EVALUATOR
Unit Economics Truth
Does one customer create real contribution — or hide loss behind aggregation?
If one unit loses money, growth compounds the damage.
Unit creates durable contribution
Contribution unclear under variance
One unit destroys value
This evaluator tests
- Contribution margin
- Founder labour reality
- Revenue quality
- Cost visibility
This evaluator does not do
- Pricing strategy
- Margin optimisation
- Cost reduction tactics
- Narrative justification
Step 1
Define the unit
Force one atomic unit so blended economics cannot hide failure.
Step 2
Establish realised revenue
Strip discounts, refunds, credits, and non-cash adjustments.
Step 3
Decompose variable cost
Price all delivery, support, infrastructure, and founder labour.
Step 4
Stress-test contribution
Check whether margin survives realistic best and worst variance.
Step 5
Re-evaluate under variance
Confirm the unit remains auditable and repeatable under deviation.
Tools
Operator stack
Margin Variance Stress
Stress-tests contribution margin across observed best and worst variance.
Net Realised Revenue Evidence
Strips discounts, credits, refunds, and non-cash adjustments from revenue.
True Variable Cost Decomposition
Builds a complete, auditable breakdown of direct unit costs.
PROFITBOOKS SYSTEM
Unit Economics → Cash → Profit
If one breaks, everything above misleads
If you lose money per customer, growth makes it worse
If margins are hidden, your business model is unclear
If contribution isn’t positive, you do not have a business
If one unit does not create value, scale will deepen the loss.
Related tools
Cash Reality & Runway
After unit economics, test whether cash timing lets the business survive. Review Cash Reality & Runway.
Scale & Profit Durability
After margin is proven, test whether it survives scale and complexity. Review Scale & Profit Durability.
From the knowledge base
Read the failure pattern behind silent margin erosion. Read: Why Unit Economics Break Before Growth Stalls.