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Turning your idea into a business
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Roan Lavery
May 27, 2009
Technology
1
110
Turning your idea into a business
Presented at the Future of Web Apps 2009
Roan Lavery
May 27, 2009
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Transcript
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Turning your idea into a business Roan Lavery
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The plunge
Who needs a business model anyway? - Dick Costello, Feedburner
http://www.burningdoor.com/askthewizard/
Who needs a business model anyway? - Dick Costello, Feedburner
http://www.burningdoor.com/askthewizard/
Who needs a business model anyway? - Dick Costello, Feedburner
http://www.burningdoor.com/askthewizard/
Who needs a business model anyway? - Dick Costello, Feedburner
http://www.burningdoor.com/askthewizard/
Who needs a business model anyway? “With this kind of
traffic, we'll figure it out” - John Doerr, Google Board - Dick Costello, Feedburner http://www.burningdoor.com/askthewizard/
Web app business models Advertising 34% Subscription 14% 3rd party
supported 14% Long game 6% Payments 32% http://www.boxuk.com/blog/monetizing-your-web-app-business-models
Free love
The psychology of free
Free love? Critical mass Advertising down User costs Bandwidth Storage
Support Scaling
The problem with free is that every time you double
the size of your database the cost of maintaining the site grows 6 fold. The bigger you get as a free site the less money you make per visit and the more it costs to service a visit.” “ - Markus Frind
Make ‘em pay
Individual Business ~ x 10
None
= £48,000 a year 200 users @ £20 per month
= £4,000 a month
4000 users @ £20 per month = £80,000 a month
= £960,000 a year = £48,000 a year 200 users @ £20 per month = £4,000 a month
4000 users @ £20 per month = £80,000 a month
= £960,000 a year CHA CHING!! = £48,000 a year 200 users @ £20 per month = £4,000 a month
Topical Geographical
Topical Freelancers in service industries Geographical
Topical UK based (mostly) Freelancers in service industries Geographical
http://www.omnisio.com/startupschool08/david-heinemeier-hansson-at-startup-school-08
Freemium
conversion rate = 2.5% cost per user = £2 a
year
conversion rate = 2.5% Total Users 160,000 cost per user
= £2 a year
conversion rate = 2.5% Total Users 160,000 cost per user
= £2 a year 4000 paying @ £20
conversion rate = 2.5% Total Users 160,000 cost per user
= £2 a year 4000 paying @ £20 156,000 free
£960,000 - £320,000 = £640,000 conversion rate = 2.5% Total
Users 160,000 cost per user = £2 a year 4000 paying @ £20 156,000 free
March 2007
May 2009
there it is! May 2009
Freemium Subscription + free trial Daily Sign ups Revenue
Lessons learned Find your niche audience Charge people! Be careful
about what you give away Be creative with business models Agile business development
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Any questions? Roan Lavery
[email protected]
follow: @roanlavery & @freeagent http://www.flickr.com/photos/guy_incognito/47600607/
http://www.flickr.com/photos/picsandpics/3395713506/ http://www.flickr.com/photos/digitalsextant/1806620459/ http://www.flickr.com/photos/15589195@N04/2128900152/ http://www.flickr.com/photos/drb62/457354545/ http://www.flickr.com/photos/greenshock/44793290/ http://www.flickr.com/photos/bebebeaux/2956060052/ http://www.flickr.com/photos/undaunted/488622130/ http://www.flickr.com/photos/ihtatho/627226315/ http://www.flickr.com/photos/ciordia/2241906999/ http://www.flickr.com/photos/lucy_baxter/3326890764/ Attribution