Sterling Terrell

Starting a subscription based business makes complete sense.

I mean, recurring revenue naturally has more stability than project-based work that many get caught in.

The same way that newspapers and magazines would rather sell subscriptions than issues one at a time, most would prefer a full-time salary to getting paid by the hour.

Heck, even I am less likely to want to work with a particular brand on a one-off basis.

If you want to work with me, I would be more likely to tell you that $1,000 per month gets you 5 hours per month of my time.

This entire idea can be tied back to dividends from investments.

See, predictable dividends hold more value than unpredictable ones.

Of course if you are doing content, my advice is to just give it all away for free and sell something to your audience at a later date.

If you don’t give it away for free, someone else will soon.

But it wasn’t just our strengths and passions that led us to software; the financial side had a big impact, too. The revenue we earned from subscriptions had superior gross margins, far less time investment perdollar earned, and required very little hiring or contracting compared to our consulting work. We discovered through trial and error what financial markets have known for years: the dollars earned from a recurring revenue model are vastly more valuable than dollars earned from services, thanks to scalability and margin.

-Rand Fishkin, Lost And Founder