Back-of-the-Napkin Business Model Math

(Or how to know: “If I don’t do it, someone else will!”)

Optimism often prevents founders from communicating why their business makes sense from first principles, because it’s so obvious to them that it should exist. The ability to think through and communicate why a business needs to exist at the very earliest stages is a massive indicator of future success. 

Another way to frame this is simply: “What must be true in order for my business to make sense?”