2nd Hanger

FINANCIAL MODEL v5 (FINAL) — FEBRUARY 2026 — PRE-SEED ROUND — CONFIDENTIAL

₹50L RAISE12% EQUITY31 SECTIONS

Changelog

What Changed from v4. Supplier-Verified Updates.

SECTION 00

Item	v4	v5	Reason
Machine cost	₹4L	₹4.6L	Supplier-verified, Murahari at factory in Coimbatore
Hub 1 CAPEX	₹10L	₹10.6L	Updated machine cost flows through
Hub 2/3 CAPEX	₹8.3L each	₹8.9L each	Same machine cost update
Damage reserve	Not included	₹5,000/month	New line item added to hub OPEX
Hub OPEX	₹76,500	₹81,500	Damage reserve + cost adjustments
Hub fixed costs	₹59,000	₹64,000	Damage reserve classified as fixed
Variable cost/piece	₹1.30	₹1.35	₹17,500 / ~13,000 pieces
Contribution margin	₹11.85 (90.1%)	₹11.80 (89.7%)	₹13.15 - ₹1.35
Hub breakeven	192 pcs/day	209 pcs/day	₹64,000 / ₹11.80 / 26 days
Company breakeven	375 pcs/day	393 pcs/day	₹120,500 / ₹11.80 / 26 days
Ask	₹45L for 12%	₹50L for 12%	Higher CAPEX + speed reserve
Post-money valuation	₹3.75 Cr	₹4.17 Cr	₹50L / 12% = ₹4.17 Cr
Technology	External dev team	Hitroo (Rohit's own studio)	CEO = CTO, tech cost near zero
Company overhead	Previous structure	₹56,500/month	Rohit ₹20K + Murahari ₹15K + Vibhav ₹15K + Admin ₹6.5K

The Ask

Raising ₹50,00,000. 12% Equity.

SECTION 01

₹50LRAISING

12%EQUITY OFFERED

₹4.17 CrPOST-MONEY VALUATION

POST-MONEY VALUATIONInvestment / Equity % = ₹50,00,000 / 0.12= ₹4,16,66,667 (~₹4.17 Crore)

PRE-MONEY VALUATIONPost-Money - Investment = ₹4,16,66,667 - ₹50,00,000= ₹3,66,66,667 (~₹3.67 Crore)

DILUTION FACTOR100% - New Equity = 100% - 12%= 88% (all existing shareholders multiplied by 0.88)

Founding Team & Equity

Three Founders. Skin in the Game.

SECTION 02

Founder	Role	Pre-Investment Equity	Monthly Salary	Notes
Rohit	CEO, Strategy, Tech, Finance	50%	₹20,000	Also CTO. Builds app via Hitroo (own dev studio). Handles investor relations, finances, product decisions.
Murahari	Operations	25%	₹15,000	At hub daily. Currently at factory in Coimbatore evaluating machine specs. Quality control, vendor management.
Vibhav	Marketing & Growth	25%	₹15,000	Door-to-door customer acquisition. PG partnerships. Field marketing. Referral program management.

POST-DILUTION: ROHIT50% x (1 - 12%) = 50% x 0.88= 44.0%

POST-DILUTION: MURAHARI25% x (1 - 12%) = 25% x 0.88= 22.0%

POST-DILUTION: VIBHAV25% x (1 - 12%) = 25% x 0.88= 22.0%

Post Pre-Seed Cap TableRohit 44% | Murahari 22% | Vibhav 22% | Investor 12% | Total 100%

Technology

The Hitroo Advantage. 95% Cost Savings on Tech.

SECTION 03

What is HitrooHitroo is Rohit's own development studio. Rohit is the developer. Small team of interns combined with AI-assisted development. This means zero external tech dependency — no agency invoices, no ₹1-2L/month developer costs.

Zero External Tech CostNo agency invoices. No ₹1-2L/month developer costs. CEO is the CTO. Full ownership of codebase.

₹3,000/month Total Tech BudgetServers + hosting + SMS credits + payment gateway. That is the entire technology budget at pre-seed stage.

Ship Same NightIf the app needs a feature tomorrow, Rohit builds it that night. Full control over product roadmap and execution speed.

AI-Leveraged Development1 developer with AI tools produces the output of a 3-4 person team. At pre-seed with 200 customers, app needs three capabilities: take orders, track delivery, process payment.

OUR ANNUAL TECH COST₹3,000/month x 12 months= ₹36,000/year

TYPICAL STARTUP TECH COST₹1.5L/month x 12 months (conservative)= ₹15-20,00,000/year

COST ADVANTAGE(₹18,00,000 - ₹36,000) / ₹18,00,000 x 100= 98% cost savings on technology

Kotlin Frontend

Express.js Backend

Built by Rohit via Hitroo

Seed Stage Plan (15-30 hubs)Hire 1-2 developers INTO the existing codebase Rohit built. Onboarding is fast because the CEO knows every line of code. No knowledge transfer delays, no documentation gaps.

Pricing Structure

Multi-Tier Pricing. ₹13.15 Blended Rate.

SECTION 04

Tier	Price	Mix %	Calculation	Contribution to Blend
Standard	₹11/piece	75%	₹11 x 0.75	₹8.25
Delicate	₹18-20/piece	10%	₹19 x 0.10	₹1.90
Saree/Suit	₹30/piece	8%	₹30 x 0.08	₹2.40
Aroma Add-on	+₹3/piece	20% of all	₹3 x 0.20	₹0.60
BLENDED RATE = Sum of all contributions				₹13.15

BLENDED RATE FORMULASum(Price x Mix%) = ₹8.25 + ₹1.90 + ₹2.40 + ₹0.60= ₹13.15 per piece

Blended Rate Evolution Over Time

Month	Blended Rate	Why
M1	₹12.00	Mostly standard pieces, new customers, conservative mix
M3	₹12.75	Delicate and saree orders start increasing
M5	₹13.15	Full mix achieved, aroma adoption growing
M7+	₹13.50	Higher aroma uptake, more premium garments
M10+ (Mature)	₹14.00	Mature customer base ordering more premium items

Hub-Level OPEX

₹81,500/month. 17 Line Items. Every Rupee Accounted.

SECTION 05

#	Expense	Amount	Type	Notes & Source
1	Store Rent (300-400 sq ft)	₹10,000	Fixed	Interior road, dark hub, no walk-in traffic needed. No main road premium.
2	Operator 1	₹12,000	Fixed	Machine operator, trained semi-skilled. Runs the steam press.
3	Operator 2 (from Day 1)	₹12,000	Fixed	Folds, quality checks, sorts garments. Required for 150 pcs/hr throughput.
4	Van Driver	₹12,000	Fixed	Pickup and delivery runs. Tata Ace, 40-50 km/day routes.
5	Staff Benefits/Insurance	₹2,000	Fixed	Festival bonus amortised monthly + accident insurance for all staff.
6	Electricity	₹6,000	Semi-var	Machine 3kW x 6hrs = 18 units x ₹7.5/unit = ₹4,500 + store lighting/fans ₹1,500.
7	Van Fuel	₹7,000	Variable	Tata Ace diesel. 40-50 km/day x 26 days. ₹87/L diesel, ~6 km/L.
8	Van Maintenance + Insurance	₹3,000	Fixed avg	Servicing ₹2,000/month avg + Insurance ₹1,000/month amortised.
9	Water	₹1,500	Variable	Steam machine consumes 30-60 litres/day depending on volume.
10	Aroma Supplies	₹1,000	Variable	6-7 bottles/month at ₹150 each. Applied to 20% of orders.
11	Packaging & Consumables	₹3,000	Variable	Garment covers, bags, hangers, tags. Scales with volume.
12	Machine Consumables	₹1,000	Variable	Press pad replacement, descaling solution, lubricating oil.
13	Phone/Internet/CCTV	₹1,500	Fixed	Broadband ₹600 + phone recharge ₹400 + CCTV subscription ₹500.
14	Marketing Materials	₹1,500	Semi-var	Pamphlets printing, referral reward payouts, society board fees.
15	Office Maintenance	₹2,000	Fixed	Cleaning, minor repairs, pest control, miscellaneous upkeep.
16	Damage Compensation Reserve	₹5,000	Fixed	NEW in v5. 0.1% damage rate, ~13 pcs/month at 500/day, avg ₹300/pc compensation.
17	Misc/Contingency	₹1,000	Buffer	Unforeseen expenses buffer.
	HUB TOTAL	₹81,500

