SCENARIOS

Three scenarios. One truth.

Downside, Base, Upside. Same product, same cost curve, different assumptions on pricing, retention, and channel mix. The math works even in the downside.

Y5 ARR (base)

$141M

79,596 paying households

Model sheet, arr_y5 (Base)

Y5 EBITDA% (base)

30%

on 68% gross margin

Model sheet, ebitda_y5 / revenue_y5 (Base)

Y5 ARR (upside)

$268M

TODO(model): confirm upside column in sheet

Y5 ARR (downside)

$57M

TODO(model): confirm downside column in sheet

Monthly churn (base)

8.0%

85% annual retention

Model sheet, churn_monthly (Base)

CAC payback (base)

< 1 mo

$30 CAC against $102 contribution

LAST UPDATED 2026-04-22

The scenario shown on the Financials page is Base. This page lays all three side by side. Downside is the defensible floor, assumed against adverse shocks on pricing and retention. Base is the committed plan. Upside is the model that includes the two expansion vectors (Workshop schools at scale and kid-side monetization) that we do not underwrite today but may well earn.

Scenario comparison (Y5 steady state)

Columns are Downside / Base / Upside. Base resolves to the model sheet active column. Downside and Upside are explicit scenario columns; their values are scaled with per-row narrative. TODO(model): confirm final Downside/Upside columns once the sheet has a published scenario-switch.

	Downside	Base	Upside
Monthly active users (Y5)	480K	1.2M	2.4M
Paying households (Y5)	32K	79,596	180K
Blended ARPU (Y5)	$119 / mo	$149 / mo	$168 / mo
Gross margin (Y5)	62%	68%	72%
ARR (Y5)	$57M	$141M	$268M
EBITDA % (Y5)	12%	30%	38%
Cash burn peak (monthly)	$95K	$67K	$48K
Runway (months)	32	44	profitable Y2

Base column resolves to the live sheet. Downside and Upside are scenario-column outputs; TODO(model) to wire the page harness to the scenario switch when the sheet exposes all three columns directly.

Driver tree: what ARR is made of

flowchart TD ARR["Y5 ARR $141M (base)"] --> MAU["MAU (1.2M base)"] ARR --> CONV["Conversion (6.6% MAU to paid)"] ARR --> ARPU["Blended ARPU ($149 / mo)"] MAU --> CH_REF["Referral channel (shipped-app badge)"] MAU --> CH_PAID["Paid channel (perf marketing)"] MAU --> CH_SCHOOL["School channel (Workshop tier)"] CONV --> ONB["Onboarding (first shipped URL)"] CONV --> PRICE["Pricing A/B ($149 vs $199)"] CONV --> TRIAL["Trial shape (14-day)"] ARPU --> TIER_B["Builder monthly ($149, 72%)"] ARPU --> TIER_A["Builder annual ($112 eq., 20%)"] ARPU --> TIER_F["Family plan ($249, 8%)"] classDef revenue fill:#2EE87A,stroke:#0F1419,stroke-width:2px,color:#0F1419; class ARR revenue;

Top-level ARR decomposes into MAU times trial-conversion times trial-to-paid times ARPU times twelve. Each node lists its base-case value.

Key drivers (top five sensitivities)ARPU is the most load-bearing variable. AI cost is the least. Elasticity numbers are the model-output ratio per 1% shift in the driver.

Ranked by elasticity on Y5 revenue. A full shock analysis (20% up / 20% down) lives on the Financials page; the top-line ranking lives here.

Top five drivers

	Driver	Elasticity (Y5 rev)	Why it matters
Blended ARPU	Blended ARPU	1.00	Direct multiplier on revenue. A 10% shift moves Y5 revenue by roughly 10%. The pricing A/B defends this.	→
Monthly churn	Monthly churn	-0.85	Compounds over the retention curve. A 10% worse churn shrinks LTV and reduces Y5 paying households materially.	→
MAU growth rate	MAU growth rate	0.70	Sets the top of the funnel. Growth rate decay past month 24 is the single biggest uncertainty in the forecast.	→
Blended CAC	Blended CAC	-0.45	S&M spend is fixed in the base case. CAC drift shrinks the funnel rather than the per-household economics.	→
AI cost per member	AI cost per member	-0.15	Material on margin, immaterial on revenue. A 20% shock moves Y5 EBITDA by ~$2.3M.	→

Elasticity is the model-output ratio per 1% shift in the driver, holding other variables at base. Full sensitivity tables on Financials; combined-shock stress test in the data room.

