Chris J Snook- Founder Institute Denver mentor presentation on the rules of good revenue model design and the laws of revenue, compensation, and growth along.

1. Modeling with The Law of Revenue
Mentor Session Denver
11/18/14

2. WARNING!!!!
Now 45 Minutes from Now

3. Chris’ Rules for Revenue Drivers
• How do we get PAID TO PROSPECT?
• Marketing is Content-CONTENT IS MARKETING
• PURSUE THE MONEY in your Idea
• COPYING PAYS BETTER Than Innovation
• WANTS sell faster than NEEDS
• Would you buy this solution from yourself at this
price, this way, and if so, for how long?
• Money must move and it moves by LAW not LUCK

4. THE LAW OF REVENUE
1.The Need
2.***********
3.***********
***

5. Solve Problems That Matter*
F**king Great
THE LAW OF REVENUE
1.The Need
2.Your Ability
3.Replace-ability?!?!?
*Must matter to you and the market
**Remember that you are trading your life in the pursuit of
this dream
**

6. Bottom’s UP
• DO Address the unit
economic value of your
offer and how much it
costs, converts, and yields
and what it takes to get
one.
• DON’T project market size
and the percentage you
think you can capture.

7. WHAT INVESTOR PERSONA DO
YOU WANT TO REVEAL?
They call me Mutha’F*cka Jones
"I Don't Need Anything But You"
Hello my name is
Daddy Will Stacks
Top Down, Illogical,
unsustainable revenue
models meet this guy
Law driven, bottoms up,
defensible revenue models
get this guy.

8. Costs in the Startup World
Managing costs is really managing opportunity,
constraints, and accretive activities.

9. Key Categories for your P&L
Category Inputs Things to Consider/Monitor
Revenue Sources Recurring, One-Time, Installment,
Subscription, Royalty, etc
Do you have a healthy Revenue/Profit
Center mix i.e. LinkedIn or are you a 1
trick pony?
COGS Merchant Fees, Sales Commissions,
Materials/Ingredients, Royalties
Less is better if you can design it that
way
Gross Profit This is your usable cash (Revenue
doesn’t matter)
Divide your SG&A total/GP% to
understand your breakeven (i.e. $50,000
per month in SGA/.75= Breakeven of
$66,667 per month Revenue)
SG&A Salaries, fixed overhead, insurance, etc. Keep it lean
EBITDA This is your excess cash flow and
operating margin
You bootstrap from this number and
create your reserves or organic growth
line from here

10. Numbers are Sensitive
CHALLENGE YOUR ASSUMPTIONS MULTIPLE WAYS…TEST,
REPEAT, TWEAK, and MASTER THIS!!!!!

11. Profits Give You Choices

12. Keep the main thing the main thing

13. QUESTIONS

14. RECENT CASE STUDY
Company: Unite For Literacy, LLC
ASSETS/STRENGTHS:
Team, Funding, and Market Timing
End User Product Law Score (10 of 10)
Need: 7 out of 10 U.S Homes<100 books/No Diversity
Ability: Instant 125+ in 24 language narrations
Replace-Ability: Nobody even close/True Blue Ocean

15. CASE STUDY CONT.
THE BOOK SCARCITY PROBLEM MADE VISIBLE TO CENSUS

16. CASE STUDY RESULTS
ISSUES/VULNERABILITY: (Prior to July 1)
Need: Cause Marketing spend on the rise and renewal
rates are low at approx. 6% nationally
Ability: Digital book sponsorship at the county and
national levels was affordable but in no-mans land for
brands to escalate (too expensive and irrelevant for
small biz and too inexpensive and disconnected from a
cohesive strategy for large brands to buy
Replace-Ability: Red Ocean of choice & indirect comp.

17. CASE STUDY RESULTS
Sept 1-New Decisions and Product Bundling:
-Small businesses are key to distribution points and also
become paid media opportunities for large brands at
scale. Brand affinity chain now aligned across target base.
-Unique media buy co-sponsor opportunities (airline smart
trays, etc) provide us ways to get Paid to Prospect
-New physical book product gateway kits easy to buy and
sponsor and a viral video add relevant value to small
sponsors and drove 3x online reader growth in 1 month

18. CASE STUDY RESULTS
New Sales Narrative in 3 simple steps:
1)Unite (Mandatory)
i. Choose to distribute (free)
ii. Choose “where” to sponsor (a
penny/kid/book/year/population) i.e. 31,600 kids under 8
in Larimer=$316/year
2)Give (Recommended)
III. Pick an activation kit for your needs (start at $25/mo)
1)Engage (Optional)
IV. Differentiate through already existing unique mktg assets
i.e. 100 airplanes only $25 per departure; Dallas Cowboys, etc.

19. THANK YOU!
CHRISJSNOOK.COM