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Even if the $6/customer is recurring revenue, you need to retain every customer for 4+ years to make back your CAC. So with costs of $65k/mth and revenue of $2

Even if the $6/customer is recurring revenue, you need to retain every customer for 4+ years to make back your CAC. So with costs of $65k/mth and revenue of $20k/mth you are going backwards at $45k/mth. But you say your burn rate is $500k/mth. Which suggests that there is a further $455k/mth being burnt on whatever. I just don't see how you'll ever become cash-flow positive. Based on your numbers, I'm guessing you have about 40k customers. Even by the most optimistic estimates you need over 1 million retained customers to break even. To get there you will need to invest a further $20M based on your CAC. Sorry, the numbers just don't make sense. Of course, I could be reading stuff between the lines that is wildly incorrect. But for me it is red flags all around.

youngelderly 2y ago
> But you say your burn rate is $500k/mth. Which suggests that there is a further $455k/mth being burnt on whatever. I just don't see how you'll ever become cash-flow positive. $455k/month is allocated to salaries, software's, and office expenses. > Based on your numbers, I'm guessing you have about 40k customers Every month, we acquire approximately 3,500 new customers. Our retention of existing customers is low due to the nature of our marketplace, which has low-frequency usage. Edit/Fix: 3,500/Month -- not week, sorry :-(
- GianFabien 2y ago
  Thanks for the additional data. With low retention, the situation looks even more dire. I understand the outgoing for salaries, software, office expenses. But in overall business terms all of those, too, need to be supported by the revenue generated. A viable business is one that sustains all its expenses and has a surplus to be re-invested. From the data so far, I'm guessing that it is unlikely to ever happen. Thus the suggestion that your gut feelings are spot on and it might be an idea to move on.

youngelderly 2y ago

> But you say your burn rate is $500k/mth. Which suggests that there is a further $455k/mth being burnt on whatever. I just don't see how you'll ever become cash-flow positive. $455k/month is allocated to salaries, software's, and office expenses. > Based on your numbers, I'm guessing you have about 40k customers Every month, we acquire approximately 3,500 new customers. Our retention of existing customers is low due to the nature of our marketplace, which has low-frequency usage. Edit/Fix: 3,500/Month -- not week, sorry :-(

GianFabien 2y ago
Thanks for the additional data. With low retention, the situation looks even more dire. I understand the outgoing for salaries, software, office expenses. But in overall business terms all of those, too, need to be supported by the revenue generated. A viable business is one that sustains all its expenses and has a surplus to be re-invested. From the data so far, I'm guessing that it is unlikely to ever happen. Thus the suggestion that your gut feelings are spot on and it might be an idea to move on.