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by username223
3379 days ago
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Isn't this just restating what I wrote in VC-speak? > The biggest thing with the subscription is clear [Customer Acquisition Cost] vs. [Long Term Value]. i.e. "recurring billing results in more people failing to cancel, because they either forget or are deterred by our 'customer retention program.'" > With our current model this equation works and we can profitably acquire new customers. i.e. "we wouldn't be able to profit and grow without doing this." It seems like you genuinely care about good coffee, but what's the desired end-state? If it's "great instant coffee at $1/cup with no auto-billing," that makes sense. If it involves negative option billing, it's shameful. |
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No, it's not what you said. Your explanation misses the segment of customers that want the product every month but wouldn't exert a manual effort over and over again when it could be automated. Hence an increased LTV per customer with no change to the CAC. This doesn't really have anything to do with Sudden but rather subscription business economics. Automatic billing is not inherently bad; it's largely positive and convenient.
Also remember this company is not random — there's a ton of diligence involved with getting into YC as well as with VCs which they are backed.