Photo by Adeolu Eletu on Unsplash
This is my personal summary/notes from a talk by Anu Hariharan, Y Combinator
These are 9 common business models for startup along with their common growth metrics:
- Enterprise: selling software/service for big companies. Eg. Docker, Cloudera
- Number of bookings
- Number of unique users
- Revenue
- SaaS: software as a service. Eg. Google Suite, Sales Force
- Monthly Recurring Revenue (MRR)
- Annual Recurring Revenue (ARR)
- MRR Churn
- Paid Customer Acquisition Cost (CAC)
- Subscription: similar to SaaS but usually has lower revenue per customer. Eg. Linkedin, Netflix
- Monthly Recurring Revenue (MRR)
- MMR Compound Monthly Growth Rate (CMGR): because usually subscription revenue is smaller
- MRR Churn
- Paid CAC
- Transactional: charges a fee for each transaction. Eg. Paypal, Stripe
- Gross Transaction Volume
- Net revenue
- User Retention: cohort metric
- Paid CAC
- Marketplace: similar to transactional but usually C2C. Eg. AirBnB, eBay
- Gross Merchandise Value (GMV)
- Net Revenue
- Net Revenue CMGR: similar reason as subscription’s
- User Retention
- Paid CAC
- E-commerce: sell products online with own brand (unlike marketplace). Eg. Amazon Store
- Monthly Revenue
- Revenue CMGR
- Gross Margin
- Paid CAC
- Advertising: offer free services to customer and get revenue from advertisers. Eg. Snapchat, Twitter, Reddit
- Daily Active Users (DAU)
- Monthly Active Users (MAU)
- Percent logged-in
- Hardware: similar to e-commerce but specifically selling hardwares. Eg. Fitbit, GoPro, Xiaomi
- Monthly Revenue
- Revenue CMGR
- Gross Margin
- Paid CAC
- Usage-based: not explained/skipped. But most likely similar to Transactional