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Ask HN: How much recurring income do you generate, and from what?
444 points by marioluigi on Sept 23, 2013 | hide | past | favorite | 430 comments
The last two threads by the same name got a lot of attention (and a lot of love from patio), but seeing how its been over a year since then it would be interesting to hear from new people (HN userbase is ever growing) and also get updates from some people who posted in the previous threads.

Previous thread: https://news.ycombinator.com/item?id=4467603

Previous to Previous thread: https://news.ycombinator.com/item?id=2567487




TL;DR: The top of our funnel is fine, and our app is making money, but it's not "easy money" and our trial to paying customer sign up needs some serious attention.

I run a HR app for SMEs called http://www.staffsquared.com. We're making a comfortable 5 figures each month.

We're reinvesting this income back in the product either in the form of new functionality (paying programmers) or advertising (paying Google Adwords). We've increased our Adwords spend, invested in SEO (on page and off page) and a recent redesign saw a decrease in bounce rate and increase in trial sign up rates.

Our site visit to trial sign up rate for the last five months looks like this:

April: 13.02%

May: 12.37%

June: 13.76%

July: 15.61%

August: 16.46%

Our bounce rate for the last five months looks like this:

April: 39.54%

May: 40.06%

June: 37.21%

July: 32.8%

August: 31.17%

So both of those top end of the funnel stats are moving in the right direction.

Our free trial to paying customers is the area we're really focussing on at the moment as it's really not high enough. So we're re-targeting accounts that have expired to find out how we can serve them better and tell them about new features. We're also working hard on our onboarding stuff (the type of stuff you'll read patio11 talking about) including more intelligent automated e-mails based on the status of their account at a point in time.

Happy to answer any questions you good people might have where I can...


Please share anything you can about how things go in the future. I'd love to see how your dunning emails turn out. Can you also share some background? When did you start? How many people are on your team? What kind of initial investments did you do?

Really awesome to see people being so transparent about how they're doing.

By the way, if you ever want to write any blog posts and cross-post them to Lifestyle.io [0], we'd be happy to have them.

[0]: http://www.lifestyle.io


If there's a demand I'd be happy to share our lifecycle email updates...either way I'll be sure to keep track of our progress so I can report on it from time to time. Getting the onboarding process exactly right really is a combination of art and science (mostly science).

We launched Staff Squared about 18 months ago, it was originally an internal app that I used at my software company http://atlascode.com that we realised could be useful to other companies. We bootstrapped the app from the outset and haven't taken on any investment as I wanted to see if we could make this thing work first. Turns out it's possible to make a profitable business from it but it's by no means easy.

I do pretty much everything...sales, marketing, support, QA, specifying new features, and so on. My team of devs at Atlas consists of four full time .Net developers. I now also have a part time person who helps me with marketing, newsletters, copywriting and design. Our office manager assists with some of the support requests we receive and manages our oLark chat on the site...

We're looking to grow now and take on more developers as I'm finding it hard to balance the client work we've got at Atlas and keep Staff Squared "fresh". All good problems to have :)

I'll check out lifestyle.io and see if I can contribute something of use to that community. Thanks for your interest!


Apparently "SME" means "Small & Medium Enterprises".


Thanks for this clarification, as I'm used to SME meaning Subject Matter Experts (which also applies to the product).

BTW, the Staff Squared homepage is really impressive! My eyes are directed to all of the right places on the page to sign-up and learn more. I also like that clicking the Roadmap link on the footer leads directly to the Trello project page.


Thanks so much for the feedback, really nice to hear that people who haven't seen the site before think we're doing it right :)

For the record, if anybody thinks we've made a huge mistake on the site I'd love to hear about it!


Not a huge mistake at all but shouldn't the email address box say "No card details required" instead of "require" http://bryan.cx/7OXv/K6kIrX0S


Yep, thank you. I'll get that fixed.


Ah yes, you guys refer to it as SMB I believe?


No, I don't use either of those terms often enough to have an acronym for it.

(FWIW, apparently "SMB" means "Small-to-Medium Business".)


