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What Investors Actually Want | Traditional vs Modern Approach | Key Reports Explained | Using hisabkitab | Best Practices

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Introduction: The Investor Meeting Reality

The email arrives: "Can you send us your financial statements for last 12 months? We'd like to review before our meeting on Friday."

It's Tuesday evening.

Two scenarios:

Scenario A (Traditional):

● Panic mode activated

● Call CA frantically

● Pull data from multiple Excel files

● Manually compile reports

● Format everything

● Work till midnight

● Still send incomplete data

● Investor meeting postponed

Scenario B (Modern):

● Open accounting software

● Click "Generate Reports"

● Select date range: Last 12 months

● Click "Export PDF"

● Email sent in 2 minutes

● Investor impressed by speed and professionalism

● Meeting proceeds as scheduled

The difference? Having the right system that maintains investor-ready financials automatically.

What Investors Actually Want to See

The Core Financial Statements

Profit & Loss Statement (P&L)

● Revenue breakdown

● Cost of goods sold

● Operating expenses

● EBITDA (Earnings Before Interest, Tax, Depreciation, Amortization)

● Net profit/loss

● Monthly for last 12-24 months

Balance Sheet

● Assets (current and fixed)

● Liabilities (current and long-term)

● Equity

● As of latest month-end

Cash Flow Statement

● Operating cash flow

● Investing cash flow

● Financing cash flow

● Net cash position

● Monthly for last 12 months

The Business Metrics

Burn Rate & Runway

● Monthly cash burn

● Current bank balance

● Months of runway remaining

● Burn rate trend

Unit Economics

● Customer Acquisition Cost (CAC)

● Lifetime Value (LTV)

● LTV:CAC ratio

● Gross margin per product/service

● Contribution margin

Growth Metrics

● Monthly Recurring Revenue (MRR) - if applicable

● Month-over-month growth rate

● Year-over-year comparisons

● Customer count and growth

Key Performance Indicators (KPIs)

● Revenue per employee

● Customer acquisition trends

● Churn rate (if SaaS)

● Inventory turnover (if trading)

● Days Sales Outstanding (DSO)

Traditional Approach (Time-Consuming)

The Manual Process

Step 1: Data Collection (2-4 hours)

● Export data from Tally/Excel

● Gather bank statements

● Compile invoice records

● Collect expense receipts

● Track payment records

Step 2: Data Compilation (3-5 hours)

● Create P&L in Excel manually

● Build Balance Sheet

● Calculate cash flows

● Reconcile discrepancies

● Fix data errors

Step 3: Calculate Metrics (2-3 hours)

● Manually compute burn rate

● Calculate CAC and LTV

● Determine growth rates

● Compute KPIs

● Build charts and graphs

Step 4: Formatting (2-3 hours)

● Make it presentable

● Add company branding

● Create professional layout

● Generate PDFs

● Proof-read everything

Total Time: 9-15 hours

Problems:

● Error-prone (manual calculations)

● Always outdated (point-in-time)

● Inconsistent formatting

● Can't quickly update

● Stressful and rushed

Modern Approach (Automated)

Using Proper Accounting Software

Real-time data entry:

● Transactions recorded as they happen

● Bank feeds auto-import

● Invoices create entries automatically

● OCR extracts data from documents

Automatic calculations:

● Software maintains all ledgers

● Calculates all statements automatically

● Updates in real-time

● No manual computation needed

One-click reporting:

● Pre-built report templates

● Select date range

● Click generate

● Export to PDF

● Done in minutes

Always current:

● Data always up-to-date

● Can generate reports anytime

● Last-minute requests? No problem

● Multiple formats available

Key Reports Explained

Profit & Loss Statement (Income Statement)

What it shows:

Revenue Rs 50,00,000

Less: Cost of Goods Sold Rs 20,00,000

= Gross Profit Rs 30,00,000

Less: Operating Expenses Rs 18,00,000

= EBITDA Rs 12,00,000

Less: Depreciation Rs 2,00,000

Less: Interest Rs 1,00,000

= Profit Before Tax Rs 9,00,000

Less: Tax Rs 2,70,000

= Net Profit Rs 6,30,000

Investor focus:

● Gross margin % (30/50 = 60%)

● EBITDA margin % (12/50 = 24%)

● Net profit margin % (6.3/50 = 12.6%)

● Growth trends month-over-month

How to prepare manually:

List all revenue sources

Calculate total COGS

List all expense categories

Calculate subtotals

Compute margins

Time: 2-3 hours

With software: Click "P&L Report" → Select dates → Export Time: 30 seconds

Balance Sheet

What it shows:

ASSETS

Current Assets

Cash & Bank Rs 15,00,000

Accounts Receivable Rs 12,00,000

Inventory Rs 8,00,000

Total Current Assets Rs 35,00,000

Fixed Assets

Equipment Rs 10,00,000

Less: Depreciation Rs 2,00,000

Net Fixed Assets Rs 8,00,000

Total Assets Rs 43,00,000

LIABILITIES

Current Liabilities

Accounts Payable Rs 8,00,000

Short-term Loans Rs 5,00,000

Total Current Liabilities Rs 13,00,000

Long-term Liabilities

Term Loans Rs 10,00,000

Total Liabilities Rs 23,00,000

EQUITY

Share Capital Rs 15,00,000

Retained Earnings Rs 5,00,000

Total Equity Rs 20,00,000

Total Liabilities + Equity Rs 43,00,000

Investor focus:

