Four numbers. Estimates are fine for the last two.
Capture
A subscriber pays back what they cost in
2.9 months
They are worth $23 over a year, against $6 to acquire.
Show me where the revenue isThe first year is not twelve months of value
A subscriber who arrives in January earns for twelve months of this year. One arriving in December earns for one. The usual mistake counts a year of acquisition as a full year of value each.
Done month by month, this year’s acquisition earns $207,480. The naive figure is $383,040, which overstates it by 1.8x.
| Over twelve months | Revenue | Spend | Net |
|---|---|---|---|
| This year’s intake | $207,480 | $92,400 | $115,080 |
| Same people, next year | $383,040 | $0 | $383,040 |
This pays for itself inside the year
You spend $7,700 a month and return 2.2x on it in the first twelve months. Every year after that, the same people cost nothing and keep earning.
A year of this adds 27% to the list you have today, before anyone leaves.
Everything here runs in your browser. Your numbers are never sent anywhere, not to me and not to anyone else.
How this is calculated, and what to put in
The mistake this avoids
Almost every version of this multiplies a year of acquisition by a year of value. That counts revenue nobody has earned yet.
A subscriber who arrives in January earns for twelve months of this year. One arriving in December earns for one. Summed month by month, the real figure is about half of the naive one.
The tool shows both, and the gap between them. The naive number is the one most people carry in their head.
Why the second year matters more
Subscribers acquired this year cost nothing next year and keep earning. That second row on the table is where list building pays.
It also depends entirely on whether they stay. That is why this tool pairs with the frequency one. Growth tells you the fill rate. Frequency tells you the leak.
What to put in
- Revenue one subscriber produces a month
- Total revenue from email and text in a month, divided by list size. Rough is fine. Being out by a few cents does not change the decision this informs.
- Cost to acquire one
- Everything spent on getting subscribers, divided by how many arrived. Leave it at zero if growth is entirely organic. The payback figure then reads as immediate.
What to do with the answer
If payback is short, acquisition is not your constraint. Spending more on it is a reasonable move.
If payback runs past a year, more acquisition makes the problem bigger rather than smaller. Fix what happens after someone subscribes first, then come back to this.