Newco Studio Explorer

Start from

Sets the Operations and Deal terms tabs and the Bootstrap funding tab, for either operating model below. The other two funding tabs keep their own settings. Moving any other control switches to Custom.

Operating model

Studios bought each year

Mix of studio sizes bought

Small 2 rooms

Medium 3 rooms

Large 4 rooms

Class hours used, at target80%

60%70%80%90%100%

Share of room hours with a class running (34 hours a week per room).

When bought

Sets the purchase price. Studios start here and rise to the target.

Years to reach target

0 = at target from the year bought. Kids per class rises over the same years.

Kids per class

When bought

At target

Teaching cost follows classes, not kids, so fuller classes go almost straight to profit. 12 is the ceiling.

Tuition increase

Starting in

Central back office

Bookkeeping, CPA, legal, office and brand. Mid is halfway between full and lean. Grows more slowly than the number of studios.

More settings Head office timing, Laylas back office, assistant teacher

Regional directors start at

Clusters model: one $75K director per 3 studios once Newco owns this many.

Interim cover per director, before then

For example, the seller staying on part-time as cluster lead.

Regional managers start at

One studio at a time: one regional manager per 6 studios once Newco owns this many.

Regional manager cost

One studio at a time: loaded cost per regional manager. $0 = no regional manager.

Interim cover per regional manager, before then

Back office until Newco has its own

Laylas fee

Newco's own back office starts at

The $50K setup per 3 studios is paid when Newco's own back office starts.

Assistant teacher when classes average above

0 = off. When on, every class carries an assistant at the pay below.

Assistant pay per class hour

Year 6 revenue

Year 6 EBITDA

Run-rate EBITDA

This scenarioBase case (6 studios a year, all 2-room, 80%, full back office)

Six-year summary, $K per year

Studios bought each year	Y1	Y2	Y3	Y4	Y5	Y6	Run-rate

See the costs

One studio, per yearShow / hide

Per studio, per year	$

Click a group to see its lines. Synergies shown fully phased in. Central back office is each studio's share at the Year 6 size.

Purchase price, as a multiple of revenue

Small

Medium

Large

How each studio purchase is paid for

Seller note

Share of the purchase price the seller lends back. If the bank is an SBA lender, its rules limit payments on these notes.

Seller note rate

Seller note term

Interest-only years

Earnout

Share of the price paid a year after closing, tied to keeping students.

Share of earnout paid

Refresh paid in year 2

Share of the $25K refresh and rebrand paid from cash the season after buying.

Purchase price

All-in cost

Price, deal costs, refresh, working capital, deposit, setup

Cash needed at closing

Before bank debt

One studio purchase, average studio in the mix

Per studio	$

Share financed with debt

Of the cash needed to buy and open each studio. The rest is equity.

Interest rate

Loan term

Mike's cash

Share of the owners' cash, incl. down payments, setup, shortfalls.

Equity partner funds

Partner's share of the owners' cash. Mike's cash and the partner's always add to 100%; the bank's share is set above.

Ownership given to the partner

Partner's share of cash paid out and of value at exit.

Exit multiple (on Year 6 EBITDA)

Year 6 cash after debt

Business, per year

Debt coverage, Year 6

Mike's net gain

Over six years, incl. exit

At the end of Year 6	$	IRR	Multiple

IRR uses each year's cash in and out, with the sale at the end of Year 6; cash in and out in the same year are treated as happening at the same time. Multiple = cash back (including the sale) ÷ cash put in.

Cash after debt, $K per year

Studios bought each year	Y1	Y2	Y3	Y4	Y5	Y6

Equity raised

Committed up front, drawn as needed.

Mike's cash, part of the raise

The investor funds the rest. Both put in the same share of each draw.

Debt share, early years

While proving the model.

Years at the early debt share

Debt share, later years

Once studios have a track record.

Interest rate

Loan term

Mike's ownership

His share of cash paid out and of value at exit. The investor gets the rest. No preferred return yet.

Exit multiple (on Year 6 EBITDA)

Equity used

Investor IRR

Mike's IRR

At the end of Year 6	$	IRR	Multiple

Funding each year, $K

Studios bought each year	Y1	Y2	Y3	Y4	Y5	Y6

Uses the Operations and Deal terms settings. Cash the studios earn after loan payments goes into buying the next studios; the raise covers the rest. Each year's studios keep the debt share they were bought at. IRR treats cash in and out in the same year as happening at the same time; money left at the end of Year 6 is paid out. Multiple = cash back ÷ cash put in.

Mike's cash put in, $K

Planned cash. Any further shortfall below the minimum cash is a top-up from Mike, shown in the table.

Bank debt per studio

Debt share (cap)

Of the cash needed at closing, after the seller note and earnout.

Interest rate

Loan term

Minimum cash to hold

Outside equity round in

0 = no round; Mike covers every shortfall.

Round size

0 = enough to keep cash at the minimum through Year 6.

Round priced at (EBITDA multiple)

Applied to EBITDA in the round year, less net debt. Far left = by revenue size (Inputs tiers).

Exit multiple (on Year 6 EBITDA)

Far left = by revenue size (Inputs tiers).

Mike's cash in

Mike's IRR

Investor IRR

At the end of Year 6	$	IRR	Multiple

Funding each year, $K

Studios bought each year	Y1	Y2	Y3	Y4	Y5	Y6

Uses the Operations and Deal terms settings. Studios are bought before the season and pay a full year of loan payments in the year bought. Cash the studios earn stays in the business and funds the next studios; it is paid out at the end of Year 6. The outside investor's share is set by the round's price, not chosen.