● Current ratio (35/13 = 2.7x - healthy)

● Debt-to-equity ratio (23/20 = 1.15x)

● Working capital (35-13 = Rs 22L)

Manual preparation: 3-4 hours With software: 30 seconds

Cash Flow Statement

What it shows:

Opening Cash Balance Rs 10,00,000

Operating Activities

Cash from customers Rs 45,00,000

Cash to suppliers Rs-18,00,000

Cash for expenses Rs-15,00,000

Net Operating Cash Flow Rs 12,00,000

Investing Activities

Equipment purchased Rs -5,00,000

Net Investing Cash Flow Rs -5,00,000

Financing Activities

Loan received Rs 3,00,000

Loan repayment Rs -2,00,000

Net Financing Cash Flow Rs 1,00,000

Net Cash Increase Rs 8,00,000

Closing Cash Balance Rs 18,00,000

Investor focus:

● Positive operating cash flow

● Burn rate trend

● Cash runway calculation

Manual preparation: 4-5 hours (complex) With software: 30 seconds

Burn Rate & Runway Dashboard

What it shows:

Month Revenue Expenses Net Burn

October Rs 8L Rs 12L Rs -4L

November Rs 9L Rs 11L Rs -2L

December Rs 10L Rs 11L Rs -1L

Average Monthly Burn: Rs 2.33L

Current Cash: Rs 18L

Runway: 7.7 months

Critical for investors: When will you run out of money?

Manual calculation: 1-2 hours With software: Real-time dashboard

Unit Economics

For SaaS/Subscription Business:

Customer Acquisition Cost (CAC):

Total Marketing Spend: Rs 3,00,000

New Customers: 50

CAC = Rs 6,000 per customer

Lifetime Value (LTV):

Average Revenue Per Customer: Rs 2,000/month

Average Customer Lifetime: 24 months

LTV = Rs 48,000

LTV:CAC Ratio = 48,000/6,000 = 8x (Excellent)

For Product Business:

Product Price COGS Gross Margin

Product A Rs 100 Rs 40 60%

Product B Rs 200 Rs 120 40%

Product C Rs 500 Rs 250 50%

Investor focus: Healthy unit economics prove business model works

Manual calculation: 2-3 hours (needs data from multiple sources) With software (like hisabkitab): Built-in calculators, automatic

How to Generate Reports with hisabkitab

Setup (One-time, 10 minutes)

Configure your metrics:

Define your revenue categories

Set up expense categories properly

Tag transactions by product/project

Enable unit economics tracking

Set your fiscal year

Done. System maintains everything from now on.

Daily Operations (Automatic)

As you work normally:

● Create invoices → Revenue tracked

● Record expenses → Costs tracked

● Reconcile bank → Cash flow updated

● All statements update automatically

● Metrics calculate in real-time

No extra work needed

Generating Investor Reports (2 minutes)

When investor asks:

Step 1: Navigate to Reports

● Click "Reports" in menu

● See 50+ pre-built report templates

Step 2: Select Financial Statements

● P&L Statement

● Balance Sheet

● Cash Flow Statement

● Set date range: "Last 12 months"

Step 3: Export

● Click "Export to PDF"

● Professional formatted report ready

● Your branding included

● Charts and graphs auto-generated

Step 4: Generate Investor Package

● Click "Investor Report Package"

● Includes all standard reports

● Plus burn rate dashboard

● Plus unit economics

● Plus growth metrics

● One PDF with everything

Step 5: Email

● Send directly from platform

● Or download and send manually

Total time: 2 minutes

Custom Reports (5 minutes)

If investor wants specific analysis:

hisabkitab Custom Report Builder:

Select metrics to include

Choose date range

Add filters (by product, customer, region)

Add visualizations (charts/graphs)

Save template for future use

Export

Examples:

● Revenue by product line

● Expenses by department

● Customer acquisition by channel

● Regional performance comparison

Alternative Tools for Investor Reports

Excel (Manual)

Pros:

● Flexible

● Everyone has it

● Can customize anything

Cons:

● Extremely time-consuming (9-15 hours)

● Error-prone

● Gets outdated immediately

● Not scalable

Best for: Very early stage with minimal transactions

Tally + Excel

Process:

● Export from Tally

● Import to Excel

● Manually format and calculate

● Create charts

Time: 3-5 hours Best for: Traditional businesses with established Tally workflows

QuickBooks / Zoho Books

Pros:

● Good standard financial reports

● Cloud-based

● Export options

Cons:

● Limited unit economics tracking

● Basic dashboards

● Needs Excel for custom analysis

● Expensive for startups

Time: 30 minutes for basic reports, 2-3 hours for complete package

hisabkitab

Pros:

