AI for Discounted Cash Flow (‘DCF’) models in real estate.

The MaaS approach (‘Modelling As A Service’)

Using AI for cashflows (aka ‘Discounted Cashflows’ or ‘DCF modelling’) represents a raising of the efficiency bar to obtain far safer and supremely-accessible financial modelling for all involved. It combines the familiar liberal environment of Microsoft Excel, and leverages it with powerful AI and automation methods to simulate Analyst-type modelling labour. This proven and award-winning approach in New York and London is called MaaS: ‘Modelling As A Service’:

Dual Control (‘Vier Augen Prinzip’)

Dual Control means that safety checks are always present. In practice, this means a user can view results easily displayed on screen via one engine, all the investment metrics can be instantly validated and are safely and consistently double-checked via a second independent engine which produces automated and transparent new Excel Models.

Excel Models, as is customary across top organisations today, are effectively the “mathematical proof” and due diligence that the RICS Investment Valuation Report recommends – which is so vital in order to instil client confidence in real estate projections and any associated advisory discussions.

Dual Control gives more confidence to users. For example, in the covering sheet of all DashModels (Excel files produced by Dashflow), you can read an instant audit comment which confirms that all calculations were completely twice and via independent engines/methods. Indeed, there is always a minor discrepancy of a few basis points which serves as evidence that two different approaches have been applied at all times. This avoids traditional human error by ensuring safe and consistent modelling follow Discounted Cashflow standards prevalent across North America, Europe and Asia-Pacific.

A typical Excel model can be delivered by AI in approximately 30 seconds. It does not use a legacy files or an inflexible in-house model template. Each DashModel is fresh, new and untainted by legacy formulae:

No butchered corporate templates

Each DashModel for Excel is built from the ground-up with a newly-created blank workbook. Depending on the deal, the AI engine could generate anywhere between 5,000 to 20,000 or more formulae. The DashModel files are macro-free, unlocked and can be branded to suit your team’s branded business plan.

Human + spreadsheet automation wins

Because AI writes only the minimum formulae required for the “mathematical proof”, automated DashModels tend to be 95% smaller, ‘lighter’ and simpler than a typical corporate templates. In-house legacy models attempt to have all possible modelling flexibility for all types of deal, which causes tremendous baggage and complexity for Analysts. As any Analyst can confirm, a corporate template contains many cells, even entire spreadsheets, that are often irrelevant for the investment appraisal in question.

As such, a 95% saving means that the AI-generated Excel file is smaller, leaner and faster to triple-check if for any internal or 3rd party Analyst who needs to familiarise themselves with the deal from an investor, JV Partner, lender or advisory perspective.

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