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When great revenue hides terrible unit economics (a startup story)

Original: A crash course in unit economics — don't learn this the painful way

May 25, 2025
8 min read
Case Study
Intermediate
A crash course in unit economics — don’t learn this the painful way

Summary

Ha Nguyen reflects on how early-stage hype masked unsustainable unit economics in a fashion startup.

Who This Is For

Founders
Product Managers
Growth Marketers

Key Takeaways

  • Learn to distinguish between lifetime revenue and actual lifetime value (which should be net profit, not total sales)
  • Calculate unit economics by measuring profitability per order or customer, factoring in all variable costs including labor
  • Ensure your LTV:CAC ratio is healthy before scaling - some marketing channels may be profitable while others aren't
  • High revenue growth and customer satisfaction can mask fundamentally broken business models
  • Always drill into contribution margins and customer churn when evaluating unit economics

Tools & Technologies

Keaton Row platform Net Promoter Score (NPS) measurement Affiliate revenue tracking systems Customer churn analysis tools

Topics Covered

startups cost-structure fashion unit-economics

Ready to dive deeper?

Read Full Article on medium.com