Business of Software

You have just launched an Internet service that has a subscription model. Early growth appears to be really strong and you can't help doing the back of the envelope calculation: if acquistion continues at this rate 1 million customers is just around the corner!

Unless you have been around the recurring revenue block before (or even if you have) your estimate is almost always just a linear extrapolation of your net monthly acquisition.



This is almost certainly wrong. (Explanation after the jump)