How often, while working on your startup, have you heard: "Focus"? And how did you interpret it? How do you know what to focus on right now? When you launch a startup, there are numerous tasks that you absolutely must complete, but you lack the time and resources for everything. And now you're asked to focus—meaning to choose one thing. But how do you choose? 

If you haven't read the article “Identifying Growth Points in a Business Model,” now is the perfect time. In that article, I examine how to identify the business process that is currently the growth driver for your business. The key to this choice lies in unit economics. 

Since unit economics metrics are a numerical reflection of how your business processes function, the growth point revealed in this analysis shows us which process requires improvement. Therefore, additional efforts should be made to find tools for improving that process.

If we use the metaphor that unit economics is a conveyor belt serving your customers, where the input is the process of attracting potential customers (UA), followed by product metrics (C₁, AOV, COGS, APC, LTC), and the output is margin profit (CM), then we can apply Goldratt's Theory of Constraints to this system. The theory states that there is always one bottleneck in any business, and improving that specific process is the most effective way to enhance the overall performance of the business. 

Thus, focusing means choosing the bottleneck business process through unit economics analysis. Directing company efforts toward improving this process leads to business growth. This is an example of applying Goldratt’s Theory of Constraints to startups.

It is essential to remember that after improving one business process, the bottleneck will shift to another process, requiring a new focus. Let’s explore this with an example of unit economics calculations using the ueCalc service. Suppose we have a business with the following metrics: UA = 15,000, C₁ = 1.57%, AOV = 1,400, COGS = 900, APC = 2, and LTC (CPA) = 13. 

We input the data into the free “Basic Unit Economics Model” template and get a row of results. Now, we find the metrics where the margin profit reaches 1,000,000. To do this, select "Find optimal model" in the row menu. 

In the pop-up window, set your constraints and target margin profit value, and check the "step-by-step" box.

The ueCalc service will find the optimal metric configuration. You can read more about this in the article “Unit Economics in Practice: How to Improve Key Metrics for Maximum Profit.” Most importantly, it will provide you with step-by-step metric adjustments, with each step focusing on one specific business process. 

As you can see, using unit economics to work on your product allows you to identify growth points and focus on resolving bottlenecks, which helps save resources and reach your goals faster.