Before you open a single spreadsheet: Build your first sales forecast in Excel

How to Create Your First Sales Forecast in Excel for Startups

For an early-stage founder, the sales pipeline can feel like a collection of scattered notes, hopeful emails, and conversations in your head. When an investor asks, “How much revenue will we book next quarter?” the pressure is on to produce a number. Without a dedicated finance team or an expensive CRM, that number often feels like a guess.

The challenge is not just the calculation. It is converting messy, real-world sales activities into a structured Excel model that can reliably inform your cash runway and funding decisions, especially when you have little to no historical data to lean on. This guide provides a practical, step-by-step process to build a simple revenue projection from the ground up, moving from paper-based planning to a functional, decision-driving tool.

Part 1: Define Your Sales Process Before You Open Excel

Before you open a single spreadsheet, the most critical step is to map out your sales process. A common mistake is adopting generic sales stages that do not reflect how your customers actually buy. The goal is to define stages based on tangible, observable milestones. Ask yourself: what specific actions must occur for a deal to move forward? This is not about theory; it is about documenting the real steps in your sales motion.

The reality for most early stage startups is more pragmatic: you need 4 to 6 clear stages that represent a real change in the deal's momentum. For example, a B2B SaaS company might use stages like these:

• Stage 1: Initial Qualification Call: A discovery call has been completed, and there is a mutual understanding of the problem and potential fit.
• Stage 2: Demo Completed: The prospect has seen the product in action and has confirmed it addresses their core needs.
• Stage 3: Technical Validation: The prospect's technical team is evaluating the solution or engaging in a trial.
• Stage 4: Proposal Sent: A formal quote with pricing and terms has been delivered to the decision-maker.
• Stage 5: Verbal Commitment: The prospect has indicated they intend to purchase, and procurement or legal review is underway.

For a professional services firm, the stages might look different, focusing on client commitment: Discovery Meeting, Scoping Workshop, Proposal Submitted, and Contract Sent. By defining these milestones first, you create the logical framework that will underpin your entire DIY sales forecast.

Part 2: Build Your Startup Sales Tracking Spreadsheet

Now you can translate your defined process into a structured Excel table. This startup sales tracking spreadsheet will become the single source of truth for your pipeline. Create a new sheet and set up six essential columns. This structure is the foundation of your excel sales pipeline template. For collaboration, store the file on OneDrive or SharePoint for co-authoring.

1. Deal Name: A clear identifier for the opportunity (e.g., “Company ABC - Platform License”).
2. Potential Value: The total contract value if you win the deal.
3. Current Stage: A dropdown menu using the stages you defined in Part 1.
4. Est. Close Date: The date you realistically expect the deal to close.
5. Win Probability (%): The likelihood of winning the deal, based on its current stage.
6. Weighted Value: A calculated field (Potential Value * Win Probability).

Here is how to handle the most difficult column when forecasting sales with no history: Win Probability. Without past data, you must rely on directionally correct 'educated guesses'. The key is to be consistent and conservative. Assign a percentage to each stage you defined. For instance:

• Initial Qualification Call: 10%
• Demo Completed: 25%
• Technical Validation: 50%
• Proposal Sent: 75%
• Verbal Commitment: 90%

These numbers are not perfect, but they establish a baseline you can and should adjust as you gather more data. What founders find actually works is starting with conservative estimates and refining them quarterly. The goal is not perfect prediction, but creating a logical framework to reduce uncertainty.

Part 3: How to Calculate Your Sales Forecast in Excel

With your pipeline data neatly organized, calculating your forecast is a straightforward process. The core metric you will use is the “Weighted Value” we created in the previous step. This figure represents the risk-adjusted value of each deal, one of the most important early stage sales metrics.

In your Excel table, the formula for the 'Weighted Value' column is simple: =B2*E2 (assuming Potential Value is in column B and Win Probability is in column E). Drag this formula down for all your deals. The sum of this column gives you the total value of your weighted pipeline.

However, a single total is not enough for sales forecasting for beginners. You need to see expected revenue by month. This is where Excel’s PivotTable feature becomes invaluable. A PivotTable allows you to summarize your structured data automatically.

To create your monthly forecast:

1. Select your entire data table.
2. Go to the 'Insert' tab and click 'PivotTable'.
3. In the PivotTable Fields pane, drag 'Est. Close Date' into the 'Rows' area. Excel will often automatically group the dates by month.
4. Drag 'Weighted Value' into the 'Values' area. Ensure it is set to 'Sum of Weighted Value'.

Instantly, you will have a clean summary of your forecasted bookings for the coming months. This is your baseline sales forecast, rolled up directly from your deal-by-deal assumptions. It transforms your list of deals into a powerful tool for financial planning.

Part 4: Using Your Forecast for Strategic Decisions

A sales forecast is not an academic exercise. Its primary purpose is to help you make better decisions about hiring, spending, and fundraising. Aligning this forecast with your cash runway and investor updates is where the model proves its worth.

First, it is vital to understand the difference between 'booked revenue' and 'cash in the bank'. Your forecast shows when you expect to book a deal, meaning when a contract is signed. It does not show when the cash will arrive. For a SaaS startup, a $120,000 annual contract might be booked in January, but the cash may arrive in $10,000 monthly installments. You must layer your payment terms on top of this forecast to create a true cash flow projection.

Second, never present a single forecast number to your board. A scenario we repeatedly see is founders presenting an optimistic case as a guarantee, which erodes trust when reality falls short. A better approach is presenting credible scenarios. Use your model to create a 'Base Case' (your most realistic estimate) and an 'Optimistic Case'. This demonstrates you understand the risks and variables in your business and shifts the conversation from “Did you hit the number?” to “What needs to be true for us to hit the optimistic case?” This is far more strategic when discussing funding needs.

From an Excel Model to a Predictable Revenue Machine

Creating your first sales forecast in Excel does not require a finance degree or expensive software. It requires a disciplined approach to defining your process, structuring your data, and using simple tools to derive insights. For any founder, this DIY sales forecast is a fundamental tool for managing the business and answering critical questions about your financial health.

Your initial assumptions will be inexact. That is okay. The goal of this exercise is not to build a perfect crystal ball, but a tool for decision-making. By consistently tracking your deals in this structured format, you will naturally refine your assumptions. Your forecast will become more accurate over time, providing a clearer view of your trajectory. This simple spreadsheet moves you from reacting to your bank balance to proactively managing your revenue engine, which is the first step toward building a predictable revenue machine and having more confident conversations with investors.

Frequently Asked Questions

Q: How often should I update this sales forecast?
A: For an early-stage startup, your sales forecast is a living document. You should review and update it weekly as deals progress through your pipeline. A more formal, in-depth review should happen monthly to check your assumptions, refine win probabilities, and align the forecast with your financial planning.

Q: What is the biggest mistake founders make when forecasting sales without CRM?
A: The most common mistake is using generic sales stages that do not reflect how your customers actually buy. This leads to inaccurate win probabilities and an unreliable forecast. Before building your model, define 4 to 6 stages based on tangible, observable milestones that signal real deal momentum.

Q: Is this DIY sales forecast good enough for fundraising?
A: Absolutely. Investors in early-stage companies know you will not have perfect historical data. They want to see a logical, bottoms-up model that shows you understand your sales process. Presenting a 'Base Case' and 'Optimistic Case' from this model demonstrates strategic thinking and builds credibility.