In short
The business model slide explains who pays you, how much, how often and why that is profitable. Show your main revenue streams, the price or average order value, and, if you have them, unit economics such as gross margin, customer acquisition cost (CAC) and lifetime value (LTV).
A good business model slide makes the path to profit obvious. Investors should understand in a few seconds how each customer turns into revenue.
Common startup business models
| Model | How it makes money |
|---|---|
| Subscription (SaaS) | Recurring monthly or annual fees per user, account or usage |
| Marketplace | A commission or fee on each transaction between buyers and sellers |
| Transaction or payments | A small fee or percentage on each payment processed |
| Direct to consumer | Product sales with a margin over cost of goods |
| Usage-based | Charges that rise with consumption, such as API calls |
| Licensing | Fees for the right to use technology or content |
| Advertising | Revenue from advertisers reaching your users |
What to include
- Who pays, and whether it is the same person who uses the product.
- Pricing and any tiers.
- Revenue streams, with the main one highlighted.
- Unit economics: gross margin, CAC, LTV, payback period.
- How revenue grows per customer over time, if it does.
Common mistakes
- Listing many possible revenue streams without saying which one works today.
- ‘We will monetise later’ for a consumer product, with no plan.
- Ignoring delivery costs, payment fees or returns.
Frequently asked questions
What is a good LTV to CAC ratio?
A ratio of around 3:1 is often quoted as healthy for subscription businesses, but it varies by sector and stage. Show how your ratio is calculated and how it is improving.
Written by Gachi Foundation, a non-profit in Jharkhand, India. All pitch deck resources.