Or "Super Mario Brothers".


Oh yuck, I thought of Server Message Block first. How dull is that?


Simon, Thanks for the great insight!

We are also targeting SMB sith a SaaS in a different area (sales): http://www.quotty.com.

We haven't still defined a strategy, but your comment caught my attention because we are facing the same issue. Your application is innovative, how do you announce it? I figure that hardly somebody will search for an application like yours that nobody figures exist?

In summary where you get most leads: keyword search, organic search, partnership, ads placed in industry blog? Did partnership generate results? With other software? With distributors?

Another issue we found is that many users are too lazy ans inexperienced for the trial disert. I am conducting the following experiment: instead of immediately sending a free subscription-trial password, we ask for a phone number that we will call to make an interactive (remote) demo of the product using real client data, This has improved results, but elevated cost.

Don't you have the same training problem with new users?


How do you market StaffSquared? You mentioned SEO and ads; is this your main source of customer acquisition?


We're currently number 1/2 for "HR software" (at least on google.co.uk) and so we get a lot of traffic from that. I'm working on getting us to rank for HR Systems which gets just under half the amount of traffic as HR Software.

We have a limit of £30 per day on PPC. It drives traffic to the site but I'm still getting under the hood of whether it delivers real ROI.

We get a lot of interest in our app from the Chrome web store. I think a lot of people overlook that as a (free!) place to market their software. They have a whole section dedicated to HR software and the majority of the time we're featured at the top. We're going to get listed on the Google enterprise marketplace soon too.,

A bunch of other stuff we do includes:

* Advertising on various HR blogs

* Partner marketing - I could write a whole post on just this topic, it's a big undertaking

* Writing guest posts

* We're trialing influads.com at the moment, which is an ad platform. Again I'm not sure if we're getting value from that just yet...

The one thing we've not done to date is press releases. We've performed exactly zero PR for the app, but that will change once we complete a few super cool features we're working on that I feel will set us apart.

Hope that helps!

EDIT: Formatting


The chrome web store is a great idea. Does the chrome app provide any additional functionality? Or is it primarily a link to the web app?


When people "install" the app from the Chrome web store it just puts a link in their browser. That's it.

In the Google marketplace it's a bit more advanced, and you can integrate with Google authentication for sign in, and with documents for document sharing and so on.


I think you might consider changing some of your cartoons so that a Woman is running the business. I think it's a bit strange[1] that it's the male character all the time.

I don't know if that's something that might turn off a woman, but it did sort of jump out at me.

[1]Full Disclosure:I only browsed through a few pages, I did not to a page by page gender analysis.


This is very interesting. Thanks for sharing and best of luck!


Thanks for the info! Just a heads up: seems like your Twitter account is suspended.


Yeah we know, happened yesterday. Thanks for the heads up..

To explain: I was experimenting with an app that it turns out breaks the twitter rules and so they've suspended us. I'm talking to Twitter now about getting us unsuspended.


And we're back online again! http://twitter.com/staffsquared


Followgen? Experimented with it and although provided some value it ultimately got our account permanently suspended.


Holy shit really? Yeah it's followgen...I've e-mailed the owner and revoked his access to our twitter account.


What was the app? Tweetadder or something?



Thanks for sharing the past discussions. The more often we can talk about this, the better off the community can be.


First link is to 9/3/2012, not 2013 as labeled.


I'm just going to post this question every day, since it seems to be so popular on this site : )


I'm making roughly $300/month from three iPhone apps. They're all quite simple and I'd estimate that I've put in less than a month's actual work building them; although as a disclaimer, this is my day job so I can put these together relatively quickly.

My fourth app was a larger time investment and gets quite a lot more downloads. It makes no income now, but I'll add In-App Purchases soon.

I'm freelancing for ~45 hours a month to fund this while backpacking all over the world. I should blog about it.

---

Edit: I put up a LaunchRock page, if you would be interested in a blog about this stuff, leave me your details: http://theoreticalblog.launchrock.com


Please do blog about it. Freelancing while traveling is a concept that a lot of us are really drawn to, but most of the current blogs focus on the travel and only briefly mention the freelancing aspect. Maybe if you focused a bit more on the business side of things you could find a niche within the blogosphere.


