Unit economics

The profit or loss on a single customer, once you strip out fixed costs.

Example

$800 LTV against a $200 CAC is a 4:1 ratio — each customer pays back their acquisition cost four times over.

If unit economics are negative, growth makes things worse, not better. Scaling a loss just gets you to zero faster.

CAC (Customer Acquisition Cost) — The total sales and marketing spend to acquire one paying customer.
LTV (Lifetime Value) — The total gross profit you expect from one customer over the whole relationship.
Payback period — How long a customer takes to repay what you spent acquiring them.
Gross margin — Revenue minus the direct cost of delivering it, as a percentage of revenue.

Business models — Subscription, transaction, marketplace, usage, licence. The model shapes your margin, your sales motion and how much money you need. (12 min)
Pricing — Not what competitors charge. A statement about who you are for — and most early startups price far too low. (15 min)
What investors are actually assessing — Team, market, traction, insight, and whether the outcome can be large enough. In roughly that order, and mostly in the first ten minutes. (10 min)
Gross margin — Why software gets funded and services usually do not, and why a low-margin business cannot grow its way out of trouble. (10 min)
CAC, LTV and payback — Whether each customer makes you money — and whether growing makes things better or just makes the hole bigger, faster. (15 min)