I love the irony in all the comments here criticizing his spreadsheets and arguments by people who have clearly not read the book or looked at the spreadsheets.
I once spent a long time building a pretty detailed pro forma model to raise money for a brick and mortar business in a spreadsheet. It was beautifully formatted, comprehensive, and appeared convincing. I patted myself on the back for training myself as an investment banker in 3 months.
I showed it to an i-banker friend that I respected. He barely glanced at the spreadsheet, but offered one thing:
"It's not about how detailed your model is; the most important thing is what your assumptions are."
I was floored. No one cares about spreadsheets for a tech startup, but it turns out even when you're trying to get a brick & mortar, cashflow business off the ground, still no one cares about spreadsheets.
That's probably what folks are reacting to here: the author is ultimately making an point by taking a set of assumptions and using those to derive the point. It seems like the argument is about the assumptions, not the calculations.
In case anyone's curious, here's the model in question. It was for a ping pong social club with food & beverage in NYC:
Your spreadsheets look nice! I think if I was a banker I would be thinking "okay but what if no one shows up and wants to buy". All the spreadsheets say is that you will lose at least $140k (probably more if you didn't include everything or were too optimistic) per month if and until you got some solid sales coming in.
So the bankers are just asking themself if they want you are the type of person worth losing $200k per month over and what's the chance you could make the idea work.
Your "downside" being positive also might be a red flag, if the bankers feel like making money in New York City really is as hard as people say. To a NYCer anyone saying "you will make money no matter what" sounds like a hustler.
I mean, I did download the spreadsheets and (skim) read the book after reading the parent article. TL;DR is that the spreadsheets are solid and unsurprising, though his interpretation of said spreadsheets seem to be the part that makes me ask "hmmm, I'm not sure if that follows from the evidence."