Having just traveled around the world over 7 months but NOT freelancing, I would have to say that:

  * net connections are very very spotty,
    prepare to work offline

  * supplies are rare (usb devices, upgrades, etc), 
    expect to pay more for less

  * desk conditions are poor, rarely did we 
    find a place where I could get into the flow. 
    Checking email and noodling on the net was 
    fine, but getting real quality work done 
    requires spending time to find the right location.
I think it could be possible, I have written some of the best code of my life in a corporate budget hotel holed up for a week with only a 1Mbps internet connection.

You can simulate work/travel by playing with IPFW settings on your mac and only working out of a macdonalds.


Pretty accurate. But you can mitigate this by 1) sticking to the kinds of locations where you know you'll find a decent connection, e.g. Thailand, and 2) pausing when you find a good setup and working for extended periods to make up for poor conditions later on.


Totally agree. The locations that are most conducive to "the flow" also have internet that is worse than non-existent. I have learned to just shut it off completely rather than sink time trying to get blood from the turnip. Local copies of documentation and projects that take little outside research also help.

When going on another extended adventure, we will definitely stay in one well scouted location for awhile (6 weeks to 6 months). Nothing ever gets dialed in if you're moving all the time.


1Mbps internet connection is what I'm used to mostly :/


Thanks for your encouragement, I put up an email form if you're interested in reading more about this: http://theoreticalblog.launchrock.com


Telling people that you should blog makes it actually less likely that you will actually do it. Read that on some psychology website once. ;)


In this case I have to disagree, as these positive replies are removing any concerns I had about nobody reading this hypothetical blog :)


I would read it. As you are seemingly living my dream I would love to do a bit of vicarious living through your blog. :)


I read in Influence [0] by Cialdini that telling people you're going to do something actually makes it more likely you will because you feel consistency pressure

[0] http://en.wikipedia.org/wiki/Robert_Cialdini


Anyone recognize this phenomenon by name or have a link?



most people are familiar with this notion due to this post: http://sivers.org/zipit

tl;dr “Symbolic Self-Completion"


I've long noticed this in myself. Very neat to see it isn't just me.


I kinda look at it like a lean startup practice. If nobody signs up for his blog why start? if some people sign up there will be pressure to put something out.


Causation vs correlation


Would you mind sharing some more info about your apps (i.e. an overview of the concepts)?

As someone who has tried (and struggled) to monetize personal projects, I'm always interested in hearing stories about independent apps that are financially successful.


It sounds like you are living my dream. Care to share any details about how you got into that? I work (and enjoy working) at a big company right now but I feel like down the road I will want to do something like this.


Take a look at my edit above - I'd be happy to share more about this stuff.


I've usually read these threads without thinking about my own situation, but suddenly realized, I'm getting checks every month. It's not much, only $100-$250 per month, based on advertisements on my youtube channel, most coming from a 24 part series I made on locks & lockpicking a few years ago, but it's passive to the point that I literally forget about it.

Unfortunately I'm the sort who is very uncomfortable asking for money, or even advertising on my content (only about 50% of the videos I put out have ads at all, and many of the most popular do not), but at the same time I'd love to have the time & resources to produce more & better content in the future.

Not looking for advice, as my disposition away from revenue is much stronger than my wish to get money, and I've learned that lesson many times, just adding another voice to the thread.


I am a lot like you temperamentally and currently homeless, though the two things are not really directly related. I have thought a lot about it over the years. For me, part of it is that I was one of the smart kids in high school and got a lot of not subtle messages about how I owed the world benefit for my gifts and would be evil incarnate to try to, gasp, get rewarded for them. For me, I think gender also plays a role. I am female and a lot of my strengths have a social element which is routinely treated by other people like I owe them some free motherly love, I should be a total fucking martyr about it, and, to add insult to injury, making people feel good is not some sort of intelligent, valuable skill set or knowledge. It is treated like I am just cute and lovable like a tribble.

