Introduction to Technical Analysis

What is technical analysis? Technical and Fundamental Analysis are the two most common ways of performing research on any trading vehicle (incl. stocks, commodities, currencies, ETFs). Traders use these tools to evaluate investments and spot trends, which indicate good opportunities for trading. Fundamental analysis tries to weigh all the information in a given market (such as company financials, the general economic environment, global and domestic, competitors, how the interest rates are moving, and others). On the other hand, technical analysis Read more…

Your Customer Satisfaction (CSAT) Score Can Make or Break Your Business

We all know happy customers come back to do more business with our company. They also provide priceless word-of-mouth marketing by sharing their experience with others. Clients who rate our products and services as highly satisfactory are usually the ones that promote us to their colleagues, friends, and family. This improves both our conversion rates and profitability margins. To fully grasp the importance of Customer Satisfaction, we need to understand that keeping an existing client happy usually costs much less Read more…

Customer Lifetime Value (CLV) – an Essential Business Metric

When we are trying to optimize the experience for our customers, there are many metrics we can track and aim to improve. The Customer Lifetime Value (CLV) shows us how much money a customer will bring to the business on average over the entire time they remain a paying client. Whether we decide to refer to the metric as CLTV, LTV, or the most popular CLV, it helps us calculate the overall value a customer has to the business, showing Read more…

Customer Churn Analysis in Excel

Customer Churn is one of the most essential metrics for any company with a subscription-based model. It shows the rate at which customers are leaving and switching their subscriptions to someone else. It’s paramount to understand and analyze churn, as even a slight increase in the churn rate can have devastating effects on our business. Customer Churn Rate We can also refer to Customer Churn as ‘customer attrition rate.’ Churn is very costly for the business. It results in the Read more…

Understanding Customer Acquisition Cost (CAC)

One of the reasons businesses fail is a wrong estimate of how much it will cost to acquire customers. If the cost ends up too high and exceeds the monetization of the customers, the business cannot operate sustainably. It is essential to understand how much a customer will generate for the business, as knowing this will let us figure out our acceptable level of CAC per customer. Companies that do not fully understand their CAC can quickly end up failing. Read more…

EBITDA Multiple for Business Valuation

The EBITDA Multiple is the most common method venture capitalists, and financial analysts use to value businesses as investment opportunities. If we plan to acquire a company or sell our own, EBITDA can be a great starting point for measuring the potential value in a sale. When we enter negotiations to sell or purchase a business, it’s common to perform a due diligence process. The acquiring party will aim to reason a lower valuation by adjusting EBITDA down. On the Read more…

Create a Folder Structure with VBA

In my current job in Mergers & Acquisitions, I have to prepare many complex folder structures for targets’ data rooms. It’s a tedious but straightforward process that can take up to an hour, as each Request For Information letter is almost the same but contains slight differences. For example, we may need detailed information of the shareholder structure and various related documents for a specific company we are looking to acquire. On the other hand, for a smaller, one-person organization, Read more…

What are Employee Stock Options (ESOs)?

More and more companies are offering stock options as part of the compensation package when recruiting new talent. Employee Stock Options are a type of equity compensation that companies can grant to their employees. Instead of giving the stock directly, the company awards derivative options on the stock. These are regular call options that give the employee the right to buy company stock at a set price for a specified period. The Employee Stock Options terms can either be a Read more…

Introduction to Game Theory in Finance

Game Theory is a method of modeling the interaction between two or more players in a situation with particular rules and expected outcomes. It is helpful in many fields, but mainly as a tool in economics. Game Theory helps with the fundamental analysis of industries and the interactions between two or more companies. Theoretically, games can have an infinite number of players, but we usually look at them in the context of two players. A simple example is a two-player Read more…

First In, First Out (FIFO) Inventory Costing

The First In First Out (FIFO) is a method for asset management that ensures assets we produce or acquire first are the ones we use or sell first. Under FIFO, we include the oldest assets’ cost in the Cost of Goods Sold (COGS) line item on the Income Statement. How does FIFO work? FIFO supports our assumptions for the cost flow within the company. When we use parts and raw materials in the production process and then sell the finished Read more…