I’m really pleased to see this: I have been wondering how one would do an EA-minded evaluation of the cost-effectiveness of a start-up that runs it head to head with things like AMF. I’m particularly pleased to see an analysis of a mental health product.*
I only have one comment. You say:
The promise of mobileHealth (mHealth) is that at scale apps often have ‘zero marginal cost’ per user (much less than $12.50) and so plausibly are very cost-effective
It doesn’t seem quite that tech products have zero marginal cost. Shouldn’t one include the cost of acquiring (and supporting?) a user, e.g. through advertising? This has a cost, and this cost would need to be lower than $12.50 per user, given your other assumptions. I have no idea what user acquisition costs are and if $12.5 is high or low.
*(Semi-obligatory disclaimer: Peter Brietbart, MindEase’s CEO, is the chair of the board of trustees for HLI, the organisation I run)
I’m really pleased to see this: I have been wondering how one would do an EA-minded evaluation of the cost-effectiveness of a start-up that runs it head to head with things like AMF. I’m particularly pleased to see an analysis of a mental health product.*
I only have one comment. You say:
It doesn’t seem quite that tech products have zero marginal cost. Shouldn’t one include the cost of acquiring (and supporting?) a user, e.g. through advertising? This has a cost, and this cost would need to be lower than $12.50 per user, given your other assumptions. I have no idea what user acquisition costs are and if $12.5 is high or low.
*(Semi-obligatory disclaimer: Peter Brietbart, MindEase’s CEO, is the chair of the board of trustees for HLI, the organisation I run)
Cheers- thanks for the comment!
I’m using the term zero marginal cost colloquially as is common parlance in the tech sector.
Your app might spread through word of mouth, the server costs are trivial and then you can scale at ~zero marginal cost.
As you say in practise tech firms often spend a few dollars on acquiring new users/customers.