Vikrama Dhiman's Blog

If you are looking to start something, you don't actually need a million plus users (who pay you nothing) but a few hundred paying customers. Here is why:

• If you had 400 paying customers, paying you $10 a month, you would make $48,000 a year. In market terms, this could get you a valuation of a million easily. Isn't that just great for a startup?
• Sooner or later, you will need to demonstrate value to people who will be paying you. Why not do it sooner than later?
• If you are only focused on getting paid customers [and not the free ones], you'd be focused on one thing and your chances of doing it correctly increase significantly. Won't you want the lesser risk strategy?
• If you are making money, you won't probably need VC funding. How cool is that?
• Focusing on getting paying customers, helps you focus on entire value chain -> marketing, branding, sales, strategy, development and not just development. Why would you want local optimization when you can optimize for the whole from the start?

While this approach may not work in all scenarios, it is definitely an approach you want to consider while deciding your product strategy. It is not really revolutionary, per se - just ignored and not considered often enough, in this age of The Free Plan. Why?

• Perhaps, it is a bit too upfront about putting the money at the center of it.
• Perhaps, it is not as sexy as "we are building a platform for the future".
• Perhaps, it is the harder problem to solve and the human brain delays solving this problem for later.