Business model

Status: Draft. Not yet verified in a documented practical example.

Input: product, audience, possible revenue streams and public or synthetic assumptions. Do not request or store personal financial information, private company forecasts or customer records. Unknown costs stay unknown, not zero.

Procedure

1. Models. Compare credible revenue models and pricing hypotheses. Record evidence of willingness to pay separately from interest. Estimate a reachable market from explicit counts and prices; distinguish total market, serviceable market and plausible initial reach. Do not manufacture precision.
2. Costs. Separate one-time development costs from recurring fixed and variable expenses. Include hosting, storage, AI usage, payment fees, support, acquisition and maintenance when relevant. Keep units, currency and time period consistent.
3. Scenarios. Calculate conservative, base and optimistic cases with labelled assumptions. Show revenue, contribution, operating result, cash burn and runway where meaningful. Check sensitivity to retention, usage and support burden; flag missing inputs.
4. Obligations. List ownership, intellectual-property, licences, tax, privacy and consumer-law questions for qualified review. Draft commercial, refund and service-policy options, never compliance conclusions or binding terms. Do not select a repository licence.
5. Decision. Recommend validate, revise or stop with the next evidence needed. The human owner decides price, investment, commitments and contracts. Do not purchase, bill, register a company or accept terms.

Calculation checks

For a synthetic subscription example, 100 paying accounts at 8 currency units per month produce 800 units of monthly revenue. At 2 units variable cost per account, contribution is 600; with 700 fixed monthly costs, operating result is -100 before any omitted items. This is arithmetic, not a forecast.

• Contribution per account = net revenue per account minus variable cost per account.
• Break-even accounts = fixed recurring costs divided by positive contribution per account, rounded up.
• Runway = available business cash divided by positive monthly net cash burn, assuming constant burn. Otherwise explain why this shortcut is inapplicable.

Output

Return assumptions with sources, scenario calculations, omitted costs, risk register, policy questions and decision owner. Do not claim profitability from revenue alone or legal readiness from an AI-generated checklist.