PawPals USA

F18 — Metro Economics

City-Level Models and the First Dollar

This page answersWhich single metro is the cheapest place to prove the model?

Scenario

Assumptions are shared across every financial page — change one, all outputs recalculate.

159 — First dollar simulator

Cheapest path to the first US$1M of revenue

Simulator inputs

ASSUMPTION
US$1.5M
US$1.0M

Recommended first market

MODEL OUTPUTLOW CONFIDENCE
New YorkMODEL OUTPUT

Lowest modelled cost to reach target

US$654KMODEL OUTPUT

Modelled capital to reach US$1.0M

Estimated consumer CACUS$31
Estimated merchant CACUS$427
Users acquired within budget48,387
Paying merchants within budget1,124
Modelled annual revenue at that scaleUS$2.3M
Addressable merchants in metro56,192

156–158 — Metro database

Twenty-four metros, modelled

MetroPet householdsAddressable merchantsConsumer CACMerchant CACMerchant ARPUAddressable GMVModelled revenue at budgetCapital to target
New York5,243,25956,192US$31US$427US$108/moUS$1.7BUS$2.3MUS$654K
Los Angeles3,384,75436,101US$29US$402US$106/moUS$1.0BUS$1.8MUS$831K
Dallas2,129,89021,385US$24US$344US$101/moUS$612.5MUS$1.6MUS$949K
Chicago2,435,64324,910US$27US$376US$103/moUS$721.0MUS$1.6MUS$962K
Houston1,974,80819,439US$23US$331US$98/moUS$543.8MUS$1.5MUS$970K
Atlanta1,658,48316,368US$23US$331US$101/moUS$487.5MUS$1.5MUS$997K
Phoenix1,333,17613,037US$22US$318US$99/moUS$380.5MUS$1.5MUS$1.0M
Washington DC1,657,88216,984US$27US$382US$118/moUS$610.0MUS$1.5MUS$1.0M
Miami1,625,86116,927US$26US$370US$96/moUS$434.3MUS$1.4MUS$1.1M
Seattle1,063,58310,806US$27US$376US$117/moUS$384.7MUS$1.3MUS$1.2M
Boston1,293,48913,032US$28US$389US$113/moUS$448.0MUS$1.3MUS$1.2M
San Francisco1,200,87412,528US$30US$414US$121/moUS$456.5MUS$1.2MUS$1.2M
San Diego859,8348,739US$25US$357US$108/moUS$274.2MUS$1.1MUS$1.4M
Tampa879,0268,641US$22US$318US$94/moUS$230.1MUS$1.1MUS$1.4M
Denver790,1947,893US$24US$338US$109/moUS$256.8MUS$1.0MUS$1.5M
Orlando740,9707,519US$23US$331US$94/moUS$193.5MUS$906KUS$1.7M
Charlotte737,6006,852US$21US$306US$97/moUS$207.5MUS$905KUS$1.7M
Portland659,8416,552US$23US$325US$106/moUS$206.2MUS$857KUS$1.8M
Austin650,3436,448US$24US$338US$106/moUS$208.8MUS$850KUS$1.8M
San Antonio711,0126,538US$20US$293US$90/moUS$179.2MUS$835KUS$1.8M
Sacramento636,4955,674US$21US$306US$100/moUS$187.3MUS$774KUS$1.9M
Las Vegas614,3986,112US$22US$312US$93/moUS$163.5MUS$747KUS$2.0M
Nashville552,8685,399US$22US$312US$96/moUS$153.6MUS$683KUS$2.2M
Raleigh396,8503,648US$21US$299US$104/moUS$126.4MUS$503KUS$3.0M

Positioning

Merchant density against acquisition cost

Dense and cheap — launch hereDense but expensiveThin and cheapThin and expensiveNew York · US$31 CACLos Angeles · US$29 CACDallas · US$24 CACChicago · US$27 CACHouston · US$23 CACAtlanta · US$23 CACPhoenix · US$22 CACWashington DC · US$27 CACMiami · US$26 CACSeattle · US$27 CACBoston · US$28 CACSan Francisco · US$30 CACSan Diego · US$25 CACTampa · US$22 CACDenver · US$24 CACOrlando · US$23 CACCharlotte · US$21 CACPortland · US$23 CACAustin · US$24 CACSan Antonio · US$20 CACSacramento · US$21 CACLas Vegas · US$22 CACNashville · US$22 CACRaleigh · US$21 CAC
Addressable merchants ↑Consumer CAC →

Metro venue counts, CAC and merchant ARPU are MODELLED ESTIMATES derived from population, hospitality density, digital adoption and income indices. They are not measured counts and should be replaced with field data before capital is committed to any single city.

Investor implication

Metro selection changes the capital requirement by a multiple, not a margin. Choosing the wrong first city is the single most expensive avoidable error available to this business.