gh-lyndonkl-claude/skills/financial-unit-economics/resources/template.md

Financial Unit Economics Templates

Quick-start templates for calculating CAC, LTV, contribution margin, and cohort analysis.

Unit Definition Template

Business model: [Subscription / Transactional / Marketplace / Freemium / Enterprise]

Unit of analysis: [What are you measuring?]

• Customer (entire relationship)
• Subscription (per subscription period)
• Transaction (per purchase)
• Product SKU (per product sold)
• User (active user)

Time period: [Monthly / Quarterly / Annual cohorts]

Segments (if analyzing by segment):

• Acquisition channel (paid search, organic, referral, etc.)
• Customer type (B2B vs B2C, SMB vs Enterprise)
• Geography (US, EU, APAC)
• Product tier (Free, Pro, Enterprise)

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CAC Calculation Template

Customer Acquisition Cost (CAC) = Total acquisition costs ÷ New customers acquired

Fully-Loaded CAC

Sales & Marketing Costs (period: [Month/Quarter/Year])

Cost Category	Amount	Notes
Marketing spend	$[X]	Paid ads, content marketing, events, tools
Sales team salaries	$[X]	Base + commission + benefits
Sales tools & software	$[X]	CRM, sales engagement, analytics
Marketing team salaries	$[X]	Marketers, designers, contractors
Overhead allocation	$[X]	% of office, admin costs attributable to S&M
Other	$[X]	[Specify]
Total S&M Cost	$[X]	Sum of above

New customers acquired (same period): [N]

CAC = $[Total Cost] ÷ [N customers] = $[CAC per customer]

CAC by Channel

Break down CAC by acquisition channel to identify most/least efficient channels.

Channel	S&M Spend	New Customers	CAC	Notes
Paid Search	$[X]	[N]	$[X/N]	[Google Ads, Bing]
Paid Social	$[X]	[N]	$[X/N]	[Facebook, LinkedIn, etc.]
Content/SEO	$[X]	[N]	$[X/N]	[Organic, blog, SEO tools]
Referral	$[X]	[N]	$[X/N]	[Referral program costs]
Direct	$[X]	[N]	$[X/N]	[Type-in, brand awareness]
Other	$[X]	[N]	$[X/N]	[Specify]
Total	$[X]	[N]	$[Blended CAC]	Fully-loaded blended CAC

Insight: [Which channels are most/least efficient? Where to increase/decrease spend?]

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LTV Calculation Template

Lifetime Value (LTV) = Revenue over customer lifetime × Gross margin %

Choose calculation method based on business model:

LTV (Subscription Model)

LTV = ARPU × Gross Margin % ÷ Monthly Churn Rate

Inputs:

• ARPU (Average Revenue Per User): $[X]/month
• Gross Margin %: [X]% (Revenue - COGS) ÷ Revenue
• Monthly Churn Rate: [X]% (customers lost ÷ starting customers)

Calculation:

• Customer Lifetime = 1 ÷ Churn Rate = 1 ÷ [X]% = [Y] months
• LTV = $[ARPU] × [Y months] × [Gross Margin %] = $[LTV]

LTV (Transactional Model)

LTV = AOV × Purchase Frequency × Gross Margin % × Customer Lifetime (years)

Inputs:

• AOV (Average Order Value): $[X] per transaction
• Purchase Frequency: [Y] purchases/year
• Gross Margin %: [Z]%
• Customer Lifetime: [N] years

Calculation:

• Annual Revenue per Customer = $[AOV] × [Frequency] = $[X]/year
• LTV = $[Annual Revenue] × [Lifetime years] × [Gross Margin %] = $[LTV]

LTV (Marketplace / Platform)

LTV = GMV per user × Take Rate × Gross Margin % ÷ Churn Rate

Inputs:

• GMV per user (monthly): $[X]
• Take Rate: [Y]% (platform's % of GMV)
• Gross Margin %: [Z]% (after variable costs)
• Monthly Churn Rate: [C]%

Calculation:

• Monthly Revenue per User = $[GMV] × [Take Rate] = $[X]/month
• Customer Lifetime = 1 ÷ [Churn] = [Y] months
• LTV = $[Monthly Rev] × [Lifetime] × [Gross Margin %] = $[LTV]

LTV by Cohort (Observed Retention)

More accurate: Use actual retention data from cohorts.

Example Cohort Retention Table (% of customers remaining):

Month	Cohort Jan	Cohort Feb	Cohort Mar	Average
0	100%	100%	100%	100%
1	95%	94%	96%	95%
2	88%	86%	89%	88%
3	80%	78%	82%	80%
6	65%	62%	-	64%
12	45%	-	-	45%

LTV Calculation:

• Sum: Month 0 revenue + (Month 1 retention × revenue) + (Month 2 retention × revenue) + ...
• LTV = ARPU × Gross Margin × Σ(retention %) = $[X]

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Contribution Margin Template

Contribution Margin % = (Revenue - Variable Costs) ÷ Revenue

Revenue & Variable Costs

Item	Per Unit	Notes
Revenue	$[X]	Subscription fee / Sale price / Transaction value
Variable Costs:		(costs that scale with each unit)
- COGS	$[X]	Product cost, manufacturing
- Hosting / Infrastructure	$[X]	Per-user server costs
- Payment processing	$[X]	Stripe/PayPal fees (~2-3%)
- Support	$[X]	Per-customer support time
- Shipping	$[X]	Fulfillment, delivery
- Other variable	$[X]	[Specify]
Total Variable Costs	$[Y]	Sum
Contribution Margin	$[X - Y]	Revenue - Variable Costs
Contribution Margin %	[(X-Y)/X]%	Margin as %

Interpretation:

• High margin (>60%): Strong unit economics, room for high CAC
• Medium margin (40-60%): Acceptable, need disciplined CAC management
• Low margin (<40%): Challenging, requires very efficient acquisition or high LTV

Levers to improve margin:

• Increase pricing (improve revenue per unit)
• Reduce COGS (negotiate supplier costs, economies of scale)
• Optimize infrastructure (reduce hosting costs per user)
• Automate support (reduce manual support time)
• Negotiate payment fees (lower processing costs)

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Cohort Analysis Template

Track retention, LTV, and payback by customer acquisition cohort (month, channel, segment).

