Wednesday, November 25, 2009
Onstartups - Dharmesh Shah
Recently I came across this amazing blog from Dharmesh Shah [http://onstartups.com]. It is simply an awesome knowledge base on experiences in and around startups from Dharmesh. Dharmesh recently gave a session [Insights from and around MIT] and I would strongly recommend it.
I found following two parameters from his talks/blogs pretty interesting:
1. COCA - Cost Of Customer Acquisition - This is the cost/expense involved in acquiring a new customer.
2. LTV - Life Time Value (of a customer) - This is the revenue made from an acquired customer.
As long as your LTV > COCA means you have potential to make profit.
I found following two parameters from his talks/blogs pretty interesting:
1. COCA - Cost Of Customer Acquisition - This is the cost/expense involved in acquiring a new customer.
2. LTV - Life Time Value (of a customer) - This is the revenue made from an acquired customer.
As long as your LTV > COCA means you have potential to make profit.
# posted by Paresh Borkar @ 6:24 AM 
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Glad you like the blog. Thanks for the kind words.
One quick note: Just because LTV > COCA, doesn't not mean you're making a profit (because the revenues from the customer actually show up over time).
But, it does create the *potential* for profit, and it's a good thing.
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One quick note: Just because LTV > COCA, doesn't not mean you're making a profit (because the revenues from the customer actually show up over time).
But, it does create the *potential* for profit, and it's a good thing.
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