Damage Reserve Mathematics

STEAM PRESS DAMAGE RATEIndustry benchmark: 0.1% (vs dhobi coal iron 2-5%)Steam press is 20-50x safer than traditional ironing

MONTHLY PIECES AT SCALE500 pcs/day x 26 working days= 13,000 pieces/month

DAMAGED PIECES PER MONTH0.1% x 13,000 pieces= 13 damaged pieces/month

COMPENSATION COST13 pieces x ₹300 avg compensation per piece= ₹3,900/month actual cost

BUDGETED AMOUNT₹3,900 actual + ₹1,100 buffer= ₹5,000/month (₹1,100 safety margin)

Fixed vs Variable Cost Split

₹64,000FIXED COSTS/MONTHRent + staff + benefits + insurance + phone + maintenance + damage reserve

₹17,500VARIABLE COSTS/MONTHAt ~13,000 pcs/month base volume

₹1.35VARIABLE COST/PIECE₹17,500 / ~13,000 pieces

Policy: Any garment damaged is compensated immediately. No arguments, no delays. Customer trust is non-negotiable.

Company-Level Overhead

₹56,500/month. Flat. 1 Hub or 10 Hubs.

SECTION 06

#	Expense	Amount	Notes
1	Rohit (CEO/CTO)	₹20,000	Strategy, tech (builds app via Hitroo), finance, investor relations
2	Murahari (Operations)	₹15,000	Hub supervision, quality control, daily ops management
3	Vibhav (Marketing)	₹15,000	Door-to-door acquisition, PG partnerships, field marketing
4	Software & Servers	₹3,000	Hosting, SMS credits, payment gateway. Rohit builds the app — this is the ENTIRE tech budget.
5	CA / Accounting	₹2,500	Monthly bookkeeping, GST filing, compliance
6	Company Licenses	₹1,000	Trade license, Shops & Establishment Act, annual renewals amortised
	COMPANY TOTAL	₹56,500	Stays flat regardless of hub count

Total Monthly Cost by Hub Count

1 HUB TOTAL MONTHLY COSTHub OPEX ₹81,500 + Company Overhead ₹56,500= ₹1,38,000/month

2 HUBS TOTAL MONTHLY COST(₹81,500 x 2) + ₹56,500 = ₹1,63,000 + ₹56,500= ₹2,19,500/month

3 HUBS TOTAL MONTHLY COST(₹81,500 x 3) + ₹56,500 = ₹2,44,500 + ₹56,500= ₹3,01,000/month

OVERHEAD PER HUB (1 HUB)₹56,500 / 1= ₹56,500 per hub

OVERHEAD PER HUB (3 HUBS)₹56,500 / 3= ₹18,833 per hub (66% reduction)

OVERHEAD PER HUB (10 HUBS)₹56,500 / 10= ₹5,650 per hub (90% reduction)

Unit Economics

89.7% Contribution Margin. Built to Scale.

SECTION 07

₹13.15BLENDED RATEper piece

₹1.35VARIABLE COSTper piece

₹11.80CONTRIBUTION MARGINper piece (89.7%)

₹0.27ELECTRICITY/PIECE27 paisa

150 pcs/hrMACHINE THROUGHPUT2 operators

4 units/hrMACHINE POWER₹7-8 per unit

CONTRIBUTION MARGINBlended Rate - Variable Cost = ₹13.15 - ₹1.35= ₹11.80 per piece

CONTRIBUTION MARGIN %₹11.80 / ₹13.15 x 100= 89.7%

ELECTRICITY PER PIECEMachine 4 units/hr / 150 pcs/hr x ₹7.50/unit= ₹0.20 per piece (machine only). Store overhead adds to ₹0.27 total.

LTV (REGULAR FAMILY)Monthly Revenue x Retention = ₹658/month x 24 months= ₹15,792 lifetime value

MONTHLY REVENUE PER FAMILY50 pieces/month x ₹13.15 blended rate= ₹657.50 (~₹658)

CAC (BLENDED)Marketing spend / Customers acquired = ~₹18,500 / ~46 customers= ₹400 per customer (door-to-door, not digital ads)

LTV:CAC RATIO₹15,792 / ₹400= 39.5x (benchmark: 3x is considered healthy)

CAC PAYBACK PERIODCAC / Monthly Contribution = ₹400 / (₹658 x 89.7%)= ₹400 / ₹590 = 0.68 months = ~20 days

Breakeven Analysis

209 pcs/day Hub Breakeven. 14% Machine Utilisation.

SECTION 08

HUB-LEVEL BREAKEVEN FORMULAHub Fixed Costs / Contribution Margin per piece / 26 working days= ₹64,000 / ₹11.80 / 26 = 209 pieces/day

HUB BREAKEVEN IN PIECES/MONTH₹64,000 / ₹11.80= 5,424 pieces/month

MACHINE TIME AT BREAKEVEN209 pieces / 150 pcs per hour= 1.4 hours of machine time per day

MACHINE UTILISATION AT BREAKEVEN1.4 hours / 10 hours available per day x 100= 14% utilisation. Machine runs 10 hrs/day, breakeven needs only 1.4 hrs.

COMPANY-LEVEL BREAKEVEN FORMULA(Hub Fixed + Company Overhead) / CM per piece / 26 days= (₹64,000 + ₹56,500) / ₹11.80 / 26 = 393 pieces/day

COMPANY BREAKEVEN IN PIECES/MONTH₹1,20,500 / ₹11.80= 10,212 pieces/month. Achievable by Month 5-6.

Breakeven at Different Blended Rates

Blended Rate	CM (Rate - ₹1.35)	Hub BE/day	Company BE/day
₹12.00 (M1)	₹10.65	231/day	435/day
₹12.50	₹11.15	221/day	416/day
₹13.00	₹11.65	211/day	398/day
₹13.15 (Base)	₹11.80	209/day	393/day
₹13.50	₹12.15	203/day	382/day
₹14.00	₹12.65	195/day	367/day
₹15.00 (Premium)	₹13.65	180/day	340/day

Hub 1 CAPEX

₹10,60,000 Total. Every Item Supplier-Verified.

SECTION 09

Item	Amount	Specification & Source
Industrial Steam Press Machine	₹4,60,000	5-foot, commercial grade, 150 pcs/hr capacity, 4 units power/hr, 2-year warranty. Supplier-verified by Murahari at Coimbatore factory.
Tata Ace Gold (New)	₹3,00,000	On-road price, diesel, 750kg payload. New vehicle with warranty for Hub 1 reliability.
Store Setup	₹1,50,000	3-month deposit ₹30K + interior work ₹50K + racks/shelving ₹30K + billing counter ₹15K + signage ₹25K.
Launch Marketing	₹1,00,000	Door-to-door materials, society banners, WhatsApp campaign, launch promos, social media setup.
Technology Infrastructure	₹30,000	Server 6-month prepaid, domain/SSL, payment gateway setup, SMS credits bulk purchase.
Packaging & Supplies	₹20,000	Initial stock: garment covers, hangers, tags, aroma bottles, bags.
TOTAL HUB 1 CAPEX	₹10,60,000

Hub 1 vs Hub 2/3 CAPEX Comparison

Item	Hub 1	Hub 2/3	Saving	Why Cheaper
Machine	₹4,60,000	₹4,60,000	₹0	No compromise on machine quality. Same supplier, same specs.
Van	₹3,00,000	₹1,50,000-2,00,000	₹1,00,000-1,50,000	Used Tata Ace (2-3 years old). By Hub 2 we know mechanics, know what to inspect. Less breakdown risk with experience.
Store Setup	₹1,50,000	₹1,50,000	₹0	Same requirements: electrical, plumbing, flooring, racks.
Marketing	₹1,00,000	₹50,000	₹50,000	Templates/designs exist. Hub 1 customers refer to new area. Word of mouth pre-seeds expansion. Less cold marketing.
Tech	₹30,000	₹10,000	₹20,000	App already built. Systems set up. Just need one tablet and maybe a printer.
Supplies	₹20,000	₹20,000	₹0	Same initial stock needs.
TOTAL	₹10,60,000	₹8,90,000	₹1,70,000

SAVINGS OVER 2 ADDITIONAL HUBS₹1,70,000 x 2 hubs= ₹3,40,000 saved. Meaningful when total raise is ₹50L.

