Freemium Business Model NotesOriginal filename: freemium model 1-2.xls General Notes This model provides a base template for modeling out a freemium web services business It uses a "cohort" approach and allows you to model churn and conversion behavior for monthly cohorts. The model works off of a concept of "active users" - i.e. someone who is coming to your site at least once to use system that month This has a simple user acquisition / growth approach; you can swap in a more complicated user growth model at the top that accounts for virality or marketing spend -- I only encourage you to model user growth from the bottom up. If you are modeling out microtransactions / vgoods, I suggest breaking out different user types and cross-checking against industry ARPU and ARPPU rates Feel free to use the model however you want -- I hope it is helpful to your efforts. If you spot a bug, let me know! ([email protected])
Notes on Assumptions and Inputs Many of the inputs in the model have been zero-ed out so you can enter your own assumptions w/o distraction User growth is at top of Model tab; cohort behavior at top of Assumptions tab Other assumptions are spread across the Model, Assumptions, and Staff tabs (depending on whether static or change over time) Hard-coded inputs are blue
Original model template created by Giff Constable, 2009 -- http://giffconstable.com
83014661.xlsx
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Confidential
Financial Summary2010 Registered Users (FYE) Active Users (FYE) Subscribers (FYE) Subscriber Ratio (FYE) Revenue Subscriptions Advertising / Affiliate Total Revenue Cost of Revenues Gross ProfitGross Margin
2011 715,188 334,475 3,197 1%
2012 3,178,669 979,648 40,414 4%
2013 6,974,996 1,845,493 126,009 7%
100 100 0 0%
0 0 0 0 00%
0 0 0 0 00%
0 0 0 0 00%
0 0 0 0 00%
Technology Sales & Marketing General & Administrative Total Operating Costs EBITDAEBITDA Margin
0 0 32,880 32,880 (32,880)0%
0 0% 0 0% 72,880 100% 72,880 (72,880)0%
0 0% 0 0% 132,880 100% 132,880 (132,880)0%
0 0% 0 0% 152,880 100% 152,880 (152,880)0%
FYE Headcount (incl. contractors) Corp Technology Sales & Marketing Customer Support Total
2010 1.0 3.5 0.0 0.0 4.5
2011 1.0 3.5 0.0 0.0 4.5
2012 1.0 3.5 0.0 0.0 4.5
2013 1.0 3.5 0.0 0.0 4.5
Note: an "active user" is someone who logs in that month Note: FYE = fiscal year end; numbers represent the last month of the 12 month period Note: percentages next to operating costs show percent of total costs Note: headcount show end-of-year numbers, including part-time contractors
83014661.xlsx
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ModelMilestones Start Jan-101
Feb-102
Mar-103
Apr-104
May-105
Open Beta Jun-106
Jul-107
Aug-108
Sep-109
Oct-1010
Nov-1011
Dec-1012
Jan-1113
Feb-1114
User Growth Adjustment
100%
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