Retention Cohort Table

Cohort (Month Acquired)	M0	M1	M2	M3	M6	M12	LTV	CAC	LTV/CAC	Payback (months)
Jan 2024	100%	92%	84%	78%	62%	42%	$1,200	$300	4.0	4.5
Feb 2024	100%	90%	81%	75%	60%	-	$1,150	$320	3.6	5.0
Mar 2024	100%	93%	86%	80%	65%	-	$1,300	$280	4.6	4.0
Apr 2024	100%	91%	83%	77%	-	-	$1,100	$350	3.1	5.5
Average	100%	91.5%	83.5%	77.5%	62.3%	42%	$1,188	$313	3.8	4.8

Insights:

• [Are newer cohorts performing better or worse than older cohorts?]
• [Which cohorts have best/worst retention?]
• [Is LTV improving over time?]
• [Is CAC increasing or decreasing?]

Cohort by Channel

Channel	# Customers	Avg LTV	Avg CAC	LTV/CAC	12M Retention	Payback (months)
Paid Search	500	$800	$250	3.2	35%	6.0
Organic	300	$1,500	$150	10.0	55%	3.0
Referral	200	$1,800	$100	18.0	60%	2.5
Paid Social	400	$700	$300	2.3	30%	7.0
Total	1,400	$1,050	$225	4.7	42%	5.0

Insights:

• [Best channels: Referral (high LTV, low CAC, fast payback, high retention)]
• [Worst channels: Paid Social (low LTV, high CAC, slow payback, low retention)]
• [Action: Increase referral investment, reduce or pause paid social]

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Interpretation Template

LTV/CAC Ratio Analysis

Your LTV/CAC: [X:1]

Range	Assessment	Action
<1:1	Unsustainable: Losing money on every customer	Stop growth, fix model or pivot
1:1 - 2:1	Marginal: Barely profitable	Don't scale yet, improve retention or reduce CAC
2:1 - 3:1	Acceptable: Unit economics work	Optimize before scaling
3:1 - 5:1	Good: Can profitably grow	Scale marketing spend
>5:1	Excellent: Strong economics	Aggressive scale, raise capital

Your assessment: [Based on ratio above]

Payback Period Analysis

Your Payback Period: [X] months

Range	Assessment	Cash Impact
<6 months	Excellent: Fast capital recovery	Can reinvest quickly, fuel growth
6-12 months	Good: Reasonable payback	Manageable cash needs
12-18 months	Acceptable: Slower recovery	Need patient capital
>18 months	Challenging: Long payback	High cash burn, risky

Your assessment: [Based on payback above]

Combined Decision Framework

Your Metrics	Recommendation
LTV/CAC: [X:1]	[Assessment from table above]
Payback: [Y] months	[Assessment from table above]
Gross Margin: [Z]%	[Good ≥60% (SaaS) / ≥40% (ecommerce), or needs improvement]
Overall	[Stop / Optimize / Scale / Aggressive Scale]

Recommendations

Pricing:

• [Increase price to improve margin and LTV]
• [Add premium tier for upsell]
• [Reduce price to increase conversion]
• [No change needed]

Channels:

• [Increase spend on: [channels with best LTV/CAC]]
• [Reduce or pause spend on: [channels with poor LTV/CAC]]
• [Test new channels: [suggestions]]

Retention:

• [Improve onboarding to reduce early churn]
• [Add features to increase engagement]
• [Customer success program for high-value customers]
• [Loyalty/referral program to increase repeat]

Growth:

• [Scale aggressively: Economics support growth]
• [Optimize first: Improve metrics before scaling]
• [Pause growth: Fix unit economics]

Cash & Fundraising:

• [Raise funding to fuel growth (if LTV/CAC >3:1 and payback <12 months)]
• [Focus on profitability (if LTV/CAC 2-3:1 and payback 12-18 months)]
• [Reduce burn (if LTV/CAC <2:1)]

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Quick Example: SaaS Startup

Unit: Customer (subscription)

CAC: $20k marketing, 100 customers → $200 CAC

LTV:

• ARPU: $100/month
• Gross Margin: 80%
• Monthly Churn: 5% → Lifetime = 1/0.05 = 20 months
• LTV = $100 × 20 × 80% = $1,600

Metrics:

• LTV/CAC: $1,600 / $200 = 8:1 ✓ Excellent
• Payback: $200 ÷ ($100 × 80%) = 2.5 months ✓ Excellent
• Gross Margin: 80% ✓ Strong

Recommendation: Aggressive scale. Economics are excellent (8:1 LTV/CAC, 2.5 month payback). Raise capital, increase marketing spend 2-3×, hire sales team, expand to new channels.

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Common Mistakes to Avoid

1. Not using cohort data: Don't average retention across all time periods. Recent cohorts may behave differently.
2. Excluding costs: Don't forget sales salaries, support, payment fees, refunds.
3. Vanity LTV: Don't project 5-year LTV with 1 month of data. Use observed retention only.
4. Ignoring channels: Don't blend CAC across all channels. Analyze each separately.
5. Fixed vs variable costs: Don't include fixed costs (engineering, rent) in contribution margin. Only variable costs that scale with units.
6. Not updating: Re-calculate quarterly. Unit economics change as you scale, market shifts, competition intensifies.