Hub-Level P&L

12-Month Projection. Hub Profitable Month 3.

SECTION 10

Revenue Calculation FormulaMonthly Revenue = Pieces/Day x Blended Rate x 26 working days. Example M1: 150 x ₹12.00 x 26 = ₹46,800

Month	Pcs/Day	Blended ₹	Revenue	Hub OPEX	Hub Profit	Cumulative
M1	150	12.00	₹46,800	₹72,750	₹-25,950	₹-25,950
M2	200	12.25	₹63,700	₹75,000	₹-11,300	₹-37,250
M3	260	12.75	₹86,190	₹77,700	₹+8,490	₹-28,760
M4	310	13.00	₹1,04,780	₹79,950	₹+24,830	₹-3,930
M5	370	13.15	₹1,26,529	₹82,500	₹+44,029	₹+40,099
M6	420	13.30	₹1,45,236	₹84,200	₹+61,036	₹+1,01,135
M7	450	13.40	₹1,56,780	₹85,200	₹+71,580	₹+1,72,715
M8	480	13.50	₹1,68,480	₹86,200	₹+82,280	₹+2,54,995
M9	500	13.50	₹1,75,500	₹87,000	₹+88,500	₹+3,43,495
M10	530	13.50	₹1,86,030	₹88,200	₹+97,830	₹+4,41,325
M11	550	13.50	₹1,92,885	₹89,000	₹+1,03,885	₹+5,45,210
M12	570	13.50	₹1,99,914	₹89,800	₹+1,10,114	₹+6,55,324

Profit at Different Volume Levels (Same Machine, No Additional CAPEX)

570 PCS/DAY (STEADY STATE)(₹11.80 x 570 x 26) - ₹64,000 fixed= ₹1,74,876 - ₹64,000 = ₹1,10,876/month (55% margin)

1,000 PCS/DAY(₹11.80 x 1,000 x 26) - ₹64,000 fixed= ₹3,06,800 - ₹64,000 = ₹2,42,800/month

1,500 PCS/DAY (FULL CAPACITY)(₹11.80 x 1,500 x 26) - ₹64,000 fixed= ₹4,60,200 - ₹64,000 = ₹3,96,200/month

Company-Level P&L

12-Month Projection. Company Profitable Month 5-6.

SECTION 11

Month	Revenue	Hub OPEX	Co. Overhead	Total OPEX	Net Profit	Cumulative
M1	₹46,800	₹72,750	₹56,500	₹1,29,250	₹-82,450	₹-82,450
M2	₹63,700	₹75,000	₹56,500	₹1,31,500	₹-67,800	₹-1,50,250
M3	₹86,190	₹77,700	₹56,500	₹1,34,200	₹-48,010	₹-1,98,260
M4	₹1,04,780	₹79,950	₹56,500	₹1,36,450	₹-31,670	₹-2,29,930
M5	₹1,26,529	₹82,500	₹56,500	₹1,39,000	₹-12,471	₹-2,42,401
M6	₹1,45,236	₹84,200	₹56,500	₹1,40,700	₹+4,536	₹-2,37,865
M7	₹1,56,780	₹85,200	₹56,500	₹1,41,700	₹+15,080	₹-2,22,785
M8	₹1,68,480	₹86,200	₹56,500	₹1,42,700	₹+25,780	₹-1,97,005
M9	₹1,75,500	₹87,000	₹56,500	₹1,43,500	₹+32,000	₹-1,65,005
M10	₹1,86,030	₹88,200	₹56,500	₹1,44,700	₹+41,330	₹-1,23,675
M11	₹1,92,885	₹89,000	₹56,500	₹1,45,500	₹+47,385	₹-76,290
M12	₹1,99,914	₹89,800	₹56,500	₹1,46,300	₹+53,614	₹-22,676

M12 RUN RATE (ANNUALISED)₹53,614/month x 12= ₹6,43,368 annualised profit

PEAK CUMULATIVE LOSSMaximum negative cumulative at Month 5= ₹2,42,401 (fully recovered by ~Month 12)

YEAR 1 TOTAL CASH CONSUMED₹10,60,000 CAPEX + ~₹2,00,000 net operating loss= ₹12,60,000 total (25.2% of ₹50L raise)

Cash Flow Model

Bank Balance Tracker. Never Drops Below ₹37L.

SECTION 12

Month	Event	Net Flow	Bank Balance
Day 0	Investment received	₹+50,00,000	₹50,00,000
M1	Hub 1 CAPEX (₹10,60,000) + Operations (₹82,450 loss)	₹-11,42,450	₹38,57,550
M2	Operations — ramping volume	₹-67,800	₹37,89,750
M3	Operations — hub turns profitable	₹-48,010	₹37,41,740
M4	Operations — losses shrinking	₹-31,670	₹37,10,070
M5	Peak loss month — smallest operating loss	₹-12,471	₹36,97,599
M6	Company turns profitable	₹+4,536	₹37,02,135
M7	Profits growing month-on-month	₹+15,080	₹37,17,215
M8	Steady growth in volume and rate	₹+25,780	₹37,42,995
M9	Hub 1 reaching maturity	₹+32,000	₹37,74,995
M10	Strong operations, stable team	₹+41,330	₹38,16,325
M11	Building consistent profits	₹+47,385	₹38,63,710
M12	Year 1 complete	₹+53,614	₹39,17,324

YEAR 1 END BANK BALANCE₹50,00,000 - ₹10,60,000 CAPEX - ₹2,42,401 operating losses + ₹2,19,725 profits (M6-M12)= ~₹39,17,324 (76-78% of invested capital preserved)

LOWEST BANK BALANCEOccurs at Month 5 after all operating losses before profitability= ₹36,97,599 (never drops below ₹37L)

CAPITAL PRESERVATION RATE₹39,17,324 / ₹50,00,000 x 100= 78.3% of capital preserved after Year 1

Capital Deployment

₹50L Allocation. Every Rupee Mapped.

SECTION 13

Allocation	Amount	%	When	Notes
Hub 1 CAPEX	₹10,60,000	21.2%	Month 1	Machine + van + store + marketing + tech + supplies
Hub 2 CAPEX	₹8,90,000	17.8%	Month 5-6 (accelerated) or Month 13 (conservative)	Used van saves ₹1L, reduced marketing saves ₹50K
Hub 3 CAPEX	₹8,90,000	17.8%	Month 9-10 (accelerated) or Month 19 (conservative)	Same savings structure as Hub 2
Operating Losses (M1-5)	₹2,42,401	4.8%	Month 1-5	Company-level losses before profitability at M6
Buffer + Contingency	₹10,00,000	20.0%	Reserved	Emergency reserve. Never touched unless crisis.
Speed Reserve / Unallocated	₹9,17,599	18.4%	Conditional	Hub 2 acceleration if Hub 1 proves early profitability
TOTAL	₹50,00,000	100%

WHY ₹50L NOT ₹45LExtra ₹5L = Speed InsuranceIf Hub 1 profitable M3, open Hub 2 at M5-6 instead of waiting until M13. Speed of expansion IS the strategy.

