Simple Startup Revenue Model
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Monte Carlo model for monthly startup revenue from price, users, conversion, and churn.
NOTEHow to use
Simple subscription revenue model: constant monthly leads, constant conversion, constant churn, and one average price point. For more realism, split acquisition channels, add pricing tiers, expansion revenue, and cohort-based churn.
NOTEMath note
Paying customers at month 12: starting_paid*(1-churn)^12 + new_paid_per_month*(1-(1-churn)^12)/churn. Average customers over the year is approximated as (start + month12)/2.
VARIABLEstarting_users
lognormal(2000, 600)
Starting base of potential users at month 0 (e.g., existing audience/trial users).
starting_users
VARIABLEmonthly_leads
poisson(800)
New leads/signups per month.
monthly_leads
VARIABLEconversion_rate
beta(2, 18)
Share of leads/users that become paying customers (0–1).
conversion_rate
VARIABLEprice_per_month
lognormal(50, 15)
Average subscription price paid per customer per month.
price_per_month
VARIABLEmonthly_churn
beta(2, 38)
Monthly churn rate for paying customers (0–1).
monthly_churn
CONSTANTmonths
12
Forecast horizon.
months
CONSTANTeps
0.000001
Small value to avoid division by zero.
eps
FORMULAstarting_paid
starting_users * conversion_rate
Initial paying customers (simplified as starting_users × conversion).
starting_users
conversion_rate
starting_paid
FORMULAmonthly_new_paid
monthly_leads * conversion_rate
New paying customers added each month.
monthly_leads
conversion_rate
monthly_new_paid
FORMULAretention_12
(1 - monthly_churn) ** months
Retention factor over 12 months.
monthly_churn
months
retention_12
FORMULApaid_month12
starting_paid * retention_12 + monthly_new_paid * (1 - retention_12) / (monthly_churn + eps)
Approx paying customers at month 12 with constant churn and constant monthly additions.
starting_paid
retention_12
monthly_new_paid
monthly_churn
eps
paid_month12
FORMULAavg_paid_12m
(starting_paid + paid_month12) / 2
Approx average paying customers over the year (linear approx).
starting_paid
paid_month12
avg_paid_12m
FORMULAavg_mrr
avg_paid_12m * price_per_month
Average monthly recurring revenue over the year.
avg_paid_12m
price_per_month
avg_mrr
FORMULArevenue_12m
avg_mrr * months
Approx total subscription revenue over 12 months.
avg_mrr
months
revenue_12m
OUTPUTrevenue_12m_out
revenue_12m_out
Total subscription revenue over the next 12 months (approx).
OUTPUTavg_mrr_out
avg_mrr_out
Average MRR over the next 12 months (approx).
OUTPUTpaid_month12_out
paid_month12_out
Paying customers at month 12 (approx).
What is Carlo?
Carlo is a visual tool for Monte Carlo simulation. Model uncertainty by dragging probability distributions, connecting them visually, and running thousands of scenarios instantly.