● Complete investor-ready reports built-in

● Unit economics calculator included

● Burn rate dashboard

● Custom report builder

● One-click export

● Real-time data

● Most affordable (Rs 2,999/year)

Cons:

● Newer platform (less brand recognition)

Time: 2 minutes for complete investor package

Best for: Startups and SMEs seeking investment

Report Quality Checklist

Before Sending to Investors

Accuracy:

● All bank accounts reconciled

● All invoices recorded

● All expenses captured

● No missing months

● Numbers add up correctly

Completeness:

● P&L for all months

● Current balance sheet

● Cash flow statement

● Burn rate calculation

● Key metrics included

Presentation:

● Professional formatting

● Company branding

● Clear labels and headers

● Charts for trends

● No errors or typos

Context:

● Executive summary

● Key highlights noted

● Unusual items explained

● Assumptions stated

● Contact info included

Best Practices

Maintain Clean Books Always

Don't wait for investor request:

● Record transactions daily

● Reconcile weekly

● Close month-end properly

● Always be report-ready

Use Consistent Categories

Chart of accounts:

● Standardize from day 1

● Revenue categories clear

● Expense categories detailed

● Don't use "Miscellaneous" excessively

Track the Right Metrics

Know what investors care about in your industry:

● SaaS: MRR, churn, CAC, LTV

● E-commerce: GMV, repeat rate, average order value

● Marketplace: Take rate, liquidity, retention

● Manufacturing: Gross margin, inventory turnover, capacity utilization

Configure your software to track these

Monthly Discipline

Set calendar reminder:

● 5th of every month: Close previous month

● Review all reports

● Check for anomalies

● Update forecasts

Create Templates

First time investor reporting:

● Note what they asked for

● Save as template

● Next time: One click

Common templates:

● Board meeting package

● Investor update

● Due diligence pack

● Monthly management report

Visual Presentation

Investors love charts:

● Revenue growth trend line

● Burn rate trend

● Customer acquisition curve

● Cash runway projection

Good software auto-generates these

Narrative Matters

Don't just send numbers:

● Add 1-page executive summary

● Highlight key achievements

● Explain unusual items

● State assumptions clearly

Example summary:

Q3 2024 Summary:

Revenue grew 35% QoQ to Rs 45L

Gross margin improved from 55% to 60%

Monthly burn reduced from Rs 8L to Rs 6L

Runway extended to 12 months

Launched Product B (Rs 5L revenue in first month)

One-time expense: Office setup (Rs 3L)

Common Mistakes to Avoid

Mixing Personal & Business

Problem: Personal expenses in business account confuse reports

Solution: Separate accounts always, pay yourself salary properly

Cash vs Accrual Confusion

Problem: Showing revenue when invoice sent, but cash not received

Investors want to see both:

● Accrual-based P&L (revenue earned)

● Cash-based cash flow (money received)

Good software shows both

Missing Months

Problem: "We don't have data for June because we forgot to record"

Investor reaction: Red flag on financial discipline

Solution: Never skip month-end closing

Inconsistent Formatting

Problem: Different format every month, hard to compare

Solution: Use software templates, consistent always

Outdated Data

Problem: Sending last month's reports when current month is half over

Solution: Generate fresh reports every time

No Explanation

Problem: Sudden revenue spike/drop with no context

Solution: Always add notes explaining unusual items

Real Founder Stories

Founder A: Traditional Approach

Setup: Excel-based accounting

Investor request: "Send financials by tomorrow"

Reality:

● Worked till 3 AM compiling data

● Found errors at midnight, had to redo

● Sent incomplete data

● Investor unimpressed by delay

● Follow-up questions took another 2 days

Outcome: Lost momentum in discussions

Founder B: hisabkitab User

Setup: hisabkitab from day 1

Investor request: "Send financials by tomorrow"

Reality:

● Generated complete package in 2 minutes

● Sent same evening

● Investor impressed by speed and professionalism

● No follow-up questions (everything was there)

● Term sheet discussion started next day

Outcome: Closed funding 2X faster

Conclusion

The modern fundraising reality:

● Investors expect instant access to financial data

● Clean, professional reports signal operational maturity

● Delayed or messy financials are red flags

● Speed matters in competitive funding situations

Two approaches:

Traditional (Manual):

● 15-20 hours per investor request

● High error risk

● Always stressful

● Limits fundraising capacity

Automated (hisabkitab):

● 2 minutes per investor request

● Accurate and professional

● Always confident

● Can handle multiple investor conversations

ROI is immediate:

● Time saved: 15-20 hours per request

● Professional impression: Priceless

● Faster funding close: Can be worth lakhs

● Software cost: Rs 2,999/year

The choice is obvious.

Get Investor-Ready Today

hisabkitab for startups:

● All standard financial statements

● Burn rate dashboard

● Unit economics calculator

● Custom report builder

● One-click investor packages

● Real-time dashboards

● Rs 2,999/year

7-day free trial:

● Full access to all reports

● Upload your data

● Generate actual investor reports

● See the difference

● No credit card required

Don't let poor financial reporting delay your funding. Get investor-ready in minutes, not days.

Your next investor meeting could be tomorrow. Are you ready?