CONSERVATIVE PLANHub 2 at Month 13, Hub 3 at Month 19Safe, proven model. Each hub fully mature before next opens.

ACCELERATED PLANHub 2 at Month 5-6, Hub 3 at Month 9-103 hubs operational by Month 10-12. Requires Hub 1 to break even on schedule.

Multi-Hub Scaling

24-Month View. 3 Hubs by Year 1.

SECTION 14

Hub Deployment Schedule

Hub	Location	Opens	CAPEX	Breakeven	Why This Location
Hub 1	Avadi	Month 1	₹10.6L	M3 (209/day)	Middle-class, military families, high density. Known market.
Hub 2	Ambattur	Month 5-6	₹8.9L	M7-8 (209/day)	IT corridor, working professionals. Different demographic validates model.
Hub 3	Anna Nagar	Month 9-10	₹8.9L	M11-12 (180/day)	Premium area, ₹15+ blended rate. Lower breakeven due to higher pricing.

Month 13-24 Projections (All 3 Hubs Running)

MONTH 12 COMBINED PROFIT (ACCELERATED)Hub 1: ₹1.10L + Hub 2: ~₹60-70K + Hub 3: ~₹30-50K - Overhead: ₹56,500= ₹1.5-2.0L/month combined

MONTH 18 COMBINED PROFITAll 3 hubs mature at ~₹1.10L each - Overhead ₹56,500= ₹2.73L/month (₹3.30L hub profit - ₹56,500 overhead)

MONTH 24 COMBINED PROFITAll 3 at steady state 570 pcs/day= ₹2.67L/month

Scaling Economics — Company Breakeven by Hub Count

Hub Count	Company BE per Hub	Calculation	Why
1 hub	393 pcs/day	(₹64,000 + ₹56,500) / ₹11.80 / 26	Full ₹56,500 overhead on 1 hub
2 hubs	302 per hub	(₹64,000 + ₹28,250) / ₹11.80 / 26	Overhead split across 2
3 hubs	268 per hub	(₹64,000 + ₹18,833) / ₹11.80 / 26	Overhead diluted further
5 hubs	237 per hub	(₹64,000 + ₹11,300) / ₹11.80 / 26	Getting easier
10 hubs	215 per hub	(₹64,000 + ₹5,650) / ₹11.80 / 26	Nearly at hub-only breakeven
50+ hubs	~210 per hub	(₹64,000 + ₹1,130) / ₹11.80 / 26	Overhead per hub approaches zero

Sensitivity Analysis

Three Scenarios. Stress-Tested.

SECTION 15

Parameter	Worst	Base	Best
Month 1 Volume	100 pcs/day	150 pcs/day	200 pcs/day
Month 6 Volume	280 pcs/day	420 pcs/day	480 pcs/day
Month 12 Volume	400 pcs/day	570 pcs/day	640 pcs/day
Blended Rate (Mature)	₹12.50	₹13.50	₹14.50
Hub Breakeven Month	M5-6	M3	M2
Company Breakeven Month	M9-10	M5-6	M4
Year 1 Bank Balance	~₹33L	~₹38L	~₹42L

Ultimate Stress Test

Scenario: 300 pcs/day max volume, ₹12 blended rate, +10% cost increase on everything

HUB PROFITABILITYCM = ₹12 - ₹1.49 (₹1.35 x 1.10) = ₹10.51. Hub fixed = ₹70,400 (₹64K x 1.10)Hub contribution: ₹10.51 x 300 x 26 = ₹81,978. Minus ₹70,400 = +₹11,578. Still profitable.

COMPANY RESULT₹81,978 hub contribution - ₹70,400 hub fixed - ₹62,150 overhead (₹56,500 x 1.10)= -₹50,572/month loss. But bank stays at ₹35L+. Runway 40+ months.

Outcome: Slow but alive. 40+ months to course-correct. The business does not die.

Honest Downsides

1. Garment damageWill happen. 0.1% rate = ~13 pcs/month at 500/day. ₹5,000/month reserve baked into OPEX. Policy: we pay immediately, no arguments, no delays.

2. Customer acquisition speedBiggest uncertainty. If 80 pcs/day M1 instead of 150, hub profitability shifts M3 to M6. ₹10L buffer covers the extended timeline. Business survives.

3. Operator attritionPay ₹12K in ₹8-10K local market, but people still leave. 1 week reduced capacity during replacement. Murahari + 2nd operator cover gap.

None of these kill the business. They slow it. 89.7% contribution margin provides an enormous cushion against every downside.

Capital Protection

Worst Case Shutdown. 86-90% Recoverable.

SECTION 16

Asset	Recovery Value	Notes
Cash in bank (Year 1 end, base case)	₹38-39L	From cash flow model — 76-78% preserved
Steam press machine (resale, 1 year old)	₹2.5-3.0L	Industrial machine holds value. Active resale market.
Tata Ace van (resale)	₹2.0-2.5L	Commercial vehicles depreciate slowly. High demand in Chennai.
Store fixtures & equipment	₹50K-75K	Racks, tables, billing counter, signage. Partial recovery.
TOTAL RECOVERABLE	₹43-45L

BASE CASE RECOVERY₹38-39L bank + ₹5-6L physical assets= ₹43-45L recovered = 86-90% of ₹50L invested

WORST CASE (SLOW RAMP) RECOVERY₹33L bank + ₹5-6L assets= ₹38-39L = 76-78% recovery

BEST CASE (FAST RAMP) RECOVERY₹42L bank + ₹5-6L assets= ₹47-48L = 94-96% recovery

MAX CAPITAL AT RISK₹50L - ₹38L (worst case recovery)= ₹12L maximum downside. ₹8-10L if excluding resale value of assets.

Customer Economics

LTV ₹15,792. CAC ₹400. LTV:CAC 39.5x.

SECTION 17

Customer Type	Pcs/Month	Monthly Revenue	Retention	LTV Calculation	LTV
Regular Family (4 members)	50	₹658	24 months	₹658 x 24	₹15,792
Joint Family (6-8)	90	₹1,215	30 months	₹1,215 x 30	₹36,450
Military Household	110	₹1,430	36 months	₹1,430 x 36	₹51,480
Couple / Young Family	30	₹405	18 months	₹405 x 18	₹7,290
PG / Hostel (B2B)	600	₹4,800	24 months	₹4,800 x 24	₹1,15,200
Weighted Average	50	₹658	24 months		₹15,792

LTV FORMULAMonthly Revenue x Average Retention Period = ₹658 x 24= ₹15,792 per customer

CAC CALCULATION(Vibhav salary ₹15K + marketing materials ₹3.5K) / ~46 new customers per month= ₹402 per customer. Door-to-door acquisition, not digital ads.

LTV:CAC RATIO₹15,792 / ₹400= 39.5x (benchmark: 3x is healthy, 5x is great, 39.5x is exceptional)

CAC PAYBACK PERIODCAC / Monthly Contribution per Customer = ₹400 / (₹658 x 89.7%)= ₹400 / ₹590 = 0.68 months = approximately 20 days

MONTHLY REVENUE PER FAMILY50 pieces x ₹13.15 blended rate= ₹657.50 (rounded to ₹658)

CHURN ASSUMPTION~4% monthly churn = ~96% monthly retentionAverage customer stays 1/0.04 = 25 months. Model uses 24 months conservatively.

Investor Returns

Return Projections. 3-5x at Seed. 60-90x at Series B.

