Development for Unagi\u2019s new mobile app began with the Model Eleven, a project that ended up being too expensive to take to production.\u00a0Image Credits: <\/strong>Unagi<\/p>\n<\/div>\n

Hyman said it is actually surprising to see how much more popular the subscription business is than the retail side of things. The unit economics have gotten to a good place, too, with gross margins of 50%, according to the founder.<\/p>\n

Unagi expects to be profitable by this year \u2014 and the company means net profitable, not adjusted.<\/p>\n

\u201cFrom a strategy point of view, with a SaaS style company, their valuation multiplier on $1 of revenue is, in good times, up to 30x and in bad times 10x,\u201d said Compagnone. \u201cAs a sales company, your multiplier as a function of revenue is like 1 to 1.5x. Hardware-as-a-service is a new space where there aren\u2019t a lot of proxies, but we\u2019re finding that in good times, we\u2019re doing 12x to 15x, and in bad times 8x to 10x. So this is the place we want to be instead of sales, for sure.\u201d<\/p>\n

Aside from the Best Buy partnership, Unagi hopes to boost its subscription offering by partnering with enterprises. The company already works with Google to give employees access to subscription costs, which are 100% reimbursable to them.<\/p>\n

\u201cWe are going to imminently launch a program where employees that work at companies who have known transportation reimbursements will receive exclusive benefits on Unagi\u2019s website (i.e. waiving $50 signup fee and\/or monthly discounts) simply by registering with their work email address,\u201d said Hyman. \u201cWe will auto-detect their domain and apply the appropriate benefit to their transaction. They can then easily access their subscription account for receipts to easily receive employer reimbursement.\u201d<\/p>\n

Hyman said he expects the enterprise program to be one of the biggest growth drivers in the coming year, with about 25% of all subscriptions coming from that vertical.<\/p>\n