Jeff Cornwall who I do respect writes in his article Short-cut to Trouble. It is about the importance of revenue forecasting. (Via Ken )

Accurate revenue forecasting is one of the single most important steps an entrepreneur takes in planning for a new venture. And yet, we find that most entrepreneurs do not spend enough time determining how much revenue will come in their front doors. Although underestimating expenses is a common mistake in business planning, missing the mark on revenues can be catastrophic.

The article makes the classic mistake of thinking all start-ups follow the same industrial kind of model with VC’s and business plans etc. I think it is not at all relevant to web based start-ups. Where this is probably relevant are the kind of start-ups where you do need a huge upfront investment.

As all internet start-ups and sooner or later realize these revenue forecasts that you do are nothing more than a waste of time. See for example Guy Kawasaki’s Art of Business Plans :

7. Provide a one-page financial projection plus key metrics. Many business plans contain five year projections with a $100 million top line and such minute levels of detail that the budget for pencils is a line item. Everyone knows that you’re pulling numbers out of the air that you think are large enough to be interesting, but not so large as to render urine drug-testing unnecessary. Do everyone a favor: Reduce your Excel hallucinations to one page and provide a forecast of the key metrics of your business—for example, the number of paying customers. These key metrics provide insight into your assumptions. For example, if you’re assuming that you’ll get twenty percent of the Fortune 500 to buy your product in the first year, I would suggest checking into a rehab program.

What you do need to do is understand is a financial version of your business model and explain it such a way that it becomes an instinctive in your head dynamic spreadsheet for you (and any team you might have).

How does this work? Well keep it as simple as this. I sell subscriptions for $10pm. My monthly expenses are $2000. Ergo I need 200 subscriptions. When you have some real historical data and a good understanding of the real market, you can finally do revenue projections. But until then focus on the magical amount of monthly sales you need to break even. This magic number should be a mantra to you. Once you reach this point you have a much better chance of catching a VC butterfly as well.

I have written about this before as my Bootstrapping Anti Pattern #3 – Focusing on an imaginary 3 year revenue goal .

I use the EasySpeedy for my hosting. They already provide the most transparent hosting plans and hosting contract I have seen, but they continue to impress me. I’ve got 2 servers there and will put my 3rd one there if need be.

Apparently one of their clients where spamming with spoofed IP addresses from other users on their network. This is obviously a big problem as no one wants to get black listed.

From the beginning they have been incredibly open about it and gone that extra yard in uncovering the spamming vendor of Viagra and Penis enlargers.

I am not 100% sure if he used one of my ip addresses. I haven’t got mail servers on any of my servers. Both of do do outgoing mail though via ActionMailer in Rails.

Now what they did is send out a fantastic email that I will share with you below:

While I am using Wide Word for almost all my writing needs these days, there are times when I need to generate fancy print or pdf documents. I have been using NeoOffice which while powerful is heavy and still has a non mac like user interface.

So when ole Steve announced iWork ’06 I thought cool. The price tag fits with my cheap ass bootstrapping goals and it looks like it would provide slick documents, thus saving either my design time or paying someone.

The few reviews I saw of iWork ’06 all focused on Keynote, but I was more interested in Pages. Therefore I decided it best to write a quick little first impressions of Pages 2. So read on for more…

Guy Kawasaki has one of his always great lists: The art of Bootstrapping, like many of his recent posts this is a summary of some of his advice in his excellent book “The Art of the Start”.

Also remember to (re)read my Bootstrapping AntiPatterns for advice on what Not todo as a bootstrapper. They complement Guy’s list nicely.

I don’t know if I should laugh or cry, but it is just typical really of why there are so few large successfull web based services in Europe.

The project, called Quaero, found itself in the spotlight following remarks last week by French President Jacques Chirac in a speech laying out his agenda for France in 2006. “We must take up the challenge posed by the American giants Google and Yahoo,” Chirac said, discussing the importance of technology to Europe’s economy. “For that, we will launch a European search engine, Quaero.” [Computer world ]

Chirac and friends are busy trying to kill the entrepreneurial spirit of places like the UK and Estonia by imposing more ridiculous regulations on them that the US doesn’t have and at the same time he is off trying to build a competitor to his great enemy the US.

I have news for you Chirac, neither Google nor Yahoo were funded or invented by Bush or Clinton (Maybe Gore had a hand in there somewhere?). They were founded by geeks with easy access to capital in an environment that encourages experimentation. They where able to encourage the best people of the world to join them.

Europe is infested in government and EU run entreprise generation schemes. In the 20 or so years I have followed them, very few of them have produced any thing like the entrepreneurialism of Silicon Valley.

Skype is one of the examples of successful European internet companies, and they most certainly would never have been funded by some hair brained government scheme. They succeeded inspite of the European governments in part by using the strategies that Chirac and the OECD claim are unfair.

These guys will never learn. The Danish government also seem to think along the same lines. To be fair you see this kind of thing many places. But it’s typical of Chirac to try to do this with such bravado.

And while it may be a great place to work France’s Silicon Valley is not and will never be Silicon Valley for very obvious reasons. It is a techno park for large established companies nothing more nothing less. It would probably be an ideal place for a new Google or Yahoo campus, but for people starting up in their garage or dorm room? Give me a break.