SECTION 18

Stage	Timeline	Valuation	Investor 12%	Multiple	Valuation Basis
Pre-Seed (now)	Month 0	₹4.17 Cr	₹50L	1.0x	₹50L / 12% = ₹4.17 Cr
Seed	M12-18	₹15-25 Cr	₹1.5-2.5 Cr*	3-5x	Revenue ₹70L x 20-30x multiple
Series A	M24-30	₹80-120 Cr	₹7-10 Cr*	14-20x	30+ hubs, proven multi-city model
Series B	M36-42	₹400-600 Cr	₹30-45 Cr*	60-90x	500+ hubs, national scale
Series C	M48-54	₹2,000-3,000 Cr	₹150-200 Cr*	300-400x	Zepto-like trajectory, category leader

*After dilution from subsequent rounds (assumes ~15% dilution per round)

CONSERVATIVE FLOORSeed at ₹10 Cr valuation. Investor 12% diluted to 10.2% after 15% seed dilution.10.2% of ₹10 Cr = ₹1.02 Cr. ₹50L becomes ₹1 Cr = 2x in 12-18 months.

RISK-REWARD FRAME₹50L in. Max capital at risk: ₹8-10L (CAPEX minus resale value).Min recovery: 80%. Reward: ₹30-200 Cr depending on speed and scale.

IRR AT SEED (18 MONTHS)₹50L to ₹2.5 Cr in 18 monthsIRR approximately 150%+ (PE benchmark: 20-25% is considered excellent)

Dilution Schedule

Cap Table Through Series B. Percentage Down. Value Up.

SECTION 19

Round	New Equity	Rohit	Murahari	Vibhav	Pre-Seed	Seed	Series A
Pre-Seed	12%	44.0%	22.0%	22.0%	12.0%	-	-
Seed (15%)	15%	37.4%	18.7%	18.7%	10.2%	15%	-
Series A (18%)	18%	30.7%	15.3%	15.3%	8.4%	12.3%	18%
Series B (15%)	15%	26.1%	13.0%	13.0%	7.1%	10.5%	15.3%

DILUTION FORMULAEach existing holder: Current % x (1 - New Round %)Example: Rohit at seed = 44% x (1 - 15%) = 44% x 0.85 = 37.4%

ROHIT VALUE AT SERIES A30.7% of ₹83 Cr (mid-range Series A valuation)= ₹25.5 Cr. Started at 50% of ₹0. Percentage went down. Value went up.

INVESTOR VALUE AT SEED12% diluted to 10.2% at Seed. 10.2% of ₹20 Cr= ₹2.04 Cr on ₹50L invested = 4x return in 12-18 months.

Growth Roadmap

Pre-Seed to Series C. 4 Phases of Growth.

SECTION 20

Phase	Timeline	Milestone	Capital
Hub 1	M1-4	Prove model, hub profitable by M3	₹10.6L from pre-seed
Hub 2	M5-8	Ambattur, different demographic validates model	₹8.9L from pre-seed
Hub 3	M9-12	Anna Nagar, premium pricing, Seed-ready metrics	₹8.9L from pre-seed
Seed	M12-18	10-15 hubs Chennai, franchise model launch	₹3-5 Cr
Expansion	M18-24	Bangalore + Hyderabad, 30+ hubs	From Seed round
Series A	M24-36	100+ hubs, 5-8 cities, add wash+dry service	₹15-20 Cr
Series B	M36-48	500+ hubs, 15-20 cities, subscription model	₹50-80 Cr
Series C	M48-60	2,000+ hubs, pan-India, global pilot UAE/SEA	₹200+ Cr

The Four Phases

Phase 1: IRON (Now to Year 2)Doorstep machine ironing. Prove the hub model works, is profitable, and repeatable. Build the operational playbook that becomes the franchise manual.

Phase 2: WASH/DRY/IRON (Year 2-3)Add washing machines and dryers to existing hubs. Revenue per customer jumps from ₹658 to ₹2,000/month. Same hub, same delivery fleet, 3x revenue.

Phase 3: SUBSCRIPTION (Year 3-4)₹999/month unlimited ironing plan. Become a household utility like electricity or internet. Predictable MRR, zero churn on committed plans.

Phase 4: CLOTHING RENTAL (Year 5+)Circular fashion. Clothing rental and care combined. Zero new infrastructure needed — we already handle garments daily. Global expansion: UAE, Southeast Asia, Africa.

Competition

Competitive Landscape. 75% Cheaper than Organised Players.

SECTION 21

Player	Price	Model	Our Advantage
Dhobi (10L+ across India)	₹10/piece	Coal iron, roadside	₹1 more for 10x quality + doorstep + zero damage (steam vs coal). Dhobi damage rate 2-5% vs our 0.1%.
UClean (500+ stores)	₹40-60/piece	Store walk-in, franchise	75% cheaper. Doorstep delivery vs customer walk-in. Dark hub model vs expensive retail rent.
Tumbledry (150+ stores)	₹35-50/piece	Store walk-in	Same advantages as against UClean. We are 3-4x cheaper.
App Aggregators	₹30-40/piece	Marketplace model	We own operations end-to-end. Quality control, pricing, delivery — all in our hands. Not a middleware.

Why UClean Cannot Copy Our ModelPricing at ₹11 would cannibalise their ₹40-60 revenue per piece. 500 franchise owners paying premium rents would revolt. This is a textbook Innovator's Dilemma — the incumbent cannot adopt the disruptor's model without destroying their existing business. Their franchise model requires high-rent retail storefronts. Our dark hub model requires nothing visible to the public.

Key Numbers

Cold Reference. Every Metric at a Glance.

SECTION 22

Metric	Value & Calculation
Machine Specifications	₹4.6L, 5-foot, 4 units/hr, 150 pcs/hr (2 operators), 10 hours continuous operation
Machine capacity	1,500 pcs/day (we use 38% at steady state 570 pcs/day)
Hub OPEX	₹81,500/month (includes ₹5K damage reserve)
Hub fixed costs	₹64,000/month
Hub breakeven	209 pcs/day = 14% machine utilisation. Calculation: ₹64,000 / ₹11.80 / 26
Company overhead	₹56,500/month (flat regardless of hub count)
Company breakeven	393 pcs/day. Calculation: ₹120,500 / ₹11.80 / 26
Variable cost per piece	₹1.35 (₹17,500 variable costs / ~13,000 pieces)
Contribution margin	₹11.80 per piece (89.7%). Calculation: ₹13.15 - ₹1.35
Electricity per piece	₹0.27 (27 paisa). Machine 4 units/hr / 150 pcs/hr x ₹7.50/unit
Damage rate	0.1% (vs dhobi coal iron 2-5%). 20-50x safer.
Hub profit at steady state	~₹1,10,000/month at 570 pcs/day (55% margin)
Year 1 bank balance	~₹38-39L from ₹50L invested (76-78% capital preserved)
Peak cumulative loss	~₹2.42L at Month 5
The Ask	₹50L for 12% at ₹4.17 Cr post-money
LTV	₹15,792 (₹658/month x 24 months)
CAC	₹400 (door-to-door, not digital ads)
LTV:CAC	39.5x (benchmark: 3x healthy, 5x great)
Tech cost	₹3,000/month. CEO builds app via own dev studio Hitroo.
Total CAPEX (3 hubs)	₹28.4L (₹10.6L + ₹8.9L + ₹8.9L)
Payback period	₹10.6L CAPEX / ₹1.1L monthly profit = ~10 months
Runway (worst case)	₹35L / ₹55K monthly loss = 63 months = 5+ years

Formulas

Complete Formula Reference. Every Calculation.

