Canaree

John Brett

Those tricky finance abbreviations and fundraising lingo explained 

Unit economics are the P&L of a business reduced to a per unit basis. A unit is the fundamental driver of your business model.

CAC payback is the number of months it takes to pay off the cost of acquiring a customer and to start making a profit from that customer.

LTV:CAC ratio is a measure of profitability per customer.

The average revenue per unit/user/customer per month.

Lifetime value (LTV) is the profit that you generate over the life of your customer's relationship with your business.

Customer acquisition cost (CAC) is the amount of money that you spend on sales and marketing to acquire a customer.

Churn rate is a measure of the number of individuals or items moving out of a collective group over a specific period

Describes the company's price before and after an investment

The point in time where cash exceeds the initial investment value

Break-even is the point of balance where your business is making neither a profit nor a loss.

Monthly Recurring Revenue is revenue that is likely to continue to be generated regularly for a significant period of time

Annual Recurring Revenue is revenue that is likely to continue to be generated regularly for a significant period of time

Burn rate is the company's total expenses and team costs as monthly average.

Runway describes how many months you have left where you’re able to cover all your costs.

Revenue is the income that a business has from its normal business activities, usually from the sale of goods and services,

Gross margin is a company's net sales revenue minus its cost of goods sold (COGS)

Cost of Goods Sold refers to the direct costs of producing the goods sold by a company.