What are unit economics?
Unit economics is the financial picture of a single transaction or customer relationship in your business. It tells you whether a single sale is profitable, how much it costs to acquire that sale, and how long it takes to recoup that cost. Strong unit economics is the foundation that lets a business scale without burning capital.
Who this is for and when to use it
African founders preparing for a fundraise, operators trying to understand why growth is not improving profitability, and product teams pricing a new offering. Use the workbook before scaling marketing spend, before raising a round (investors will ask), when comparing customer segments, after a pricing change, and as a quarterly health check.
What is inside
A written guide that explains each metric with formulas and examples, the difference between gross and contribution margin, and the most common mistakes founders make, plus an editable spreadsheet that calculates CAC, LTV, payback period, the LTV/CAC ratio, and contribution margin from your inputs. Pair with The Unit Economics Guide for the full narrative explanation.
Key concepts you will learn
Customer Acquisition Cost (CAC) and how to calculate it correctly, Lifetime Value (LTV) and the difference between gross-margin LTV and revenue LTV, the LTV to CAC ratio (3x is the rough target), payback period (12 to 18 months is healthy for most businesses), contribution margin per unit, the link between churn and LTV, and cohort analysis.