Asteria is an application for modelling cashflows and balances. It uses a modular approach, making it very easy to look at variations and scenarios.
This flavour of Asteria models a simple software startup, and shows how Asteria can be used for a stochastic model. Another flavour models a defined benefit retirement scheme. It shows how Asteria can be used to construct a deterministic model of reasonably complex cash flows. Both flavours illustrate Asteria's flexibility and interactive visualisation of results.
To get started, go to the Results section of the site to see the Model Runners that have already been defined. You can use an existing one as it is, modify it or create a new one. Click on its run button to see its results, on its edit button to edit it, or on the add button to create a new one.
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This flavour of Asteria shows one way of modelling a small startup company. It sells software that has to be customised before use (rather than shrink-wrapped products), so there is a possibly protracted period of sales activity for each customer, during which some costs are incurred. Once the customer has agreed to buy, the customisation is performed, resulting in further costs at that stage and for a few months afterwards, as the final tweaks are made.
The company starts out with a cash balance. It incurs regular monthly costs that are independent of its sales activities, and also earns interest on its cash balance each month. If it goes overdrawn, it pays interest on its overdraft.
Prospective customers arrive randomly. Each prospective customer has a probability of ending up buying from the company. If it does buy, it will do so a random number of months after first being in contact. The price it pays is also random. It actually pays for its purchase only some months after signing the contract.
The company incurs a standard monthly cost for each prospective customer it is in contact with. It only does so for a certain number of months before deciding to abandon sales activity to that customer.
When a sale is agreed, the company incurs a cost that is related to the purchase price. For some months afterwards, it incurs a further maintenance cost that is also related to the purchase price. After all activity has ceased, it loses contact with the customer.
Asteria models the company stochastically — the parameters specify the probabilities of various events occurring, such as a customer committing to a purchase. It uses Monte Carlo modelling: it runs up to 500 simulations, and calculates summary statistics such as percentiles and averages.
It also shows individual simulations.
The Asteria model is driven by parameters, which you use to define the characteristics of the company, its cost structure, and of its customers.
The company is represented by a Company parameter block, which specifies the initial cash balance, the rate of interest earned on its cash balance, the rate of interest paid on any overdraft, and the number of months for which the company is in contact with prospective customers.
The company is represented by a Company parameter block. Each Company must have a Name, so that the Model runner knows which one to use.
The Company starts out with an Initial cash amount. Its cash balance (which depends on the sales and costs) earns interest at the specified annual Interest rate. If the cash balance is negative, the company pays interest at the specified annual Overdraft rate. These interest rates are specified as proportions, so you should enter .01 for an annual interest rate of 1%.
The Company incurs monthly Standing costs which are independent of the level of sales or customers.
If the Company has a cash balance at the beginning of the month that is greater than the Dividend trigger amount, it will pay a dividend of Dividend proportion of the excess of the actual balance over the trigger. This can be used to represent a dividend payment to the shareholders, salaries to the directors or founders, repayment of directors' loans, or other similar payments.
Interest is paid monthly. Costs are paid half way through the month.
The costs incurred by the company are represented by a Cost package parameter block, which specifies the costs that are incurred for each customer.
Possible structures for the costs incurred by the Company that are related to customers are defined by Cost package parameter blocks. Each Cost package must have a Name, so that the Model runner parameter block knows which one to use.
For each prospective customer, the company incurs a monthly cost of Prospect cost amount for Prospect cost months or until the customer makes a purchase, whichever is sooner. This cost is paid half way through the month.
When a customer makes a purchase, the company incurs a cost which is an average of the Mean buy cost proportion of the sale value. This cost is paid at the beginning of the month.
After a customer has made a purchase, the company incurs a monthly cost which is an average of the Mean maintenance cost proportion of the sale value. This cost is paid half way through the month for Maintenance cost months.
The types of customers that the company deals with are described by Customer parameter blocks.
The types of customers buying from the Company are defined by Customer parameter blocks. Each Customer must have a Name, so that the Model runner parameter block knows which one to use.
Each prospective customer has the same Probability of buying.
If a customer does buy from the company, the time at which they do so is specified by the Mean months before buying and the standard deviation (sd) of months before buying — a measure of the variability. The revenue to the company is specified by the Mean sale value and the standard deviation of the sale value, subject to a Minimum sale value. Finally, the customer waits some Months before paying after the sale is agreed until it actually pays the company.
It is assumed that the purchase price is paid half way through the month.
The company's mix of customers is described by Customer mix parameter blocks.
The customer mix of a company is specified by a Customer mix parameter block, which links Customers with the number of prospective customers of that type. Each Customer mix must have a Name, so that the Model runner knows which one to use.
A Customer mix consists of one or more pairs of a Customer and Average number per month, describing how many new prospective customers of that type there are each month, on average.
A Model runner parameter block ties all the other parameters together.
A Model runner parameter block ties all the other parameters together. It also specifies parameters that affects the model as a whole.
The following must be specified:
An Asteria cash flow model is an ideal way to give your clients a tool that they can use to explore different scenarios.
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