Tools

Unit economics calculator

This business design tool will help you guesstimate whether your business model will be profitable and sustainable by analyzing your unit economics.

What is this for?

The unit economics calculator will help you figure out whether your product or service will actually be profitable once marketing and other efforts are taken into account.

Use it to work out how much it costs to produce, market, and acquire a customer per individual unit of your proposed product or service.

It will force you to make some concrete assumptions about numbers that you might not know yet. And it will help you align as a team and evaluate the basis of your business model.

Keep adjusting the numbers as you (in)validate your assumptions.

Step-by-step guide

Step 1

Individually review the unit economics calculator and write down in words what figures you need to know to calculate a guesstimate for your business model.

Step 2

As a team, compare your findings and agree on a formula (in words).

Step 3

Divide tasks and try to turn words into numbers. If you don’t have direct estimates as to the right numbers, use a benchmark or make an educated guess, but make sure the underlying assumptions are explicit.