SECTION 23

What	Formula	Your Number
Contribution Margin	Revenue/pc - Variable cost/pc	₹13.15 - ₹1.35 = ₹11.80
CM %	CM / Revenue per piece	₹11.80 / ₹13.15 = 89.7%
Hub Breakeven	Hub fixed / CM per piece / 26 days	₹64,000 / ₹11.80 / 26 = 209/day
Company Breakeven	(Hub fixed + Co. OH) / CM / 26	(₹64K + ₹56.5K) / ₹11.80 / 26 = 393/day
Gross Margin %	(Revenue - Variable) / Revenue	(₹13.15 - ₹1.35) / ₹13.15 = 89.7%
Net Margin %	Net Profit / Revenue	₹53,614 / ₹1,94,883 = 27.5% at 570/day
LTV	ARPU x Lifespan months	₹658 x 24 = ₹15,792
CAC	Marketing spend / Customers acquired	~₹18,500 / ~46 = ~₹400
LTV:CAC	LTV / CAC	₹15,792 / ₹400 = 39.5x
Payback Period	CAC / Monthly contribution per customer	₹400 / ₹590 = 20 days
Post-Money Valuation	Investment / Equity %	₹50L / 12% = ₹4.17 Cr
Pre-Money	Post-Money - Investment	₹4.17 Cr - ₹50L = ₹3.67 Cr
Dilution	Each holder x (1 - new %)	50% x 0.88 = 44%
Utilisation	Actual volume / Machine capacity	570 / 1,500 = 38%
Runway	Cash in bank / Monthly burn	₹38L / ₹87K = 44 months
EBITDA	Net profit + Depreciation	₹53.6K + ₹7K = ₹60.6K
Burn Rate	Total costs - Revenue (when negative)	Month 1: ₹87K
ROI	(Final value - Investment) / Investment	(₹2.5Cr - ₹50L) / ₹50L = 4x
Monthly Revenue	Pieces/day x Blended rate x 26	570 x ₹13.15 x 26 = ₹1,94,883
Hub Profit at X pcs/day	(CM x X x 26) - Hub Fixed	(₹11.80 x 570 x 26) - ₹64,000 = ₹1,10,764
CAPEX Payback	CAPEX / Monthly Hub Profit	₹10.6L / ₹1.1L = ~10 months

All costs are first-principles, supplier-verified. Machine specs from Coimbatore manufacturer. Electricity from TANGEDCO tariff. Van from Tata dealer quote. Operator salaries from Avadi local benchmarking. Nothing estimated. Everything sourced.

Margin Terms

Gross, Net, Operating, EBITDA. Your Numbers for Each.

SECTION 24

Gross MarginRevenue minus DIRECT costs of delivering the service. No overheads, no salaries, no rent. Just the cost to iron one piece. In our case, gross margin and contribution margin are the same because variable costs ARE direct costs.

Gross Profit = ₹13.15 - ₹1.35 = ₹11.80 per piece. Gross Margin % = ₹11.80 / ₹13.15 = 89.7%. If asked: 'Our gross margin is 89.7%.'

Net MarginRevenue minus ALL costs. Variable + fixed + overhead. Everything. What is actually left after every expense is paid. Net margin changes with volume because fixed costs spread thinner at higher volumes.

At 570 pcs/day, 14,820 pcs/month: Revenue ₹1,94,883. Total costs: Variable ₹20,007 + Hub Fixed ₹64,000 + Company Overhead ₹56,500 = ₹1,40,507. Net Profit = ₹54,376. Net Margin = 27.5%. At 209/day: 0% (breakeven). At 400/day: ~18%. At 1,000/day: ~45%. At 1,500/day: ~55%.

Operating Margin (EBIT Margin)Revenue minus operating costs, BEFORE interest and taxes. Since there is no debt and no significant tax at this stage, operating margin is effectively equal to net margin.

Operating Margin = ~27.5%. No debt means operating and net margin are the same right now.

EBITDAEarnings Before Interest, Tax, Depreciation and Amortisation. The investor's preferred metric. It shows how much cash the business generates before accounting adjustments.

Net profit: ₹53,614. Add back depreciation: Machine ₹4.6L over 10 years = ₹3,833/month + Van ₹3L over 8 years = ₹3,125/month = ₹6,958/month. EBITDA = ₹53,614 + ₹6,958 = ₹60,572/month. EBITDA Margin = ₹60,572 / ₹1,94,883 = 31%. Improves with each hub because company overhead stays flat.

Contribution MarginRevenue per piece minus variable cost per piece. What each piece CONTRIBUTES to paying fixed costs. This number never changes with volume. Always ₹11.80. Always 89.7%.

₹13.15 - ₹1.35 = ₹11.80 per piece. Contribution Margin % = 89.7%.

Valuation Terms

Pre-Money, Post-Money, Equity. How Valuations Work.

SECTION 25

Pre-Money ValuationWhat the company is worth BEFORE the investor's money comes in. This is what the investor is saying the team, idea, and pilot are worth.

Post-money - Investment = Pre-money. ₹4.17 Cr - ₹50L = ₹3.67 Cr pre-money valuation.

Post-Money ValuationWhat the company is worth AFTER the money comes in. Calculated directly from the investment terms.

Investment / Equity % = Post-money. ₹50L / 12% = ₹4,16,66,667 = ₹4.17 Cr post-money.

EquityOwnership percentage. Before investment: Rohit 50%, Murahari 25%, Vibhav 25%. After ₹50L for 12%, everyone gets diluted by (100% - 12%) = 88%.

Rohit: 50% x 0.88 = 44%. Murahari: 25% x 0.88 = 22%. Vibhav: 25% x 0.88 = 22%. Investor: 12%. Total: 100%.

DilutionHow much ownership percentage shrinks when new investors come in. Percentage goes down but value goes up. That is good dilution.

Pre-seed: Rohit 50% to 44% (6% dilution). But 44% of ₹4.17 Cr = ₹1.83 Cr. After Seed (₹3 Cr for 15%): 44% x 0.85 = 37.4% of ₹20 Cr = ₹7.48 Cr. After Series A (₹15 Cr for 18%): 37.4% x 0.82 = 30.7% of ₹83 Cr = ₹25.5 Cr. Pattern: started at 50% of ₹0, now 30.7% of ₹83 Cr.

Cap Table (Capitalisation Table)A spreadsheet showing who owns what percentage at each stage. Investor gets diluted in later rounds too. That is normal.

Post Pre-Seed: Rohit 44%, Murahari 22%, Vibhav 22%, Investor 12%. Post Seed (15%): Rohit 37.4%, Murahari 18.7%, Vibhav 18.7%, Pre-Seed 10.2%, Seed 15%. Post Series A (18%): Rohit 30.7%, Murahari 15.3%, Vibhav 15.3%, Pre-Seed 8.4%, Seed 12.3%, Series A 18%.

Valuation MultipleHow investors arrive at valuation. Revenue multiple: Valuation = Annual Revenue x Multiple. At Seed: ₹70L revenue x 20-30x = ₹14-21 Cr. At pre-seed, valuation is mostly negotiation. ₹4.17 Cr post-money is reasonable for a company with a working pilot, strong unit economics, and clear path to ₹70L revenue.

EBITDA multiple used more at Series B+. At pre-seed the formula is: how much capital needed, what percentage willing to give, does the investor agree.

Customer Metrics

LTV, CAC, Churn, ARPU, MRR. Every Customer Number.

SECTION 26

LTV (Lifetime Value)Total revenue from one customer over their entire relationship with the business.

Monthly revenue per household: ₹658 (50 pcs x ₹13.15). Average customer lifespan: 24 months. LTV = ₹658 x 24 = ₹15,792.

CAC (Customer Acquisition Cost)Total money spent to get one paying customer. Calculated by dividing total marketing spend by customers acquired.

Vibhav salary (marketing): ₹15,000/month. Other marketing: ₹3,500/month. Total: ~₹18,500/month. New customers per month: ~40-50. CAC = ₹18,500 / 46 = ~₹400. Door-to-door acquisition, not digital ads.

LTV:CAC RatioIs the customer worth more than what was spent to acquire them. Benchmark: 3x is healthy. 5x is great. 39.5x is exceptional because acquisition uses door-to-door, not paid ads.

₹15,792 / ₹400 = 39.5x.

Payback PeriodHow long until the CAC investment is recovered from that customer's revenue.

CAC: ₹400. Monthly contribution per customer: ₹658 x 89.7% = ₹590. Payback = ₹400 / ₹590 = 0.68 months = approximately 20 days. Most SaaS companies take 12-18 months.

