An Austin DTC pet accessories brand generating $2.8M wanted to launch a supplement line and raise $1.2M. Our 5-year model showed supplements would outperform accessories by year 3.
01The Situation
The founder had built a profitable DTC pet accessories business over six years. She identified a clear white space in premium pet supplements, 62% gross margin versus 28% for accessories. She needed $1.2M to fund the launch, and investors wanted a 5-year model showing how the supplement line would grow relative to the existing business.
She had good product instincts and a loyal customer base. What she did not have was a financial model that could tell the story of both businesses together.
02What We Did
We modeled accessories on its historical trajectory, steady 14% annual growth. The supplement model was built from the customer data up: existing email list as seed audience, repurchase rate assumptions from comparable supplement categories, and a digital advertising model showing CAC at different spend levels.
The model showed supplement revenue exceeding accessories by year 3. Blended gross margin improving from 34% to 42%. At year 5: $10.2M revenue and 46% gross margin. The $1.2M raise closed within eight weeks.
03Client Impact
The model got the raise done and made the founder take the supplement launch seriously as a business in its own right, with its own metrics. Thinking about the two businesses separately, then together, changed how she allocates resources.
This result came from our cash flow forecasting for ecommerce brands. See more client results.
Breakdown
| Year | Accessories Rev. | Supplement Rev. | Total Revenue | Blended Margin | Net Income |
|---|---|---|---|---|---|
| Year 1 | $2.8M | $420K | $3.22M | 34% | $386K |
| Year 2 | $3.2M | $1.26M | $4.46M | 38% | $624K |
| Year 3 | $3.6M | $2.84M | $6.44M | 42% | $966K |
| Year 4 | $4.0M | $4.20M | $8.20M | 44% | $1.37M |
| Year 5 | $4.4M | $5.80M | $10.20M | 46% | $2.04M |
What changed
5-Year Dual-Business Model Built
Accessories on historical trajectory. Supplements modeled from customer data, repurchase rates, digital CAC.
$1.2M Capital Raise Completed
Closed within 8 weeks. Investors cited detailed supplement growth assumptions as key confidence factor.
Supplements Confirmed as Primary Opportunity
Year 3 supplement revenue exceeds accessories. Blended margin improves 8 points.
Now Used as Operating Plan
Founder tracks actuals vs forecast monthly. Currently running 12% ahead of base case.
The model got the raise done and made the founder take the supplement launch seriously as a business in its own right, with its own metrics. Thinking about the two businesses separately, then together, changed how she allocates resources.
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