This post will be all about SaaS - Software As A Service. This is a business model where you charge your users a monthly subscription fee for a software.

Think of fitness app subscriptions, Spotify, or a twitter automation tool. Let’s talk about the pros and cons of this model.

Pros

You make recurring revenue from the business. One time sales are nice, but you are left empty handed at the start of every month. Revenue is somewhat predictable.
There is a big barrier to entry - anyone can start selling products on shopify or gumroad, but starting a software business is not that easy.
Margins are AWESOME as software doesn’t have much scaling cost, you can even operate as a 1 or 2 person company and scale to as much as $10k/month
You can sell your business quite easily for a 3-5x revenue multiple (sometimes even more!), a feature not every business model can boast off.

Cons

Even if you outsource the coding part, maintaining and building a software business is not that easy. You need devs (costly!) at some point.
Managing churn is HARD. You must actively work on customer support, introducing features, competitive pricing, etc
Recurring revenue can be a golden cage. One time high ticket sales (a $999 online course for example) might make more money than 2 years of a SaaS subscription, and you will have to provide support and features for 2 years!
SaaS is slowly becoming a commodity - you cannot price yourself beyond a certain bracket else the competition will kill you off. Hard to build a brand here (unlike in info product or agency businesses)
Many SaaS have a single point of failure - you might lose your entire customer base if a crucial API your businesses depends on goes off (recent Facebook API changes have destroyed 100s of SaaS businesses)

Note that SaaS does not necessarily mean Software here, it could be any business where you pay every month - a Stock tips group for example.

Many of the cons would still apply here (putting in effort/features every month v/s a stock market course where you get paid for years for something you have created once.

Converting your info product to a recurring subscription is the latest alpha out there - you cannot pirate a group unlike a video course. There's just more value in it.

Should you pull the plug?

As you can see, a SaaS business can be great or dumb for you - depending on who you are.

I personally would not suggest someone with ZERO software knowledge (someone in your team must know it) to start a SaaS - you don’t technically need tech knowledge to build a SaaS, but you might get ripped off by Dev agencies if you don’t.

If you are somewhat technical, with a clear marketing plan and niche to dive into, looking forward to grow the business a bit and then sell it - SaaS might be the perfect fit for you!

Want my help in growing/building your business?

I have two offerings for you:

My coaching group. Learn from a community of businessmen and get 1 on 1 coaching by me. We discuss business plans, ideas, and help you out regarding any problem you face.
My business guide . This guide has every piece of info you need to get started with your Wifi Money journey, you don’t need any other course if you study this.

More details of both the products are on the links provided - see you on the other side!

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