MKT 626 | Class 5 | Arbor Threads

Cohort Unit EconomicsWhen does a cohort pay back its costs?

Take one real Arbor Threads cohort and build its discounted cash flow the way the class workbook does: start from revenue per active customer, scale by % active to get revenue per cohort member, scale by margin to get cash flow, discount it, then subtract what you paid to acquire them. Time runs in quarters since acquisition, and quarter 0 is the acquisition quarter itself.

Real cohort, real decayThe activity and revenue numbers are computed straight from the transaction log you have. Only the blue-cell assumptions are yours to move.

Assumptions and cohort

trlog_cds_5yr.csv | time = quarters since acquisition | quarter 0 = the acquisition quarter
Share of revenue left after variable costs.
...Cohort members acquired
Unlocks in step 2Expected revenue per member, all observed quarters
Unlocks in step 4PV of expected cash flows per member
Unlocks in step 5Net per member after CAC
Unlocks in step 5ROI and payback quarter

One cohort, one row of the workbook at a time

The chart is this table

Every bar above is one row below, exactly the workbook's columns.

Reading the race

Every line is one cohort's cumulative net expected DCF per member, aligned by quarters since acquisition and using the sliders above. A line ends where the data ends: the 2023-Q4 cohort has one observed quarter, not worse economics. Crossing $0 is payback. Hover a line or its row to pick a cohort out.

Every cohort under the same assumptions

PV and net are per member over the observed window only.

Model, conventions, and source notes

Workbook logic. This is the sheet Class 5 - DCF in Cohort Unit Economics made live. Time runs in quarters since acquisition; quarter 0 is the acquisition quarter itself. The ladder, per quarter: revenue per ACTIVE customer; times % active = expected revenue per newly acquired customer (equivalently, cohort revenue / cohort size, so revenue per cohort MEMBER); times contribution margin = expected cash flow per member; times the discount factor = expected discounted cash flow, at the quarterly rate implied by the annual slider, (1 + annual)^(1/4) - 1. Quarter 0 is not discounted (factor 1.000), and CAC is paid at quarter 0. ROI is net gain per member over CAC, the workbook's framing.

Data. Aggregated from trlog_cds_5yr.csv, the Arbor Threads 20% customer sample you work with, cohorts 2019-Q1 through 2023-Q4. The class sheet's worked example uses the full customer file, so its 2022-Q1 cohort is about five times this size (4,576 members vs 908) with slightly different per-member revenue ($402 vs $382 in period 0). Sampling moves the counts, not the economics. Observed windows are censored: a cohort acquired later simply has fewer quarters of history.