel XLSX)

Serverless computing is a very specific type of cloud computing service whereby the service provider will run / execute specific functions when they are called and then shut off once the function is done running. No data is stored (hence serverless). It is possible that the functions transmit data out of the network. This is commonly referred to as 'function-as-a-service'.

This financial model was designed to specifically handle assumptions for a FaaS business. Core logic for revenue is a configuration for up to 6 customer types, which all have potentially different retention rates and usage / subscription pricing options. For each customer type, the user can configure the average monthly functions used, the average time it takes for a function to run, and the amount of GBs in use.

There are four pricing configurations:
1. Price per Request
2. Price per GB-seconds Used
3. Price per GB transmitted
4. A fixed monthly price

The cost of goods sold primarily involves purchasing the infrastructure that provides this service, which is depreciated over a useful life. It is considered a non-cash cost of goods sold item and treated accordingly in the financial statements. There are a few other cost of goods sold inputs available and these include a general cost per customer per month, a cost per function ran per type (two input schedules for up to two cost types), and a cost per GB transmitted.

There are also fixed overheads to account for operating expenses such as legal fees, property taxes, personnel salaries, and other fixed operating costs that can be adjusted each year.

Everything rolls into a 3-statement model (monthly and annual income statement, balance sheet, and cash flow statement). There is also a DCF Analysis for the project and investor / operator, depending on how the project is being financed. I've also included key metrics such as IRR, NPV, average customer lifetime value, CaC, months to pay back CaC, and LTV to CaC ratio.

An instructional video is included in the file.