Systems for Selling Recurring Revenue Products

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing

Recurring revenue gives the company several sales opportunities.

Here are the key systems to install for selling recurring revenue products.

New logos -- this process finds new prospects and acquires them as an initial customer.

New logos represent an expansion of the customer base by bringing in new users.

This customer acquisition system must generate awareness among new prospects.

Renewals -- this process seeks to retain existing customers by increasing renewals.

Maintaining existing customers comes from the successful use of the product.

The renewal process tracks the customers' usage of the product and looks to maintain the customers' engagement through customer success.

Customer retention comes from strong customer support.

Customer expansion -- this process seeks to sell more services to existing customers.

Recurring revenue companies have multiple products to sell.

This system proposes additional products to existing customers.

A good, better, best product offering helps with the upsell and cross-selling.

There are three systems for selling recurring revenue products: find new customers, renew existing customers, or sell more to existing customers.

Consider the system for each one of these for your startup.

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Let’s go startup something today.

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How To Add Recurring Revenue

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In addition to turning your core product into recurring revenue, there’s also adding additional services for recurring revenue.

Not every business can turn the core product or service into recurring revenue.

The next best thing is to add recurring revenue products into your business.

Here are some key add-ons to consider:

Support -- consider moving your support process into recurring revenue.

By charging a monthly maintenance fee you build recurring revenue and maintain contact with the customer.

This gives you the opportunity to upsell the customer to new products and maintain a relationship with them.

Training -- consider setting up a series of training sessions that continually train the customer.

This works well for enterprise customers who must continually bring new hires up to speed on your product.

Since this is an ongoing process, it can be set up as a recurring revenue sub-unit.

Upgrades and updates -- consider selling the upgrades on a recurring revenue basis so the customer receives new updates regularly.

Since products are often upgraded, this provides an opportunity to charge on a recurring basis.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

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How To Integrate Recurring Revenue Into Your Business

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In transitioning your business to recurring revenue you’ll need to make changes to your processes.

Here are some key steps in integrating recurring revenue into your business.

Reconfigure your product offering so it can be used on a recurring basis.

Update your marketing to promote the new product offering.

Highlight the benefits of subscription with additional values such as always available and unlimited usage if appropriate.

Set up commissions and incentives in the sales team to encourage selling the subscription products.

Update your website to integrate the purchase and subscription management into it.

Give the customer the ability to control their level of participation and ability to opt in and out online.

Set up product usage tracking so you know how customers are using the product.

For those who haven’t used it in a while you can reach out with promotional offers to regain their participation.

Set Up an online support process to handle customer requests through the website.

Move to automated payment systems using online services.

By automating the support, payment, and customer services, you can create a more efficient business process.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

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Example Transitions to Recurring Revenue

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Many businesses can be moved to recurring revenue.

Here are several examples of transitioning a business to a subscription.

Lawn care -- a repeat business that is often paid for by the hour or the visit.

Replace a variable pay for the service each time it is performed to a monthly payment for a fixed amount.

Pet services -- pets require grooming, walking, sitting, and other services.

Bundle grooming with pet sitting to create a monthly subscription service.

Property management -- properties require maintenance, rent collection, and more.

Consider bundling the services into one package and charging a standard fee each month for it.

Personal grooming -- hair, nails, and other grooming services must be done regularly.

Bundle a series of services into a standard price charged monthly on the credit card.

Education -- student tutoring, continuing education and more could be charged on a monthly basis.

Offer an annual membership in which the student is charged monthly for the service.

Extermination services -- extermination is an ongoing service required by many.

Consider setting up a standard service that recurs each month and charges automatically for it.

These are just a few examples of businesses that could be moved to recurring revenue.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

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In this episode of Investor Connect, Hall T. Martin engages with John Ashley, the CEO and co-founder of Auctus Surgical, to discuss their groundbreaking approach to addressing scoliosis. John introduces the company's innovative technologies aimed at improving the quality of life for young girls and women affected by this debilitating condition. With over 30 years of experience in the medical industry and multiple successful startups, John and his team are at the forefront of creating a device that not only prevents the spine from deteriorating but also allows it to grow and maintain flexibility.