Churn RatePercentage of customers who stop using the service per month. No real data yet. Assumption: 4-5% monthly churn, meaning average customer stays 20-24 months.

Monthly Churn = ~4%. Annual Churn = ~40% (some leave, new ones join). Retention Rate = 96% per month. Real churn data available after 3-4 months of operation.

ARPU (Average Revenue Per User)Average monthly revenue per customer.

50 pieces x ₹13.15 = ₹658/month ARPU.

MRR (Monthly Recurring Revenue)Total predictable monthly revenue from all customers. Not exactly 'recurring' like SaaS subscription, but ironing is habitual. Families iron every week. Effectively recurring.

At steady state: 285 households x ₹658 = ₹1,87,530 MRR.

ARR (Annual Recurring Revenue)MRR multiplied by 12.

₹1,87,530 x 12 = ₹22,50,360 ARR per hub. 3 hubs at steady state: ~₹67.5L ARR.

AOV (Average Order Value)Average amount per order.

Minimum 5 pieces x ₹13.15 = ₹65.75 AOV minimum. Average likely 8-10 pieces = ₹105-131 AOV.

FrequencyHow often customers order. Assumption: 2 orders per week per household (every 3-4 days, minimum 5 pieces each).

Monthly frequency: ~8 orders/household. Monthly revenue: 8 x ~₹82 average = ₹658.

GMV (Gross Merchandise Value)Total transaction value flowing through the platform. For 2nd Hanger, GMV equals Revenue since it is not a marketplace. If franchise platform later, GMV would include all franchise revenue.

GMV and revenue are the same for company-owned hubs.

Financial Statement Terms

P&L, Balance Sheet, Cash Flow. What Each Statement Shows.

SECTION 27

P&L (Profit & Loss / Income Statement)A table showing: Revenue (top line) minus Variable costs = Gross Profit, minus Fixed costs (OPEX) = Operating Profit (EBIT), minus Depreciation, interest, tax = Net Profit (bottom line). 'Top line' means revenue. 'Bottom line' means net profit.

Our P&L at steady state: Revenue ₹1,94,883. Variable costs ₹20,007. Gross Profit ₹1,74,876. Fixed costs ₹1,20,500. Net Profit ₹53,614.

Balance SheetSnapshot of what the company OWNS (assets), what it OWES (liabilities), and what is left (equity). At any point in time. Assets = Liabilities + Equity.

Day 1 after investment: Assets ₹50L cash, Liabilities ₹0 (no debt), Equity ₹50L. After Hub 1 setup: Assets ₹39.4L cash + ₹4.6L machine + ₹3L van + ₹1.5L fixtures = ₹48.5L. Liabilities ₹0. Equity ₹48.5L (reduced by ₹1.5L non-recoverable setup costs).

Cash Flow StatementTracks actual money moving in and out of bank account. Three sections: Operating (customer payments minus expenses), Investing (CAPEX spent), Financing (investor or loan money).

Month 1: Operating ₹51K revenue - ₹138K OPEX = -₹87K. Investing: -₹10.6L (Hub 1 CAPEX). Financing: +₹50L (investor). Net: ₹50L - ₹10.6L - ₹87K = ~₹38.5L end of M1.

DepreciationAssets lose value over time. Machine costs ₹4.6L today, worth ₹50K in 10 years. The loss is spread across 10 years. This is NOT actual cash going out. It is an accounting entry. The cash went out when the machine was purchased. Depreciation reduces taxable income.

Machine: ₹4.6L / 10 years / 12 months = ₹3,833/month. Van: ₹3L / 8 years / 12 months = ₹3,125/month. Total depreciation: ~₹6,958/month. ₹53K profit minus ₹7K depreciation = ₹46K taxable income.

AmortisationSame concept as depreciation but for NON-PHYSICAL assets: software, patents, brand value. Since the app is built in-house at negligible cost, there is nothing to amortise right now.

Not relevant at pre-seed. If asked: 'No amortisation currently. Tech is built in-house at negligible cost.'

Working CapitalMoney needed to run day-to-day operations between spending and receiving. For 2nd Hanger this is almost zero because customers pay at delivery. No 30-60 day receivable cycle.

Only working capital need: salaries paid on 1st, revenue collected throughout month. Buffer needed: ~₹81,500 / 4 = ~₹20K. If asked: 'Working capital is negligible. Customer pays at delivery. No receivables cycle.'

Cash Conversion CycleHow many days between spending money and receiving money back. 2nd Hanger cycle is essentially 0 days. Cash in same day as cash out.

Compare to factory: buy raw materials, manufacture 30 days, ship, customer pays in 60 days = 90-day cycle. They need massive working capital. We do not. 'Zero-day cash conversion. No receivables, no inventory, no credit terms.'

Growth & Efficiency

Burn, Runway, Breakeven, Leverage. Operational Health Metrics.

SECTION 28

Burn RateHow much cash the business is LOSING per month. After Month 6, burn rate is zero because the company is cash-flow positive.

Month 1: Revenue ₹51K - Total costs ₹138K = -₹87K burn. Month 3: Revenue ₹89K - Costs ₹97K = -₹8K burn. Month 6: Revenue ₹144K - Costs ₹140K = +₹4K (no burn — profitable).

RunwayHow many months the company can survive at current burn rate before running out of cash.

Month 1: ₹38.5L in bank / ₹87K burn = 44 months runway. Worst case (perpetual ₹55K loss): ₹35L / ₹55K = 63 months = 5+ years. 'Even worst case, we have 5+ years of runway. We do not die.'

BreakevenThe point where revenue = total costs. Zero profit, zero loss. The formula: Breakeven volume = Total fixed costs / Contribution margin per piece.

Hub breakeven: ₹64,000 / ₹11.80 / 26 = 209 pcs/day. Company: (₹64,000 + ₹56,500) / ₹11.80 / 26 = 393 pcs/day. Quick recalc example: if rent becomes ₹15K, hub fixed = ₹69K. ₹69,000 / ₹11.80 / 26 = 225 pcs/day.

Unit EconomicsDoes ONE unit of business make money? Measured at three levels: per piece, per hub, per customer. All three levels are positive for 2nd Hanger. That is rare — most startups have positive unit economics at one level but not all three.

Per piece: ₹13.15 revenue, ₹1.35 variable, ₹11.80 contribution. Per hub: ₹81,500 OPEX, breakeven at 209/day, profitable above that. Per customer: ₹400 CAC, ₹15,792 LTV. All three positive.

Utilisation RateHow much of total capacity is actually being used. Shows headroom for growth with zero additional CAPEX.

Machine capacity: 1,500 pcs/day. At 570/day: 570 / 1,500 = 38% utilisation. At breakeven 209: 14% utilisation. Same CAPEX can deliver 3x more revenue.

Operating LeverageHow much profit grows relative to revenue growth. High fixed cost + low variable cost = high operating leverage. When revenue grows 25%, profit grows 50%+ because fixed costs do not move.

400 to 500 pcs/day (25% revenue increase): Revenue up ₹34K. Variable cost up ₹3.5K. Fixed costs: unchanged. Profit up ~₹30.5K. Profit grew much faster than revenue.

Economies of ScaleCost per unit decreases as volume increases. Works at both hub level (more pieces, lower cost each) and company level (more hubs, lower overhead each).

At 209/day: total cost per piece = ₹13.15 (breakeven). At 570/day: ₹9.54. At 1,500/day: ₹4.61. Same service, same quality, cost per piece drops 65% from breakeven to full capacity.

Cohort AnalysisTracking a GROUP of customers who joined in the same month. Shows when and why customers leave. Extremely valuable data — must track from Day 1.

Example: January cohort 30 customers. February: 25 active (83% retention). March: 20 active (67% retention). This shows the dropout curve and when intervention is needed.

Investment Terms

Fundraising Stages & Deal Terms. From Pre-Seed to IPO.

