Back
Vivek Joshi
Director & CEO @ Exc...ย โขย 4m
Mastering Unit Economics Unit economics isnโt just a metricโitโs your startupโs financial DNA. It reveals whether each customer adds value or drains cash. Hereโs how to build your unit economics from scratch: 1. Define Your Economic Unit What drives revenue? A customer, order, or subscription? Be clearโitโs the foundation. 2. Calculate CAC (Customer Acquisition Cost) Total sales & marketing spend รท number of new customers acquired in a given period. 3. Estimate Gross Margin per Unit Revenue per unit โ variable costs (e.g., hosting, delivery, support). 4. Project Customer Lifetime Value (LTV) LTV = ARPU ร Gross Margin % ร Average Customer Lifespan. 5. Find Contribution Margin Contribution margin = Revenue โ Variable Costs (per unit). This tells you if each sale helps cover fixed costs. 6. Calculate CAC Payback Period CAC รท monthly contribution margin per customer = months to break even. 7. Validate the LTV:CAC Ratio A healthy startup aims for LTV:CAC > 3 and payback in <12 months
More like this
Recommendations from Medial
Vivek Joshi
Director & CEO @ Exc...ย โขย 4m
Decoding Unit Economics for Early-Stage Startups Unit economics is your startupโs compass. It tells you if scaling will make you richโor broke. Hereโs how to decode it, step by step: 1. Define a Unit: This could be a customer, order, or subscriptio
See More
Vivek Joshi
Director & CEO @ Exc...ย โขย 3m
Unlock the secrets of startup success with our comprehensive guide on Decoding Unit Economics! In this video, we break down the critical components that can determine the fate of your early-stage venture. Learn how to define your unit, calculate Cust
See More
Amanat Prakash
Building xcesย โขย 5m
Day 4 Business Terms Contribution Margin โ The Profit Clue Most Businesses Ignore Most founders talk about revenue and profitโฆ but ignore what really drives profitability: Contribution Margin. What is it? Contribution Margin = Revenue โ Variable C
See More
mg
mysterious guyย โขย 3m
CAC vs LTV โ The Unit Economics Every Founder Must Know Youโre getting users. Youโre spending on ads. But is your startup actually making money per customer? If your CAC is higher than your LTV, youโre not building a business โ youโre burning cash.
See More
Swapnil gupta
Founder startupsunio...ย โขย 4m
โ Must for Business Students ๐ฅ10 Most Important metrics that are asked by investors. 1. Revenue Growth Rate 2. Monthly Recurring Revenue (MRR) 3. Burn Rate 4. Cash Runway 5. Gross Margin 6. Customer Acquisition Cost (CAC) 7. Customer Lifetime Val
See More
Dipesh Pimpale
Data Analytics | ๐๏ฟฝ...ย โขย 1y
Imporant metric for Start-ups - Break Even Units Suppose we are a shoe brand and we want to calculate our units to be sold for break even (No profit No Loss) Fixed Cost - 4,00,000 Selling Price per Unit - 1200 Variable Cost per Unit - 800 Contributi
See More
Swapnil gupta
Founder startupsunio...ย โขย 4m
๐ฅ10 Most Important metrics that are asked by investors. 1. Revenue Growth Rate 2. Monthly Recurring Revenue (MRR) 3. Burn Rate 4. Cash Runway 5. Gross Margin 6. Customer Acquisition Cost (CAC) 7. Customer Lifetime Value (LTV) 8. Churn Rate 9. Unit
See More
Aditya
I am > I was .ย โขย 12d
Day 13 of my 30-day Business & Entrepreneurship series . Building and testing your product is one thing โ but knowing if your business is healthy is another. Thatโs where metrics like CAC, LTV, Churn, and Retention come in. ๐ Hereโs the breakdown
See More
Download the medial app to read full posts, comements and news.