Reverse Pitch | Every business will soon be subscription business: Sanjay Mehta1 min read . Updated: 03 Sep 2019, 10:53 PM IST
- Subscriptions are the new pricing model that generate a predictable recurring revenue stream for the service provider
Subscription economy has opened up new opportunities with startups. It is a big enough market and an opportunity for 100X.VC to fund them. Startups and large corporations alike are dipping their toes into the subscription business model.
The subscription economy is bigger than the sharing economy—it’s a significant shift in pricing from a one-time-buy to pay-per-use to now a fixed-fee monthly payment model for all you can consume.
At 100X.VC, we back startup founders with exponential thinking. The subscription business model has grown exponentially in recent years. We are excited to fund startups working on building lifetime value customer business model. Harvard studies have found that a 1% improvement in your pricing can add up to 11% to your profits.
Subscriptions are the new pricing model that generate a predictable recurring revenue stream for the service provider. The subscription business model helps you deepen your customer engagement as they have to renew your services every month. Research shows that overall, subscription businesses are growing revenues about five times faster than S&P 500 company revenues and US retail sales. Subscription companies grew 18.1% versus the 3.6% average for both the S&P 500 and US retail sales between 1 January 2012 to 31 December 2018. We believe that in the future every industry will become a subscription business. We have already seen success with Netflix, Spotify and Salesforce. Subscriptions are now a way of generating predictable revenue streams and, most importantly, a way of building strong customer relationships. At 100X.VC, we seek investment opportunities from entrepreneurs who are looking to build their startup with disruptive subscription business models.
Reverse Pitch is like a normal investors pitch, but with the roles reversed. That means the startup doesn’t present its business to investors, but investors and companies pitch their business concepts, challenges and the like to startups.