What are Unit Economics? | Gregory Shepard | Minute Mentor

So unit economics. First of all, what are unit economics? Basically what it does is it dissects what it is that you're doing and it breaks it down to its smallest elements, the units, to make sure that on a unit level it scales out the way that it looks in the model. You need to make sure you do unit economics, but you don't necessarily need to do them straight away. A lot of people will tell you to do them, but it's, It's really, it's kind of a not a logical exercise because you don't have enough data yet to understand whether it's going to scale and therefore you don't have the right numbers and you're gonna be off on your unit economics. So it's really important to do them. Maybe you could do them later and you break that down by all of the different elements that are included into that. So your customer acquisition cost is more a sales and marketing KPI, and the lifetime value, as an example, is more of a service delivery or sales and service KPI because it's attached to retention. How long do you have the customer? And unit economics are more of an operational function so that you can look at the business from a financial perspective and say all of the different units costs that are included in making one individual product all add up and equal a profit. So, they're different, right? So, one of them is specifically focused on the measurement of success in sales and marketing, and the other one is on service delivery. And then you have overall, what is the profit on a unit that you create? I hope that's helpful.