Unit Economics

The revenue and cost of a single unit of your business, usually one customer, boiled down to whether that unit makes or loses money. CAC, LTV, and margin all feed into it.

Why it matters

A business with broken unit economics gets worse as it grows, not better. Proving that one customer is profitable, before you pour money into acquiring millions, is how you tell a real business from a subsidised one.

Related terms

Customer Acquisition Cost Lifetime Value CAC Payback Period
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