Sunk Cost vs the Next Product Investment
A short software company decision problem. Use the supplied facts, commit to one action, then check your reasoning. Fictional practice; no leaderboard score is recorded.
Software company · sunk cost
You have spent $1.8M and two years on a product. It has 40 customers, growth is flat, and finishing the roadmap would cost another $900,000. The same $900,000 spent on your profitable core product is expected to return roughly $2.5M.
| Given fact | Scenario data |
|---|---|
| Past product investment | $1.8M and 2 years |
| Customers | 40; growth flat |
| Remaining roadmap cost | $900,000 |
| Alternative core investment | $900,000 |
| Expected core return | About $2.5M |