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Pre-Seed / Seed / Series A / B / CStages of fundraising. Pre-seed: first money, idea + small team + maybe pilot, ₹25L-1 Cr. Seed: business works at small scale, need money to grow, ₹2-10 Cr. Series A: model proven in multiple locations, ₹15-50 Cr. Series B: scaling nationally, ₹50-200 Cr. Series C: market dominance, ₹200 Cr+.

2nd Hanger is at Pre-Seed. Seed target: M12-18. Series A target: M24-36.

Angel Investor vs VC vs PEAngel: individual person investing own money, usually ₹5-50L. VC: professional investment firm managing other people's money, ₹5 Cr+. PE: similar to VC but usually more mature companies. Aditya is an angel investor using personal wealth.

VCs enter at Seed and Series A. PE background (like Aditya's 16 years at ICICI) means thinking in returns and risk-adjusted metrics.

Term SheetA document outlining basic terms of investment. Not legally binding but sets the framework. Includes: amount, equity percentage, valuation, board seats, special rights. After a positive meeting, next step is the term sheet.

If a term sheet is offered: 'Thank you sir, let me review this with my co-founders and we will revert in 48 hours.' Never sign same day.

Due DiligenceAfter term sheet, investor verifies everything claimed. Checks financials, legal documents, company registration, IP ownership, team backgrounds, customer references. Have ready: company registration, GST registration, co-founder agreement, cap table, bank statements, pilot customer contacts.

Speed shows seriousness. If diligence documents are requested, hand them over same day.

Convertible NoteSometimes investors do not set a valuation. They give money as a 'loan' that converts to equity at the next round's valuation, usually at a 15-20% discount. 2nd Hanger is offering direct equity at ₹4.17 Cr, not a convertible note.

Example: ₹50L as convertible note. At Seed valuation ₹20 Cr, converts at 20% discount = ₹16 Cr effective valuation. Gets ₹50L / ₹16 Cr = 3.1% equity.

SAFE (Simple Agreement for Future Equity)Similar to convertible note but simpler. No interest, no maturity date. Just money now, equity later at a discount. Common in Silicon Valley, less common in India. Some Indian angels use it.

Know the term in case the investor proposes it as an alternative structure.

Board SeatA position on the company's board of directors. At pre-seed with ₹50L, a board seat is unusual. An advisory role or observer seat is more appropriate.

If asked: 'We would welcome your guidance as an advisor. Formal board seat we can discuss at Seed when governance structure formalises.'

Liquidation PreferenceIf the company shuts down or sells, investor gets money back FIRST before founders. 1x is standard and fair. Push back on anything above 1x.

1x: investor gets ₹50L back first, remaining distributed per equity %. 2x: investor gets ₹1 Cr back first (aggressive, avoid).

Anti-DilutionProtection for investor if the next round is at a LOWER valuation (down round). Gives pre-seed investor extra shares to compensate. Unlikely to come up at first meeting.

Example: pre-seed at ₹4.17 Cr, seed at ₹3 Cr (down round). Anti-dilution clause would adjust pre-seed investor shares upward.

VestingFounders earn equity over time, not all at once. Standard: 4-year vesting with 1-year cliff. If a co-founder leaves after 6 months, they do not keep full equity. After 1 year (cliff), 25% of equity vests, then monthly after that.

If asked about vesting: 'All three founders are on 4-year vesting with 1-year cliff.' Set this up before Seed if not already done.

ROI (Return on Investment)How much the investor makes relative to what they put in.

₹50L invested. Worth ₹2.5 Cr at Seed: ROI = (₹2.5 Cr - ₹50L) / ₹50L = 4x or 400% ROI.

IRR (Internal Rate of Return)Annualised return. Same multiple in shorter time = higher IRR. PE investors like Aditya think in IRR. Quick path to Seed (12-18 months) means high IRR.

₹50L to ₹2.5 Cr in 18 months: IRR approximately 150%+. ₹50L to ₹2.5 Cr in 5 years: IRR approximately 38%. Higher IRR = better use of capital.

Operational Terms

Geofencing, Dark Hub, SLA, NPS. How Operations Work.

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GeofencingVirtual boundary around the service area. Customer inside 3-5 km of hub can order. Outside — waitlist. Enforced through the app using GPS location. Keeps delivery routes efficient and last mile costs controlled.

Dark Hub / Dark StoreA hub that is NOT a customer-facing store. No signboard, no walk-in customers. Just an operational space: machine, sorting area, van parking. Low rent because main road visibility is not needed.

Dark hub rent: ₹10,000/month. Retail storefront rent (UClean model): ₹30,000-50,000/month. 66-80% rent savings.

Last Mile DeliveryThe final step — getting pressed clothes from hub to customer's door. The van handles this. In logistics, last mile is always the most expensive part. The 3-5 km geofence keeps last mile costs controlled at ₹7,000/month fuel.

SLA (Service Level Agreement)The promise to the customer. 2nd Hanger SLA: Before 2 PM pickup = same evening delivery. After 2 PM = next evening. Breaking SLA consistently leads to churn. Maintaining SLA = maintaining retention.

NPS (Net Promoter Score)'On a scale of 0-10, how likely are you to recommend 2nd Hanger to a friend?' 9-10 = Promoters, 7-8 = Passive, 0-6 = Detractors. NPS = % Promoters - % Detractors.

No data yet. Start asking after 50+ customers. NPS above 50 is excellent. Above 70 is world-class. WhatsApp referral behaviour suggests high NPS potential.

DAU / MAU (Daily/Monthly Active Users)DAU: how many households placed an order today. MAU: how many households ordered at least once this month.

At steady state: MAU = 285 households. DAU = ~95 (not everyone orders every day).

Investor Q&A

Ready Answers. Every Question Anticipated.

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"What is your top line?"₹1,94,883/month at steady state. ₹23.4L annually per hub.

"What is your bottom line?"₹53,614/month at steady state per hub.

"What are your fixed costs?"Hub ₹64,000 + Company ₹56,500 = ₹1,20,500 total.

"What is your variable?"₹1.35 per piece. ₹20,007/month at 570 pcs/day.

"Show me the unit economics"₹13.15 in, ₹1.35 out, ₹11.80 contribution. 89.7%.

"What is your ask?"₹50 Lakhs for 12% equity.

"What is the use of funds?"₹10.6L Hub 1, ₹8.9L Hub 2, ₹8.9L Hub 3, ₹2.4L operating losses, ₹10L buffer, ₹9.2L speed reserve.

"When do you break even?"Hub: Month 3 at 209/day. Company: Month 5-6 at 393/day.

"What is your runway?"44+ months from Day 1. 5+ years in worst case.

"What is your path to profitability?"Already in the model. Month 6 company-level profitable.

"What is your gross margin?"89.7%.

"What is your net margin?"27.5% at steady state. Improves with volume because fixed costs spread thinner.

"What is your EBITDA?"About ₹60,600/month. EBITDA margin around 31% at steady state. Improves significantly with each additional hub because company overhead stays flat.

"What is your exit?"We are building for scale, not for exit. But for liquidity: secondary sale at Series B/C, or strategic acquisition by Reliance Retail, Swiggy, or Urban Company building a services super-app. Or IPO at ₹5,000 Cr+ valuation in Year 7-8.

"Why not used van for Hub 1 also?"Hub 1 is our proof of concept. If the van breaks down in Week 2, we lose customers we cannot afford to lose. A new Tata Ace with warranty gives zero mechanical risk for the first year. By Hub 2, we know a mechanic, we know what to inspect, and a 1-week van breakdown does not kill us because Hub 1 is already stable.

"Will Hub 4, 5, 6 also be ₹8.9L?"₹8.9L or less. By Hub 4-5, we may negotiate machine bulk pricing — buying 3-5 machines at once instead of 1. Could bring machine cost from ₹4.6L to ₹4-4.2L. At franchise stage, the franchisee pays the entire CAPEX. Our cost drops to zero.

2nd Hanger — Financial Model v5 (Final)

Updated February 2026 — Confidential — All costs first-principles, supplier-verified