Capital One Unit Economics: Size the Revenue One Customer Generates Each Month

Choose any Capital One product and estimate the average revenue Capital One earns from one customer of that product in a month. ```hint Not every customer pays every stream Before multiplying anything, list each way the product earns money from a customer, and ask what share of customers actually contributes to each stream. ``` ### Clarifying Questions - May I pick any product (a credit card, an auto loan, a checking or savings account), or do you have one in mind? - Do you want gross revenue, revenue net of rewards, or revenue after credit losses? - Should "per customer" average over every account holder, including inactive accounts, or only active customers? - Is the scope US consumer customers only? ### What a Strong Answer Covers - A reasoned product choice and clear definitions of revenue and of the customer base - A revenue equation that splits the product's streams (for a card: interest, interchange and fees) and weights each by the share of customers who contribute to it - Labeled round-number assumptions and correct arithmetic - A sanity check from a second angle, and the sensitivity of the result to the assumptions that matter most - Awareness of what sits just outside revenue: rewards, credit losses and funding costs ### Follow-up Questions - Which single assumption moves your estimate the most, and how would you narrow it down using public information? - How would the estimate change for a card aimed at people building credit, with lower credit lines and a higher interest rate? - Revenue is not profit. How would you extend the estimate to monthly profit per customer?