Without this, your product is doomed to fail

Without this, your product is doomed to fail(benhomie.com)

13 points by benhomie 13 years ago | 12 comments

neya 13 years ago |

I'm just a curious user - How can a start-up be profitable if it charges only a one-off fee, and that too only something as low as $50-$60? I think it's a very risky business model.

In my opinion, it's a terrible trade off and you're probably going to bite more than you can chew. Let me explain. For example, let's consider two apps A and B.

A charges a $50 one-off fee and B charges a $20 recurring fee. Sure, A will grow exponentially and you will appear to be instantly profitable, but it's a risk.

Think of this - You take $50 from the customer only ONCE this means, for the next two years, you need to pay for his support from your pocket. More the customers, more the support needed and more you will end up burning your pocket.

The problem with exponential growth is that it becomes static after a while and this is when things will become ugly. It will be a difficult situation because you can't switch to charging your customers monthly, because you've already charged them once. You will have very few options left then.

I can't imagine supporting a million users through a support system that I'm paying off monthly, but from an income that isn't monthly.

I think the best way would be to charge the customer annually like $99/yr or something like that..

This is a good read:

http://justinmares.com/why-real-businesses-dont-charge-5mont...

duiker101 13 years ago | |

But haven't businesses worked like that for like...forever? If you buy a TV(for example, even a cheap one) you don't buy it and pay recurring fees but it will still come with insurance.

siong1987 13 years ago | |

You don't have to worry about scaling it to hundreds of millions revenue a year if you are not running a startup.

In this case, it seems like the OP isn't running Sendy as a startup. He is working on Sendy as a lifestyle business which is making more than enough money for the OP and maybe more than some of us who are working on our own startups.

ujal 13 years ago | | |

I disagree here. If growth is the main factor for a startup, charging one-off fees guarantees you not to be delusional about your growth. It is actually much easier to get stuck with the recurring fee model, where you reach ramen profitability but don't grow as fast or worth - not at all.

EDIT: Actually the same psychological effects that push entrepreneurs to charge a recurring fee, push the customers to prefer a one-off fee.

Poyeyo 13 years ago | |

That's the reason we have Sublime Text 3.

lenazegher 13 years ago |

Late last year you mentioned RSS-to-email was on your roadmap. [1] Do you know when it will be implemented?

I've been looking for a dead-simple RSS-to-email subscription service for one of the sites I work for. The only offering I've found (and dislike) is from MailChimp.

[1] http://forum.sendy.co/discussion/40/rss-to-campaign-segments...

l-p 13 years ago |

I hope you fixed your security issues.

(http://redd.it/14o4ki)

benhomie 13 years ago | |

This has been fixed. A CA certificate bundle is now included in the build for curl to check against when connecting to SSL enabled URLs, so there'll be no more certificate errors even if a default CA certificate bundle isn't available on the server. Also, user inputs are sanitized, the code posted there are from an older version of Sendy. Thanks for the heads up.

duiker101 13 years ago | |

I do not see the connection between this and OP.

I am not saying you are wrong or else, I am just asking to point me to it because I can't see it.

l-p 13 years ago | | |

The reddit post is mine and was about Sendy (without disclosing its name).

visualR 13 years ago |

Why not a happy middle ground - $59/year?

critiq 13 years ago |

Thanks