Recurring Revenue

Recurring revenue is the business models that I prefer. It has the benefits of being highly predictable over time, and reducing the stress of having no revenue at the beginning of a quarter unless you go out and make new bookings. The major disadvantage to a recurring revenue business model is that it starts slowly and will require more cash to get it going.

Please refer to these two blog posts that talk in detail about the recurring revenue business model:

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  • Joe

    Hi David,

    I am looking for a MRR model that will help me determine margins based on hardware, and perpetual licensing.  Do you know where I should look for that?

  • http://www.forentrepreneurs.com David Skok

    Joe, unfortunately I can’t help you there. I am not aware of any model like that. Sorry!

  • http://www.natlus.co.uk/ management accountants Oxford

    Normally a very small business will commonly need straightforward accountancy help and

    assistance with their bookkeeping and tax issues.

  • Radu Meghes

    Hi David,
    Any idea when this article will be finished? I am working on a SaaS startup and could really use some validation/guidance for my business model.

  • http://www.forentrepreneurs.com David Skok

    I have just completed it for you.

  • Radu Meghes

    This is awesome David. Thank you very much. I really appreciate the work you are doing in helping others learn how to approach the startup phase.

  • Adrien

    Hi David, I am scaling my company internationally and have to work on a new business plan. Would you have any framework” for a SaaS enterprise software business plan with international operations ? Thanks a lot.

  • http://www.forentrepreneurs.com David Skok

    Sadly I don’t have anything to help you there. However ask these guys: http://www.hsp.com
    Best, David

  • Paul Braun

    Hi David,
    Wondering if you have any best practices for sales compensation models when you are selling both hardware and SaaS based subscriptions?

  • http://www.forentrepreneurs.com David Skok

    Hi Paul. I don’t for that specific situation. But a good group to talk to are The Bridge Group. You can see some of their work here: http://www.forentrepreneurs.com/metrics-and-compensation-for-saas-inside-sales/

  • Will McCambley

    Hi David,

    I work for an online education company (think codecademy). I’m doing what I can do use inbound marketing, but I also have an ad budget. Do you have any recommendations for places and ways to advertise?

  • http://www.forentrepreneurs.com David Skok

    Hi Will, unfortunately that is not an area where I have any expertise. I know that my portfolio companies usually start with Google Ad Words and work their way through things like LinkedIn and Facebook. Always starting small and testing the waters, and then doubling down on the things that appear to be working. For Google searches, there is often value to using an expert to find the optimal combination of long tail terms, and times of day, location, etc.

  • Will McCambley

    Thanks for the reply David. The blog has been an enormous help.