The Startup Story

Burn rate is the measure of net cash, a company lost in a period, usually a month.

Burn = Expenses - Cash inflow

Burn multiple is the ratio of revenue earned and the amount of money burned to earn that revenue.

The viral coefficient helps to quantify the extent to which a product reaches a maximum number of people by making minimum spending on marketing activities may be happening. Businesses often run referral campaigns to effect a high virality of the product and achieve a high virality coefficient.

Here you will get to know how to get to your exact audiences.

“Half of my advertising spend is wasted, the trouble is, I don’t know which half.”

Here we discuss the wholesome effects of branding on a startup.

Performance marketing, though, is about selling your product or acquiring paid users. The metric which measures this “performance” is called the Return on Ad Spend or ROAS.

While CAC is the ad spent on acquiring a customer, there may be further costs incurred by the company to retain the customers over the duration they are associated with the brand.

It is a specific ratio that determines how many people have been onboarded to the platform organically.

Here we have discussed how the actual CAC is calculated for startups. Considering all the marketing channels.

let’s say 10,00,000 users saw the ad, 10% of those users, i.e., 1,00,000 users clicked on the ad. A further 20% or 20,000 users checked out the product and registered on it. With an ad spend of ₹2,00,000, the product acquired 20,000 new customers.

So, CAC for Facebook ads = ₹2,00,000 / 20,000 = ₹10. 

Similarly, you can calculate the CAC for. Instagram & Google ads.

Blended CAC = total spend on user acquisition across channels/total users acquired from all the channels.

Cashback is a trendy way to attract new users. Companies understand that the average Indian customer loves freebies. From a fairly business perspective, cashback is similar to a discount. But they too are subject to interpretation and depend on their source.