Wed, 7 July 2021
Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.
In analyzing potential investments, it’s important to understand their business model and how well it meets the venture investors’ requirements.
The business model consists of unit and customer acquisition economics as well as market and business economics.
Unit economics is the cost to provide a product that drives gross margin.
This determines how much revenue is left to cover the business expenses.
In general, 40% gross margin should be the floor.
Customer acquisition economics is the cost of acquiring a customer which drives scalability.
This determines how much you have to spend to grow sales.
In general, your cost of customer acquisition should be ⅓ or less than your average customer revenue.
Market economics is the cost of penetrating a market which will drive fundraising requirements.
This determines how much funding you have to raise to capture a portion of the market.
You must show a growth rate of at least 50% year over year to continue raising funding.
Business economics is the cost of running the business which drives profitability.
This determines how soon you can achieve cash flow positive and no longer have to raise funding to stay alive.
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Music courtesy of Bensound
Wed, 7 July 2021
In this episode, Hall welcomes Reyn Aubrey, CEO of PocketChange.
Headquartered in Denver, Colorado, PocketChange is a social media platform created to reverse the chaos created by social media 1.0. They do many things differently, including paying for a donation to charity every time someone posts, likes, or comments on something on the platform. They have reworked content moderation, policy, and have built a community culture that is good. They have launched their platform and have already raised money for angel investors and received press and influencer attention.
Their content moderation has been rebuilt from the ground up to deal with their current divisive social climate. Best of all, the community is filled with people who believe that social media can be better than what it is today.
"Society is more divided, more hateful, and more fed up and frustrated than ever before. Social media 1.0 accelerated this mess, and social media 2.0 can get us out of it." ….Reyn Aubry.
Reyn was named one of the top 25 innovators in Colorado, and his previous consumer products company outsold Walmart and Target in his home state. Now Reyn has shifted his focus to building a massive company that rights the wrongs of social media 1.0, and in the process makes society a better place.
Reyn is part of the next generation of leaders building the future of social platforms.
He currently resides in Denver full-time.
Reyn discusses the state of investing in social media, some of the challenges startups face, and some of his plans for PocketChange.
Music courtesy of Bensound.