Assumptions ledgerExhaustive list of every assumption in the model, with the current value and a status marker on whether it is validated.

An assumption is validated when the live pilot or the published sheet supports the number. It is marked TODO(model) when the assumption is reasonable but not yet defended by observed data.

Assumptions ledger

	Assumption	Value (base)	Status
Builder monthly price	Builder monthly price	$149 / mo	Committed, current list price
Builder annual price (equivalent)	Builder annual price (eq.)	$112 / mo	Committed, 25% annual discount
Workshop (schools) price	Workshop (schools) price	$79 / kid / mo	Committed, 20-seat minimum
Family plan price (Y3+)	Family plan price	$249 / mo for 2 kids	TODO(model): validated on Y3 cohort
Blended ARPU	Blended ARPU	$149 / mo	Sheet (arpu_blended, Base)
Monthly churn	Monthly churn	8.0%	Sheet (churn_monthly, Base). Pilot observed at month 1 to 4.
Annual retention	Annual retention	85%	Sheet (retention_annual, Base). TODO(model): reconfirm past month 6.
Trial-to-paid conversion	Trial-to-paid	47%	TODO(model): pilot observed at 52% on a small n
MAU to trial conversion	MAU to trial	14%	TODO(model): anchored to industry benchmarks
Blended CAC	Blended CAC	$30	Sheet-derived (LTV / LTV_CAC). TODO(model): decompose by channel.
LTV	LTV (steady-state)	$1,264	Sheet (ltv, Base)
LTV : CAC	LTV : CAC	42.1x	Sheet (ltv_cac, Base). Model assumes compression to 8-15x at scale.
Gross margin (Y5)	Gross margin (Y5)	68%	Sheet (gross_margin, Base)
AI inference cost curve	AI inference cost curve	-40% over 5yr	Committed, one generational drop modeled
Stripe payment fees	Stripe payment fees	2.9% + $0.30	Committed, no negotiation modeled
Revenue recognition lag	ARR to recognized revenue	0.76x	Standard mid-year cohort math
Seed extension size	Seed extension size	$3.0M	Sheet (raise_amount)
Series A trigger	Series A trigger	$500K ARR at Month 18	Committed

Scenario-switch in the sheet propagates Base / Downside / Upside columns across the portal. This ledger shows the Base values. TODO(model): expose Downside and Upside values per row when the sheet publishes the scenario columns.

What would change the scenario?One paragraph per direction. What pushes us from base to upside, and what pushes us from base to downside.

Base to Upside. The $199 tier wins the pricing A/B and lifts blended ARPU by 10 to 15%. The shipped-app viral badge produces a referral share above 50% by Y3 and compounds CAC down into the $18 to $22 band. The Workshop tier lands three lighthouse districts by Y2 and opens a classroom-to-home funnel that the base case does not credit. Family plan at $249 for two kids lands above 12% of paying households by Y3 rather than the 8% in base. Any two of these four move us materially toward upside. All four land us there.

Base to Downside. Monthly churn fails to compress below 9.5% after the first-month drop-off work in Stage 2. Paid channel CAC runs hot and the referral loop never clears 30% of new acquisitions. The pricing A/B fails, meaning $149 is the ceiling rather than the floor, and Workshop mix shift dilutes blended ARPU toward $120. Any one of these alone holds us near base. Two together is how downside shows up. The mitigation for all three is the Stage 2 founding-100 cohort work plus the shipped-app badge as the primary referral mechanic.

What does not change the scenario. AI inference cost is 40% of the cost stack but only 13% of revenue. A price war at Anthropic is margin-relevant, not revenue-relevant. A compliance shock inside COPPA is a gating event, not a cost event; either we clear the gate and keep running, or we do not. The model does not try to price that either way. Counsel keeps the radar live.

Three scenarios. One truth.

Scenario comparison (Y5 steady state)

Driver tree: what ARR is made of

Top five drivers

Assumptions ledger

See also

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