Unit Economics for Startups | eCommerce, Software & Hardware

[@eric_andrews]

Questions? Let me know in the comments happy to discuss. 🚀Also, if you want to learn how to systematically scale your startup without ending up as one of the 90% of startups that fail, check out my free training webinar ⇒ www.ericandrewsstartups.com/financeforstartups

[@muhy1981]

Avery time I see a new video of yours, I am amazed. Thank you for this

[@eric_andrews]

You are very welcome!

[@thetanuagrawal]

The best channel on this earth, lots of love from India.

[@eric_andrews]

You are too kind🙏

[@nasnattamkar8527]

🇮🇳

[@conradoandreatta6914]

Very helpful, at the moment im trying to build up the company, and I consider this of paramount importance. Thanks mate

[@eric_andrews]

Very welcome, cheers!

[@darrensapalo]

Thanks for walking us through the numbers.

[@AThakker29]

Very simply explained. Thanks so much!

[@eric_andrews]

You got it!

[@sumantadass]

Thank you so much. Very Helpfull Video .. .. . .

[@ajeet.y]

This is great stuff, this helped me solving a business case study

[@eric_andrews]

that's great to hear!

[@ahmedrazamughal]

Great insight thanks

[@babacarkane1027]

Very well explained. Thanks for sharing

[@eric_andrews]

Glad it was helpful!

[@himanshitripathi6734]

Wowww.......the explanation is just so amazing

[@eric_andrews]

🙌

[@thecyberlord]

I have been new to this startup world and this information is great. I would like to ask only one thing where should i start learning from your playlists. All the information looks so tempting. Amazing video.

[@eric_andrews]

Glad to hear it! I would start with the startup founder series playlist as that will give you a very broad overview of all the most important dimensions of startups. The advanced modeling for analysts goes a lot deeper on technical financial modeling and analysis which may or may not be valuable to you depending on what your focus is. Enjoy! Startup founder series: kzbin.info/aero/PLdoBuNNnCmdVx_-h9ePRdP_3UGDPKvN12

[@thecyberlord]

@@eric_andrews Thank you

[@siamakfarjami2116]

Hi Eric, great content, thank you

[@eric_andrews]

You're very welcome!

[@aisyahaisyah3564]

Absolute gold! Thank u so much

[@eric_andrews]

My pleasure!

[@KatrinaLainsbury]

SO HELPFULL!!

[@robertvanderbailes1295]

Very clear and helpful

[@eric_andrews]

Glad to hear that!

[@oriehi_raphael_paul]

Great video!

[@zgidwitz]

Thank you!

[@gwwyl]

Great content! Thank you

[@eric_andrews]

Cheers garry happy to help!

[@MoneyFold]

Amazing videos, many thanks 😊 🙏

[@eric_andrews]

My pleasure!

[@닝닝닝]

Thanks it's very helpful

[@amiral-arnaouti4662]

Great video!

[@eric_andrews]

My pleasure !!

[@gungunaremusic5988]

Thanks for your valuable video

[@aziz6691]

Hi Eric, why not include the operational expenses in the COGS? Like the salaries of the engineers, sales and generally all the employees. Thank you so much for this!

[@eric_andrews]

From a unit economics standpoint, we are focused on direct costs, not indirect costs (opex). That means costs where if you sell 1 additional unit, all of the direct costs also increase 1 for 1. If you sell 10 additional units tomorrow, there will be a CAC on each unit and direct costs will also increase for each unit. Will you need 10 addition units of an engineer's salary? No. So the idea is that you need to make money on your gross profit - CAC at the unit level, and only then do you have a chance to pay for all your indirect costs. If you don't make a profit in your unit economics, you'll never make enough profit to pay all your employees and still have additional money left over.

[@SimonCurrey]

Excellent video. I am hoping the template arrives. We are a content platform and need to get our heads around our users economic value. Especially early authors. Who may need to invest £10K of their time. However, they get a payback.

[@eric_andrews]

Sometimes it takes 5-10 minutes to send, good luck with your startup!

[@MarkAlex]

Hi Eric, could you please help in preparation of startup business plan and financial model for the purpose of presenting them to VC and angel investors?

[@stephanorose4385]

Do you have a sample of that spreadsheet @Eric Andrews?

[@eric_andrews]

Yes right there in the description it's available to download for free :)

[@zr246]

Can you do a tutorial on Data As A Service for example Planet Labs the space company which sells data and leverages that as a financial moat

[@eric_andrews]

I'll put it on my content list, thanks for the idea!

[@zr246]

@@eric_andrews bless you mate!

[@M-um2vf]

Hi Eric, Do you have this spreadsheet available as a google sheet?

[@eric_andrews]

Just download the Excel, drop into a google drive, and open as a google sheet

[@ШумшатМухтаровна]

「もっと多くの人が必要なので、このビデオをもっと

[@masoodhussain1967]

thumbs up from pk :)

[@gajanangunjal2878]

So unit econimics is calualted for one cusomter. but this unit economics is also average of all the customer & considered as one customer. Am i correct?

[@eric_andrews]

Yes exactly

[@SP-bw3zp]

good

[@eric_andrews]

Glad it was helpful!

[@DesigningWithLaura]

Where do you put OPEX when it's for SaaS

[@eric_andrews]

Good question. The only OPEX included in unit economics are sales & marketing. The reason is because unit economics is focused on what costs are associated with each UNIT sold, so the regular fixed costs in OPEX generally won't fluctuate whether we sell 5 vs. 50 units, so we exclude them for this type of analysis.

[@kacperjurasz5142]

Great content Andrew. I ve been watching you for a while now and right now I am trying to land a startup financial analyst job in Berlin. Would you be interested in 1 on 1 consultations? Thanks!

[@eric_andrews]

Hi, thanks for the message. Apologies that I'm not available for 1-1 with my schedule but my next Finance for Startups cohort would probably be valuable for you, and we do a lot of livestreams in it where I do open Q&A. If not just make sure you watch my 3 statement financial model video, one of the startup financial models like the marketplace, the DCF model, and the interview prep stuff and you should be pretty prepared 👍

[@kacperjurasz5142]

@@eric_andrews I have been through your videos and I have made it to the second round of recruitment, but then I got a case study to solve. I had to make 5 year forecast with detailed revenue build using provided BS, PnL, Sales and head count and unfortunately I didnt pass that stage. I hope I will be able to join the next cohort and ask about it then!

[@eric_andrews]

@@kacperjurasz5142 Sorry to hear it but you will be 10X better for it going into your next interview...just keep learning! Anyway, hope to see you in the cohort. Cheers!

[@lavettevxoxo]

🔥🔥🔥🔥

[@stangerkd]

Wow

[@masemstorytv]

Thanks for your insight but I can't view your work , so make it bold for me