TMT Associate interview - operating model question

Had a similar question in one of my interviews (for an SA spot -- the expectations for quality / depth are likely different for the AS level), but:

I essentially talked about the drivers for revenue:

• Projected average revenue per user (or client if it's enterprise-level), by looking at past ARPU to look for general trends as well as management commentary (can get more granular if needed by talking about the drivers -- e.g., how marginal pricing is impacted by scale)
• Projected number of users -- management discussion of new projects/expectations and the average user retention rate for the first years followed by a simple growth % for later years (once again, this could probably be more detailed for an AS interview but wasn't touched upon in my SA)

Then I basically walked through how to build a simple operating model:

• COGS as a % of sales -- how much will they grow with scale 
• SG&A as % of sales -- How will these costs scale
• R&D as a % of sales -- How will these costs scale
• D&A as a % of sales 
• BS assumptions 
• CF assumptions 
• ETC...

For this last bit, it's hard to give a proper example without a company, but I interpreted it in my interview as just touching on how I went about / I would go about making projections from a high-level. I think all of those parts could be drilled into more by an interviewer if there are certain industry or company-specific trends you were trying to capture (division restructurings, government R&D subsidies, etc...)

All in, I think it probably makes the most sense to build a simple model for a couple of companies you are interested in, and then talk about that process, or if you are already in TMT banking just talk about the model's you built for processes you've been apart of. 

Hopefully, you find this helpful.