[muzani]

Don't eat unicorn food if you're not a unicorn. Here's a litmus test - do you think $5 million is a lot of money?

If yes, then do it. Whatever gets you to $5 mil the fastest.

If no, then don't do it. You'll run out of customers to milk and not be sustainable.

[HenryBemis]

Or.. to counter that. How many people are working there, and how many people own that company? What is your 5-10-50 year strategy? Get a $20k salary per month till the end of time and live a long happy life, or sell it to GigaCompany for $1bn and go buy an island and retire at the sweet age of <insert_your_age>? Do you plan to expand? Milking the customers for as much as you can is a great(?) idea, but risking your customer base "because I want to go from $100k salary per month to $101k salary per month" is reckless imho.

[muzani]

Selling for a fixed price has worked for decades. Microsoft did it. They made money, used the money to make new products. Early cash is good.

The whole SaaS ARR model was popularized by VCs because it's easy to calculate and a healthy indicator of exit size.

The logic falls apart if you're not VC-backed – there's no guarantee that 5 years from now, customers won't switch to the competitor that has $100m in funding.

Also by playing the one time purchase model, you're pricing it below what the big guys can sustain. You strip mine the market from the competitor, while offering the customer a good(?) deal.

It opens up some markets too. I used to sell SaaS to construction projects, and they preferred to make a single purchase far higher than LTV because it's easier to get the budget approved and "own" the system.

[bruce511]

I'll counterpoint somewhat.

Our business started by "selling copies". We are bootstrapped not VC (or otherwise) funded. We started with one person and grew.

Around 2010 we were becoming victims of our own success. As the existing customer base grew, sales had to grow to pay for ever-larger support staff. Not to mention ongoing development costs.

Yes we charged for upgrades. Yes we charged for some support (some companies were on contract, others were ad-hoc) but upgrades and contracts were optional, ad-hoc was an admin pain.

We switched in 2011 to a SaaS model. Under this model we are sustainable even if new sales drop to 0. Which means existing customers are funded from existing customers. Since support is now directly funded, it can be scaled up as customer numbers grow.

I should mention, we are in the Business not Consumer space - support is a big part of what we offer.

We stopped selling a "one time pay" option. We do let people self-host or we can host for them.

Yes, there are likely some number of possible customers who won't buy because of our model. For us that's OK. We don't need 100% of the market. What we need is to serve the customers we do have, while growing in a sustainable way. We cannot be dependent on "new sales" in order to keep the lights on.

What is interesting is that because it's funded, our support is the best in our industry. We pick up customers from competition because of our support reputation.

But of course each market, context, product is different. YMMV.

[HenryBemis]

There are a lot of moving parts to your reality and my question. If you are flying solo, already banked $10m from this thing, you can sell it for $10 and never go hungry and your kids (if you got don't know/I'm not asking) will also be set for life.

As a user (again, I may be a cheap bastard) I love a "pay once - have forever". I assume your SaaS is not for commercial/business use, you mention "price sensitive hobby market". If you price the 'runs offline' at $10, good luck to your competition to beat you.

Also, if your market penetration is steady and linear at 0.5% per month, and you are just on the first 5%, then that's a different timeline/decision process.

There are so many thoughts I got for this (as an 'internal/me mental exercise'). I hope it all plays out well for you, and you decide what's best for you and your business :)

Thank you for responding and giving me that POV.

[bigscrankus]

The app has made 1.4 million dollars over 5 years. So a solid salary. Nothing near financial escape velocity, but I’m grateful for the freedom.