The new role · The plan

Capstone: the 12-month plan for a $3M ARR company

Design a 12-month marketing plan for a flat $3M ARR company: one number per quarter, the hire, what not to do, and the result that changes each part.

designhardExercise · 4 min · 60 of 60

On this page

Every module of the course feeds one page here: the 12-month plan a marketing lead hands the CEO and the board. It practises the plan and the interview, in the five steps of how to answer a case.

The situation

The invoicing app from module 2, two years on, has 5,000 customers at $50 a month: $3M of ARR, 80% gross margin and 5% monthly churn, so $800 of lifetime margin each. ARR has been flat for two quarters. Each month $50,000 of paid media brings 96 customers, a paid CAC of $521, and organic brings 154 more. The churn score in the CRM puts 100 of each month's 250 churners in its top decile of 500 customers, and nobody acts on it; assume a save email with no discount (pause, or annual billing at the same price) keeps one in four of them. A monthly upgrade send to 20,000 active free users caused 25 upgrades a month against a holdout last year, then stopped in spring. The team of three spends 102 hours a month on ten tasks a workflow could run, and there is budget for one $150,000 hire.

The board wants $3.3M of ARR in 12 months and a 12-month payback on new spend, a CAC ceiling of $368. The founder proposes doubling paid, assuming the second $50,000 buys 60 customers, and publishing 500 generated posts a month.

The question

Design the 12-month plan: what each quarter does and the number it moves, the hire, what you will not do, and the result that would change the plan.

A strong answer · Rubric · Where answers go wrong

Write your answer first, then open

A strong answer

The deciding number. ARR is flat because 5,000 × 5% = 250 customers leave a month and 96 + 154 = 250 arrive. At 5,000 customers one point of churn is 50 customers a month, while the second $50,000 of paid buys 60 at $833, more than the $800 each returns (paid media basics). Retention comes first.

from month  churn   arrivals   lever
1           5.0%    250        today
2           4.5%    250        save offer on the score's top decile: 25 kept a month, assumed
4           4.5%    275        upgrade send restarted: +25 a month, measured
7           4.0%    275        annual plan and onboarding fixes: assumed, the least certain line
month 12    about 5,550 customers, $3.33M ARR
founder     +60 paid a month at 5% churn: about 5,550 customers, $600,000 more spend

Q1, measure and hire: churn to 4.5%. Hire the marketing-ops builder; act on the churn score; run a four-week geo holdout on paid (the measurement plan); put the review standard live. Report paid CAC, $521, not the blended $50,000 ÷ 250 = $200 (blended versus paid).

Q2, retain: arrivals to 275. Restart the lifecycle send. Split churn by freelancers and agencies and aim the annual plan at the segment that stays (segmentation), with disclosure lines on every asset.

Q3, reallocate. Cut any paid the holdout prices above $368 per incremental customer, and add 24 reviewed generated posts a month to the 8 written (when content costs nothing).

Q4, read the year: $3.33M, and set next year's split.

Not doing. Doubling paid reaches the same 5,550 customers for $600,000 and loses $33 on each extra one; 500 posts cost $25,500 a month once reviewed.

What changes it. Churn still at 4.5% in month 7 ends the year near 5,400 customers, $3.25M, and the board hears that in month 7. A holdout pricing paid's incremental CAC under $368 reopens a paid increase.

Rubric

Explains the flat ARR with the churn arithmetic, 250 in and 250 out, before proposing anything.
Projects month 12 with every lever dated and marked measured or assumed, and sets the founder's plan against it.
Gives each quarter one number it moves, and ties each part to the module it draws on.
Rejects doubling paid and 500 posts with their numbers: $833 against $800, and $25,500 a month.
Names the hire and the measurement (the holdout, the sampled review) that keep the plan honest.
States the results that would change the plan, which is what a hiring manager scoring the page looks for first.

Where answers go wrong

"Double paid and add generated content to hit the number." It reaches about the same 5,550 customers for $600,000 more, loses money on every extra customer, and leaves churn at 5%, so next year starts exactly where this one did.
"A brand refresh, an AI content engine and a new website." Activities with no number attached. Nothing in it can be checked at month three, so the first quarter's budget is spent before anyone knows whether it worked.
"Fix churn and promise $4M to show ambition." The plan's own projection says about $3.33M. A promise the arithmetic does not support loses the board at the first quarterly review, and with it the budget for the retention work.