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The line of reasoning goes, “Services businesses are not scalable and the market won’t reward this revenue so make sure that third-parties do your implementation or clients do it themselves. We only want software revenue.” If you’re an early-stage enterprise startup services revenue is exactly what you need.
The founders and team develop a huge confidence level that appropriately increases risk-taking, output, expansion, deals, revenue, press and everything that is a consequence of initial successes. Or some teams who start driving revenue paper over the fact that they aren’t acquiring customers profitably. Your churnrates are too high.
Thanks to Adam Wood, Revenue Geeks ! #7- Many businesses are discovering that the key to successful marketing is interacting two-way with customers, not simply shouting marketing messages at increasingly dilute audiences. . With rising costs due to inflation, more businesses are laser-focused on revenue than ever before.
You have a low churnrate and you are in the business for last five years at a minimum. How much revenue are you generating on an annual basis? If you are getting funded for the first time, which means that you have not diluted the shares of your company, you will be receiving Series A funding. Growth stage.
I would focus on one product and set a goal to generate $1M in yearly revenue from it. Outsourcing is something a big company, with a known customer / problem (that has revenue & traction) does to save cost. I have a proposal written up including full cost and revenue projections. So, should the success rate matter?
Since I see a few common patterns of mistakes, I thought I'd add to the LTV literature and point out the top three reasons many investors roll their eyes when they see entrepreneurs present inflated, poorly constructed LTVs: 1) Your churnrate is understated. A monthly churnrate of 1%? 2) Your cost of capital is too low.
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