β Glossary
Unit Economics
The direct revenues and costs associated with a particular business model expressed on a per-unit basis.
Unit economics answers: 'Do you make money on each transaction/customer?' The two key metrics: CAC (Customer Acquisition Cost) β how much you spend to get one customer, and LTV (Lifetime Value) β how much revenue one customer generates over their lifetime. Healthy SaaS: LTV/CAC ratio of 3:1 or higher. If your LTV/CAC is below 1:1, you're literally paying people to lose money. Fix unit economics before scaling β growth amplifies both profits and losses.