I Build a Startup: EP02 — The Business Model
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In life, balance is everything, and even a great idea, executed well, isn’t viable if it lacks economic balance.
It’s crucial to clarify this early in your project to see if the financial equation adds up. Launching a project without a clear vision of how to fund it risks being a huge waste of time, money, and motivation for your future endeavors.
So, we embarked on the idea of a new social network, and there are multiple monetization avenues. The most common and widespread is advertising, a classic route. There’s also the emergence of paid accounts on platforms like Facebook or X, and, less ethically, the exploitation and resale of personal data.
Let’s rule out the last option; exploiting my users’ data is out of the question. They’re already exposed enough as it is. That leaves us with advertising and paid accounts.
Eliminating data sales means the user is no longer the product, so charging a subscription fee seems fair. But how much? In my opinion, it’s crucial to stay under 10€, or even 5€. At 5€, it equates to the cost of two coffees a month, which is reasonable.
Now, let’s talk about advertising. Yes, it’s annoying… but how else can we fund the platform if users don’t contribute through a subscription? At the end of the day, someone has to pay the bills!
So here we are, the platform will generate revenue through advertising for free accounts and a subscription system for paying users.
That’s a significant milestone achieved; now, we can move on to the next steps!
