When Churn Is the Model

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In SaaS, churn is the boogeyman. Founders track net revenue retention, lifetime value, and the magical moment when a customer finally pays off their CAC and starts throwing off some margin.

But what if churn isn’t a bug? What if it is the business model?

That’s how I think about dating apps. Their goal is to get you out of the funnel. If they work, you churn—happily ever after.

In the analog world, it’s not all that different. Think: funeral homes and wedding planners. People die. People get married. Prob not coming back for either (well, def not the first).

There are more examples like this: industries where the TAM’s regenerate, even if the customers don’t.

Industries Built for One-and-Done

• Dating Apps: Bumble, Tinder, Hinge

  • Ashely Madison being the notable exception

• EdTech: Duolingo, Udemy, Coursera

  • You don’t learn Spanish twice. I guess you could come back and learn Portuguese though?

• High-friction, Low Frequency marketplaces: Zillow, Redfin, Carvana

  • Take Zillow. Sure, it’s a marketplace. But let’s be real—they’re prob not modeling a customer LTV that includes five homes in ten years. They just want to win the window of opportunity.

All of this to say, I may have found the most fascinating “recurring market” startup out there - SimpleClosure, a company that helps other companies shut down. Their users are single-use. The market? That’s what repeats.

A Tale of Two Models

1. Recurring Customers = Lifetime Value Game

This is classic SaaS. Predictable, compounding revenue built on retention. Every dollar you spend to acquire a customer gets paid back slowly over time. The longer they stay, the better the model works.

Metrics that matter here:

• Monthly Recurring Revenue (MRR)

• Net Dollar Retention (NDR)

• Expansion Revenue

• Churn Rate

This model is great for:

• B2B SaaS

• Fintech apps

• Workflow tools

But it comes with pressure. Churn threatens everything. If your product isn’t sticky, the whole thing falls apart. Your P&L blows up.

2. Recurring Markets = Replenishable Demand

Now, flip the script. What if your customers aren’t coming back, and that’s fine?

SimpleClosure lives in this world. Their customer shows up once, at a critical moment, and disappears.

Seriously - they cease to exist after the service is completed.

But the market stays steady: about 700,000 U.S. businesses shut down each year. It hasn’t changed in like a decade.

This is the playbook for a recurring market. You’re not banking on loyalty. You’re betting on a steady stream of new customers facing the same problem.

• Retention isn’t the metric; replacement is

• LTV takes a back seat to market size and velocity

• SEO, timing, and trust outweigh traditional product stickiness

When the pain is sharp and the market is large, you don’t need to hold on. You just need to show up—fast.

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How This Changes Product & GTM

Product: Resolution Over Retention

In a churn-by-design world, users aren’t sticking around. So:

• Speed trumps depth. Solve the problem fast.

• Automation beats personalization. You’re handing them a definitive job to be done, not a CRM experience.

• Build for consistency, not flexibility. Everyone has the same pain—solve it the same way, every time.

As Dori Yona, CEO and Co Founder of SimpleClosure put it:

“We don’t have power users. We have panicked users.”

Go-to-Market: Capture Urgency, Not Loyalty

When retention isn’t the engine, timing is everything.

• Search is more important than sales. When they need you, they’ll Google you. It’s imperative to show up first.

• Trust is more important than features. Deliver in the moment.

• CAC isn’t about scale; it’s about speed. You’re fighting for a 48-hour decision window.

Operations: Tight Loops, Tight Systems

• Every customer is a case study. Learn quickly.

• Internal tooling drives your margin.

• Reputation compounds—even if revenue doesn’t. In a one-and-done world, trust and word of mouth drive your growth loop.

Speaking of that - these types of business models THRIVE on WoM (word of mouth). Especially if it’s a service that provides a pain killer, rather than a vitamin.

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Is This as Valuable as SaaS?

It can be. But the metrics shift.

SaaS is beloved for its predictability: MRR, retention, expansion. Investors hate uncertainty and love the ability to reliably forecast something.

But high-churn businesses can be just as sound. You just need to compress value into a shorter window.

It all comes down to LTV vs CAC.

SaaS stretches CAC over years. In high-churn models—like dating apps, bootcamps, or marketplaces—it’s all gotta happen up front. Your margin has to show up early. You gotta make money off the rip.

To win here, you optimize for:

• Instant conversion

• Upfront cash

• Flawless offboarding

• Referral-worthy outcomes

Your systems, cost structure, and comp plans all have to match that short customer lifespan.

You can’t use long-term SaaS math on a short-term user. That’s when churn becomes dangerous.

(Make sure you aren’t paying an enterprise sales rep a 12% vig on each deal…)

But if you build for churn?

You don’t just survive it… You scale with it.

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Run the Numbers

Apple | Spotify | YouTube

I almost never have founders on the pod. They tend to be heavy on fluff and light on tactical insights. But this one was a special exception, as Dori is uniquely qualified to explain a situation most CFOs and operators grapple with at least once in their careers - shutting down a company. We unpack:

• The financial, legal, and emotional complexities of shutting down a company.

• Options available when a company is running out of cash

• What bankruptcy actually means

• The importance of budgeting for the end

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Quote I’ve Been Pondering

The biggest problem people have with saying no is that they convince themselves that by buying time they are actually saving time.

If you are feeling overwhelmed or harassed, it is much easier to say, “Let me think about it,” or “Let me get back to you,” than it is to deal with it and get it out of the way.

This is particularly tempting when you already know the answer is going to be a negative one.

Obviously these situations don’t just go away, and by not taking five minutes to deal with it at the moment you invariably end up spending a lot more time with it in the future.

-What They Don't Teach You at Harvard Business School by Mark H. Mccormack