# #finance-lexicon

> 18 public memos tagged #finance-lexicon on MythOS.

## Links

- [Tag Page](https://mythos.one/tag/finance-lexicon)
- [MCP Server](https://mythos.one/api/mcp)

## Memos

- [Payback Period](https://mythos.one/me/johnzdanowski/52ae2d): Payback Period is the time it takes for an investment to recover its initial cost from the cash it generates; in Unit Economics, it is the number of months a customer's gross profit takes to repay...
- [Contribution Margin](https://mythos.one/me/johnzdanowski/8fa6d4): Contribution Margin is revenue minus all variable costs, expressed per unit or as a percentage of revenue: the amount each sale contributes toward covering fixed costs and generating profit. In cost...
- [Lifetime Gross Profit (LTGP)](https://mythos.one/me/johnzdanowski/a44d3f): Lifetime Gross Profit (LTGP) is the total gross profit a business expects to earn from a single customer over the relationship, calculated as lifetime revenue multiplied by realized gross margin, and...
- [Lifetime Value (LTV)](https://mythos.one/me/johnzdanowski/194a89): Lifetime Value (LTV), also called customer lifetime value (CLV), is the total value a business expects to earn from a single customer over the entire relationship, usually expressed as revenue or...
- [Churn Rate](https://mythos.one/me/johnzdanowski/5b8ee6): Churn Rate is the percentage of customers, or of recurring revenue, lost during a period, calculated as the customers lost in the period divided by the customers at the start of it. Also called...
- [Gross Margin](https://mythos.one/me/johnzdanowski/0faada): Gross Margin is revenue minus cost of goods sold (COGS), expressed as a percentage of revenue: the share of each sales dollar left after paying the direct costs of producing and delivering what was...
- [Finance Glossary](https://mythos.one/me/johnzdanowski/9bd60c): The Finance Glossary is a collection of the finance, accounting, and business-metrics terms John Zdanowski uses in his CFO work, gathered so founders, operators, and investors can read his models,...
- [Highest and Best Use](https://mythos.one/me/johnzdanowski/1849c7): Highest and best use is the real estate appraisal term for the reasonably probable and legal use of land or a property that is physically possible, appropriately supported, financially feasible, and...
- [Credit Box](https://mythos.one/me/johnzdanowski/bacdff): A Credit Box is the objective set of requirements, or investment criteria, that an underwriter uses to determine whether or not to make a loan. A lender's credit box typically sets thresholds on the...
- [Schumer Box](https://mythos.one/me/johnzdanowski/6e8f1e): A Schumer box is the standardized table in United States credit card applications and solicitations that summarizes a card's rates and fees in a uniform format. The box is named for Chuck Schumer,...
- [Financial Planning and Analysis](https://mythos.one/me/johnzdanowski/2d22ad): Financial Planning and Analysis (FP&A) is the finance function that helps an organization plan, measure, and steer its financial performance through budgeting, forecasting, modeling, and performance...
- [Magic Cohort](https://mythos.one/me/johnzdanowski/c490d0): The Magic Cohort is the sub segment of customers who represent a set of customers that have the highest LTV:CAC ratio. It’s a fallacy to only look at the Magic Cohort because you also spend money on...
- [Fractional CFO](https://mythos.one/me/johnzdanowski/d9a4c1): A Fractional CFO is a financial executive who leads a company's finance strategy, sales development, growth opportunities, and finance department on a part-time or contract basis rather than as a...
- [Financeable Equation](https://mythos.one/me/johnzdanowski/9d2202): A Financeable Equation is a business story supported by demonstrated positive unit economics, stated precisely enough that a lender or investor can underwrite capital against it. The story says how...
- [The Runway Calculation](https://mythos.one/me/johnzdanowski/482f20): The runway calculation measures how many months a company can keep operating before it runs out of cash, computed as cash on hand divided by the monthly net burn rate. Burn rate is the pace at which...
- [LTV:CAC](https://mythos.one/me/johnzdanowski/218c8f): LTV:CAC is the ratio of a customer's lifetime value (LTV) to the Customer Acquisition Cost (CAC) spent to win them, and it is the most important component of a Financeable Equation. A ratio above 1:1...
- [Customer Acquisition Cost (CAC)](https://mythos.one/me/johnzdanowski/eb98e4): Customer Acquisition Cost (CAC) is the total sales and marketing spend required to win one new customer, calculated as the acquisition costs of a period divided by the number of new customers...
- [Unit Economics](https://mythos.one/me/johnzdanowski/568198): Unit Economics are the revenues and costs of a business expressed per fundamental unit of work (a customer, an order, a product line, a campus) rather than in aggregate. Looking at a business through...