Simplified Growth Model (Transactional)

	A	D	E	F	G	H	I	J	K	L	M	N	O	P	Q	R	S	T	U	V	W	X	Y	Z	AA	AB	AC
1		From: Why Growth Models Fail
2		Assumptions						Baseline Outputs (Year 1-2)					Baseline vs. Scenario (Year 1)
3		Category	Metric	Baseline	Scenario 1	Delta		Metric	Year 1	Year 2	Y/Y		Metric	Baseline	Scenario 1	Delta
4		ACQUISITION	Monthly Marketing Spend	$25,000	$25,000	0%		Marketing Spend	$354,801	$505,861	43%		Marketing Spend	$354,801	$354,801	0%
5			Monthly Spend Growth Rate	3%	3%	0%		Total Signups	69,950	130,230	86%		Total Signups	69,950	78,921	13%
6			Cost per Click	$2.00	$2.00	0%
7			Referred Visitors per Active Customer	1.00	1.60	60%		Paid CAC	$13	$13	0%		Paid CAC	$13	$13	0%
8			Incentive per Referral	$5	$5	0%		Blended CAC	$5	$4	-23%		Blended CAC	$5	$4	-11%
9			Direct Visitors - M1	10,000	10,000	0%
10			Direct Monthly Growth Rate	5%	5%	0%		Monthly Active Customers	53,819	149,715	178%		Monthly Active Customers	53,819	60,290	12%
11			Paid Conversion Rate	15%	15%	0%		Monthly Transactions	86,110	239,545	178%		Monthly Transactions	86,110	96,464	12%
12			Viral Conversion Rate	25%	25%	0%
13			Direct Conversion Rate	20%	20%	0%		Revenue	$4,305,512	$11,977,234	178%		Revenue	$4,305,512	$4,823,206	12%
14		ACTIVATION & RETENTION	Paid Activation Rate	20%	20%	0%		AOV	$50	$50	0%		AOV	$50	$50	0%
15			Direct Activation Rate	40%	40%	0%
16			Viral Activation Rate	35%	35%	0%		Contribution Margin	$986,963	$3,211,138	225%		Contribution Margin	$986,963	$1,110,358	13%
17			Retention Rate - M2	40%	40%	0%		Contribution Margin %	23%	27%	17%		Contribution Margin %	23%	23%	0%
18			Retention Rate - M3	37%	37%	0%
19			Retention Rate - M4	34%	34%	0%
20			Retention Rate - M5	31%	31%	0%
21			Retention Rate - M6	29%	29%	0%
22			Retention Rate - M7	26%	26%	0%
23			Retention Rate - M8	24%	24%	0%
24			Retention Rate - M9	22%	22%	0%
25			Retention Rate - M10	21%	21%	0%
26			Retention Rate - M11	19%	19%	0%
27			Retention Rate - M12	17%	17%	0%
28			Monthly Churn - M13+	1.00%	1.00%	0%
29			Monthly cohort retention degredation	1.00%	1.00%	0%
30		MONETIZATION & COSTS	Average Order Value	$50	$50	0%
31			Monthly Transactions per Active	1.6	1.6	0%
32			COGS	$25	$25	0%
33			Avg. Shipping Cost per Order	$9	$9	0%
34			Processing Cost (%)	3%	3%	0%
35			Customer Support $ per Active	$3	$3	0%
36			Monthly Salaries	$60,000	$60,000	0%
37			Spend growth rate	3%	3%	0%
38			Monthly Overhead	$15,000	$15,000	0%
39			Spend Growth Rate	3%	3%	0%
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84	CHART DATA
85
86	Revenue	Month 1	Month 2	Month 3	Month 4		Month 5	Month 6	Month 7	Month 8		Month 9	Month 10	Month 11	Month 12	Month 13	Month 14	Month 15	Month 16	Month 17	Month 18	Month 19	Month 20	Month 21	Month 22	Month 23	Month 24
87	Baseline	$94,000	$143,925	$191,677	$239,279		$286,869	$334,495	$382,205	$430,046		$478,068	$526,324	$574,868	$623,755	$674,186	$726,356	$780,356	$836,270	$894,180	$954,169	$1,016,321	$1,080,717	$1,147,442	$1,216,580	$1,288,217	$1,362,440
88	Scenario	$94,000	$148,860	$201,878	$255,802		$310,833	$366,988	$424,271	$482,687		$542,243	$602,950	$664,821	$727,872	$793,265	$861,274	$932,035	$1,005,664	$1,082,276	$1,161,987	$1,244,910	$1,331,160	$1,420,853	$1,514,104	$1,611,028	$1,711,742
89
90	Monthly Active Customers	Month 1	Month 2	Month 3	Month 4		Month 5	Month 6	Month 7	Month 8		Month 9	Month 10	Month 11	Month 12	Month 13	Month 14	Month 15	Month 16	Month 17	Month 18	Month 19	Month 20	Month 21	Month 22	Month 23	Month 24
91	Baseline	1,175	1,799	2,396	2,991		3,586	4,181	4,778	5,376		5,976	6,579	7,186	7,797	8,427	9,079	9,754	10,453	11,177	11,927	12,704	13,509	14,343	15,207	16,103	17,031
92	Scenario	1,175	1,861	2,523	3,198		3,885	4,587	5,303	6,034		6,778	7,537	8,310	9,098	9,916	10,766	11,650	12,571	13,528	14,525	15,561	16,640	17,761	18,926	20,138	21,397
93
94
95
96
97
98
99
100