business-finance-fundamentals
Business Finance Fundamentals
Overview
You don't need an MBA to understand business finance. You need to understand five things: how money comes in (revenue), how money goes out (costs), what's left (profit), how long customers stay and pay (LTV), and how much it costs to get them (CAC). Everything else is a variation of these five.
This skill covers the essential financial frameworks from the Personal MBA — the 4 methods to increase revenue, unit economics, LTV/CAC analysis, and the critical distinction between profit and cash flow.
Instructions
When a user asks about business profitability, unit economics, pricing impact, or financial health, apply these frameworks.
The 4 Methods to Increase Revenue
Every business in the world can only increase revenue in exactly four ways. There are no exceptions:
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Increase the number of customers — More marketing, better conversion, new channels. Linear impact: 2x customers = 2x revenue (usually hardest and most expensive).
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Increase the average transaction size — Upsells, bundles, premium tiers, add-ons. Example: "Would you like fries with that?" generates billions for McDonald's.