A mat sells once. The intelligence pays monthly.

The product is a sensing mat plus a cloud subscription plus a consumable tag. The mat carries a one-time installation fee per venue of roughly $1,000, with Klynkz retaining ownership of the hardware. It is best read as a customer-acquisition cost dressed as revenue, the price of seating the system, not the source of the margin. The margin lives in the recurring lines.

The cloud is $399 per venue per month, roughly $4,788 a year, and the RFID tags add $0.35 per bottle. That structure means a venue that grows its bottle count grows its Klynkz spend, so revenue per venue expands without a new sale.

The price the venue sees and the revenue Klynkz books are not the same number, and the difference matters to the valuation. The venue pays a subscription plus tags plus a one-time mat. Klynkz books roughly $5,000 to $7,000 of revenue per venue per year at a blended gross margin of 77% to 83%.

The hardware line drags the blended margin in early years; as the recurring base grows, the blend rises toward the software-led 77 to 83 percent range.

In Year 1 the model is roughly 70% recurring, because hardware seats the early base. By Year 5 the recurring lines, cloud plus tags, reach roughly 95% of revenue. Hardware falls to a single-digit share. This is the most defensible number in the model: it is independently supported by the bottom-up build and it agrees with the deck's recurring-mix claim.

Company-side unit economics are clean. Each venue is worth roughly $5,000 to $7,000 of annual revenue, the IaaS line carries a 93 percent-plus gross margin, and the hardware line is a low-margin acquisition cost. Blended at scale the company runs a 77% to 83% gross margin.

The recurring base is the value driver. By Year 5 the IaaS line alone is the majority of revenue at the highest margin in the stack. Hardware volume scales with venue count rather than usage, which keeps the supply requirement plannable against the pipeline.

The reason the subscription is sticky is the math on the other side of it. On a venue doing $200K in annual liquor revenue, Klynkz recovers about $33,000 a year across labor, shrinkage, and backstock, against a subscription a fraction of that size. That is roughly a 7x return to the venue, with payback inside 90 days. Managers do not cancel a tool that pays for itself many times over.

The shrinkage and backstock percentages are single-deployment Gaming first-year results, scoped as such and not yet validated across the independent-bar segment. The labor figure and the $200K reference venue are illustrative targets. [pending source verification across the target venue population]

Every venue feeds the cloud AI, and the data set compounds into accuracy a new entrant cannot match without years of installed base. This is not a slogan, it is a business fact that sits inside the model: better predictions reduce shrinkage and backstock, which raises the recovered value per venue, which makes the subscription stickier, which grows the base that feeds the AI.

flowchart LR
  V["More venues"] --> D["More pour-level data"]
  D --> AI["Smarter cloud AI"]
  AI --> R["Higher recovered value per venue"]
  R --> S["Stickier subscription"]
  S --> V

Transaction and bottle counts that anchor the data-set claim are [pending source verification] to the claims register before they are asserted as the basis of a data-moat figure.

The model invests early, crosses into positive net income in Year 3, and then runs operating leverage as the recurring base compounds against a cost structure that grows far more slowly than revenue. Annual breakeven revenue is roughly $3.5M, and the model clears that in Year 3. In the conservative case, breakeven slips to Year 4.

Every figure on this page traces to the reconciled five-year operating model. The deck's 29.05% IRR and 5.2x FCF are excluded; they are not reproducible from the model and await a rebuild on the real $6M structure. Projections are forward-looking targets, not guarantees.