Originally published on the Braavo blog on 9 October 2019 and shared here the next day. This is a historical account of scaling at PuzzleSocial, not a recommendation for a particular financing product today.
Short answer: projected lifetime value (LTV) is not cash in the bank. Spending to acquire users can come before much of their revenue, so scaling needs funding for the gap. Read the original: The World’s Best LTV is Useless without Cash.
Page Contents
What happened?
At PuzzleSocial, we had five full-time staff and one game, Daily Celebrity Crossword. We had grown from almost zero to mid six figures a month in acquisition spend within a few months. Retention and monetization had improved, and my projections looked strong even after allowing for diminishing returns.
Minutes after presenting a plan to scale further, I learned that moving to high six figures a month required cash we did not have. A promising long-term model did not solve next month’s bills.
What were the three lessons?
- Revenue can arrive late in a retained user’s life. We had prioritized experience over aggressive early monetization. That supported retention, but meaningful revenue came later. I had seen other products earn a significant share of revenue after year one; the timing issue can apply to subscription apps too.
- Progression can delay monetization. Our feature roadmap depended on deeply engaged users, typically 60-plus days in. In the article, premium purchases, guilds and invitations illustrate how progression and social features can take time to matter. Much of our monetization came beyond day 60.
- Bills arrive sooner. Moving from mid to high six figures without covering the cash gap could have left us unable to pay the next month’s bills. Facebook and the landlord could not wait for the long-term revenue in my model.
How did it end?
After extensive diligence, the company raised a debt round. The process took attention away from product and growth, but the non-dilutive funding gave us room to keep scaling, eventually to about $1.5 million a month in acquisition spend before the company was acquired.
The lesson was to model cash receipts and payments alongside lifetime revenue. It was not that debt is always the right answer.
What do I read next?
The growth side of the story is in how we scaled from zero to $1.5 million per month. For planning, see how to calculate LTV without a lifetime of data and how to set a mobile user acquisition budget.
Frequently asked questions
Why was strong LTV not enough? The modeled revenue arrived over time; the team needed cash to pay bills sooner.
How did the team close the gap? With a debt round that funded continued scaling without giving up equity. This describes that historical outcome, not a universal financing recommendation.