The conversation delves into the challenges these patients face with existing treatments and the significant market opportunity for a more effective solution. John also shares insights into Auctus Surgical's journey, highlighting key milestones, funding stages, and future plans for commercialization. The episode wraps up with discussions on the science behind their technology, regulatory pathways, and the potential for this innovation to revolutionize scoliosis treatment for both children and adults.

Additionally, the episode features Charlie Kim, a scientific advisor and angel investor for Aridica Corporation, who presents their pioneering automated blood processing technology. Aridica's innovation addresses the labor-intensive and inconsistent manual process of isolating immune cells from blood, offering a push-button solution that enhances speed, quality, and scalability. Charlie shares his enthusiasm and investment in Aridica, highlighting the significant research and clinical applications of their technology. The discussion covers the current market landscape, competitive advantages, and Aridica's strategic roadmap, including plans for product development, clinical trials, and partnerships with major industry players.

For more information, connect with John Ashley on LinkedIn or visit Auctus Surgical's website here: https://auctussurgical.com/. To learn more about Charlie Kim and Aridica Corporation, connect with Charlie on LinkedIn or visit https://aridica.com/.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

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Steps for Transitioning to Recurring Revenue

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Once you’ve decided to move to recurring revenue you’ll need to set up a plan to switch your business process over to it.

Moving to recurring revenue can be done by following these steps:

Identify the services that are used repeatedly such as support, replenishment, and updates.

Recast these services into a recurring offering.

Consider moving your core value proposition to a premium product that requires a subscription.

The non-recurring revenue component could be offered as a free product/service to engage the customer.

Install payment mechanisms within the product.

Notify existing customers of the upcoming change.

Set a date for the launch of the subscription model.

Start the service with new customers first as they are not yet onboard so there’s no switchover cost.

Offer incentives to existing customers to move to subscriptions through discounts and other freemium products.

Set an end-of-life for the current product to move the remaining customers to subscription.

The process for most companies takes six to twelve months to complete.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

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Maintaining Recurring Revenue Customers

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

In a non-recurring revenue business, one focuses on finding new customers.

Once you have moved to recurring revenue, you’ll also need to focus on retaining existing customers.

To retain customers you’ll need to create a strong customer experience.

This comes from solving the customer's problem efficiently and building a relationship with the customer.

To solve the customer’s problem efficiently, you’ll need multiple price tiers so the customer does not overpay or look elsewhere for what you do not offer.

Price the product so the customer finds the best value for their money.

Make sure the recurring revenue fits the problem the customer must solve.

It needs to be a repeat problem.

Maintain high-quality customer service.

The customer in most cases has prepaid for the service and will expect a high level of support.

Keep your offerings up to date with the customer’s needs.

Recurring revenue models are constantly looking for new features to add and new products to offer.

Finally, update your metrics to capture the state of the business.

This includes the cost of customer acquisition and the lifetime value of the customer.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

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How To Switch to Recurring Revenue

Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing.

Businesses without a subscription model can move to recurring revenue.

Here are some ways to take your business and make it recurring.

Set Up a members-only section on your website.

Put premium content into that section and charge a recurring fee to access it.

Membership models help you build a community of like-minded people.

Once you have a base of customers with a common interest you can upsell to other products.

Move the repeat usage of your product to recurring revenue.

Set up automated charging as a first step and later move to monthly/annual contracts.

It’s not necessary to move the entire business to a subscription.

Charge an extra fee for the non-recurring services when they occur.

For physical goods, create a subscription box in which the product arrives on a recurring basis.

One can adjust the price based on the frequency of usage or how much is included in it.

Hardware services such as IT and video surveillance can be moved to recurring revenue.

The ongoing support, data storage, and analysis can be placed on a recurring revenue model.

This could also apply to IoT devices in which the device must maintain connectivity to the network.

Consider these examples when moving your business to recurring revenue.

Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.

Let’s go startup something today.

_______________________________________________________

For more episodes from Investor Connect, please visit the site at: http://investorconnect.org

Check out our other podcasts here: https://investorconnect.org/
For Investors check out: https://tencapital.group/investor-landing/
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