CapEx, OpEx and Consumption-based

Source: https://www.youtube.com/watch?v=WiwV9wb0GMo&list=PLlVtbbG169nED0_vMEniWBQjSoxTsBYS3&index=3

Capital Expenditure - Pre-purchasing a particular asset that you plan to use for a certain period of time

  • Depreciate this over a period of time

Operational Expenditure - Purchasing a resource as we use it (Cloud) AKA consumption based

  • Allows a company to only pay for what they need whether it be hardware or licensing

  • As the company grows, you can easily pay for more resources to continue that growth

  • Ex. A pizza company might be really busy on Friday nights, but not so busy on other days

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