Bootstrapping and income stability (our revenue curve)

It’s likely that @patio11 is posting this much behind-the-scenes stuff because he has a newborn in the house, and is delirious from lack of sleep. But his temporary discomfort works to our advantage. :wink:

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Interestingly, I think you would be hard pressed looking at these graphs to say which ones were subscription products and which ones were ‘one off’ sale products.

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Yeah I noticed that also, I think primarily because the non-saas products all have a pretty heavy recurring component. Either support contracts or upgrades. SaaS didn’t event recurring revenue!

Whomever would do such a thing! :smile:

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What is more important than source and type of revenue for this discussion is VOLUME/SIZE of business - 50 sales and 500 sales is a completely different ball game! Note, that Andrey initially says “for those of you just starting out” so his chart is very relevant to those just beginning to collect revenue or in a small niche market. Some of the sales graphs posted by others for fast growing businesses seem to be for multiple years and so the revenue looks more stable, over time.

My own sales/revenue chart for HelpTeaching.com (established B2C) looks very much like @patio11 BCC chart up to 2013 (my growth continues at about 100-120% a year), with the heavy seasonal fluctuations you see based on school year that I have to budget against. I make healthy 6 figures in yearly profit.

After you find your early source of growth and continue building up other new sources, your source of revenue growth should start diversifying more and your revenue overall becomes more stable and predictable. For example, diversifying SEO strategies protects you from big impact of a Google update. I believe my decision to have ad-supported free content on top of a subscription product goes a bit against common wisdom, but it allows me that diversity of growth (free content > links) so important for a lifestyle business.

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My sales/revenue chart for HelpTeaching.com (also B2C) looks very much like BCC chart up to 2013 (my growth continues in 2014), with those heavy seasonal fluctuations based on school year that I have to budget against.

"because the non-saas products all have a pretty heavy recurring component"
This is especially true for monthly plans so common in B2B SAAS products. Many B2C SAAS products have yearly plans and recurring revenue is lower, often due to fast expiring credit cards as well as changing consumer needs.

Patrick,

Any ideas what has caused the dip in BCC sales since 2012?
-lack of attention from you
-Google algorithm update
-competition
-aging product
-something else?

I understand if you would rather not say.

I think Andrey’s chart is probably more than a first year chart FYI and is showing the ups and downs his business has had over the long term. Unlike most of the rest of us who posted charts, his shows a huge market shift. The introduction of the iPhone which disrupted his primary Blackberry product business.

Our primary product doesn’t have monthly plans, it’s yearly support after an initial license purchase. However, it’s the type of market that requires a heavy training investment and deep integration with other systems so there’s a high lock in factor. Not something we in any way force, nothing specific at all to our platform simply the nature of an enterprise system.

I couldn’t possibly have less interest in B2C :slight_smile: Maybe a flyer type product, hey we build a mobile picture taking thingy. Fine. But to try and build a real business on B2C. Yikes. Even our other product Snappy which is focused on small businesses is really too close to B2C. I’m finding that in many ways it’s acting like a B2C product more than B2B.

B2B4LIFE

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Oh all that said, your app looks great :slight_smile: Might have use of it myself in the future.

Totally my bad for implying Andrey’s chart was for a small volume - I meant to say that early on those type of variations a more common regardless of the business type but of course they happen later on as well due to various factors, as you pointed out. Thanks for correcting me.

I know B2C isn’t popular for lifestyle business fans (aka micropreneurs), and I would probably not recommend it myself, but I am not complaining since it’s working out for me. I am also looking to expand into B2B myself :smile:

The proximate cause is that Google sends less traffic, both organic and from AdWords. I haven’t investigated why that is in any detail, as the rest of my business interests make it economically irrational to do so.

I know a few people (including myself) who have lost organic traffic after Google algorithm updates. But I haven’t heard anyone telling me their traffic increased. I wonder where all the traffic went? Buzzfeed perhaps? :0(

The two updates I can think of that had a noticeable-from-the-outside shift was the one that favored frequent updates over almost everything else (this seemed to favor blogs more than anything), and one that seemed to shift the focus to factual authority, which shoved Wikipedia, Stack Overflow, and sites like that way above everyone else when applicable.

The other updates shifted things around obviously, but it was much less obvious who was the favored class in those.

I had an increase in referral traffic with a simultaneous decrease in organic traffic when the algorithm changes hit my sites. The increased referrals came from WordPress.org because the repository links were favored in Google’s eyes, and the net was a wash for me, but it did increase overall conversions (this is how I noticed) because the traffic was better qualified once I came from “reputable source”.

Here’s mine! My revenue is still pretty low and I’m not even doing this full time yet, but it’s moving in the right direction!

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I kept debating whether I should participate in this thread of not since I’m ultimate trying for reputation in a community rather than income directly, but screw it. This is traffic, not money, because the site purposefully makes no money currently. I also did not directly obscure any data since it’s not money and isn’t in any way sensitive.

It’s very bursty as I find/use new places to publicize it. The traffic hasn’t been particularly sticky, and I’ve mostly been trying to solve that problem.

I don’t have a good graph of income, but here’s 7 years of traffic stats for Video Game Countdown

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For any business older than 5 years, I’d be more interested in what your profit curve looks like. Revenue doesn’t mean a lot to potential investors or acquirers for a mature business.

Variable revenue is one of the biggest downfalls of building a bootsrapped company. This is why SaaS has become so popular (and successful). The most important element in a successful boostrapped company is recurring revenue. Whatever your business, do whatever you can to switch over the model to recurring.