Pay-As-You-Go Revenue Simulator
Model revenue for usage-based pricing. Visualize how 'Whales' (heavy users) drive revenue compared to the 'Long Tail' of light users.
Inputs
Revenue vs Users by Segment
Revenue Concentration
Total Est. Revenue: $23,840.181
Whale Contribution
The 'Whale' segment has fewer users but contributes $5,194. Check if this concentration is too high (risk).
The Long Tail
The 'Low' bucket has many users but low revenue. These are your future whales. Ensure low friction for them.
Average Revenue
ARPU is $47.68, but the median user pays much less. Don't be fooled by averages.
Execution Steps
Set your 'Price per Unit'.
Set average usage per user.
The simulation generates a synthetic user base with realistic usage distribution (power law).
See how much revenue comes from the top % of users.
Pro Strategy
- Focus on 'Whale Hunting'. Since revenue is uncapped, high-usage enterprise clients are worth exponentially more than small ones.
- Implement volume discounts to prevent Whales from churning due to sticker shock.
- Consider a 'Prepaid' credit model to improve cash flow predictability.
Core Concepts
Power Law Distribution
In usage-based models, a small number of users (Whales) often generate the majority of revenue. This contrasts with subscriptions where revenue is flat.
Revenue Uncapped
Unlike flat subscriptions, PAYG revenue grows linearly with customer success/usage. There is no ceiling.
Predictability Risk
PAYG revenue is harder to forecast than MRR because it fluctuates with customer activity.
What is Pay-As-You-Go Revenue Simulator?
This tool uses a stochastic simulation (Monte Carlo style) to generate a user base with an exponential usage distribution. It categorizes users into buckets to visualize revenue concentration risk.
Best For
- • Pricing API products.
- • Estimating revenue for AI tokens.
- • Planning capacity/infrastructure costs.
Limitations
- • Simulated data based on statistical averages.
- • Real usage patterns may vary by industry.
Alternative Methods
Usage-Based Sim
Deterministic calculation of tiered pricing curves.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
AWS
Scaling costs.
Pure PAYG.