I have my own ideas on how to solve these issues for me. I sm not giving you advice here. Just saying it resonates, fwiw.


I would recommend not being so open and candid, emotionally and concerning life events, on the internet. This is doubly true when your handle is linked to your photo, location, and real name.

I wouldn't hire you for freelance work due to your seemingly incredibly unstable situation.


Thank you for your concern. As is typical, off the cuff advice about something you know almost nothing about isn't going to be useful to me. Your remarks smack of jumping to conclusions, probably very erroneous conclusions. Arguing about the particulars is not likely to do either of us any good but I am also not comfortable letting your characterization of me stand. Suffice it to say, your opinion has been noted and I plan to continue to be emotionally open as well as open about my life. My financial mess is getting cleaned up. I am clear I am on the right track.

I hope you have a great day. The world would be a better place if more communication came from a place of concern for another person's welfare. I hope you do not stop caring about other people. Although the road to hell is often paved with good intentions, I believe it is usually due to good intentions combined with poor execution. I think execution is easier to fix than a cold heart.

Take care.


It's worth a lot, and while I am not female, and can't fully empathize, I would like to say that I at least sympathize and that I see and try to speak against what you are describing. Women in particular seem to be taught not to profit. In fact, I think on the other side of the equation it is part of what has been awkward for me. Many of my closest male friends see profit as part of their self-identity and it wasn't until your post here that it clicked for me that it may be related to gender identity.

So, like I said, worth a lot. And making people feel good, caring for people, it's the most valuable skill so far as I'm concerned. Glad there are other people who value it.


My situation is complicated. I am not making much money but I am "saving" millions kind of by not being sick. Long story. So can't really be too terribly unhappy about it. At some point, the dough will role in but I will know I am doing stuff I am okay with...etc...

((hugs)) & take care.


Now that's interesting. Please do share more about your disposition away from revenue. What does that mean to you?


I'm trying to think how to explain it without using anecdotes, as I want to understand it myself without punting to simile. I know that I undervalue the importance of money in my own life (I have been poor to the point of homelessness once, poor the point of selling possessions to get rent/food money a few times). I also undervalue my worth, almost never charging an appropriate amount for my time.

I've cultivated a niche expertise that I translate well to a wide range of communities, but when asked politely I tend to give my time and even tangible goods away for free.

Now, I'm actively trying to change that. I'm getting married next year and am very excited to have a family in the relatively near future, so I'm paying off debts, I re-entered the workforce at a decent salary, and have been trying to train myself to be comfortable asking people for money in exchange for my time & expertise.

It has been harder than you might imagine, but I'm making progress. Being able to externalize the need to earn money via the idea of a future family has helped me, but I remain very uncomfortable asking and often find myself under-reporting hours spent, transportation costs, etc.

If I could just produce content, conduct research, give workshops & lectures & have someone else handle the money, I would be in heaven, but the few people I've spoken to about it, despite initial enthusiasm, have never followed through. Considering my own disposition, I obviously don't blame them at all :)


emhart This just went on HN front page: http://blog.quoteroller.com/2013/09/19/uncomfortable-convers...

I read your comments here and then I saw it. I think it is a sign :)

Seriously, I am not sure this aproach will help you. It looks like to me that it is more about "why do it" than "how to do it". I think what you should do is put yourself in a position where will just assume you will charge for it, so you don't have to say "oh, I would like you to pay for that".

But that wouldn't help with you refusing to charge for long hours. But you may consider a transparent aproach for it. Why not sending an email asking your clients if they feel confortable with you charging some extra hours. If they complain, you don't charge, but I guess some may accept it and even enjoy if they are rewarding a good job. This way it is no more a binary "I don't charge and they never know/I charge and they don't like it". There is a dialogue about that may substitute any confrontation.


I appreciate you sharing the link, I missed it on the front page. How fitting! :)

And I also appreciate your thoughts. Thank you.


I am like you. Recently, I was given the advice (by someone who the advice was working for well) to hire a business manager. You do what you are good at (producing content, conducting research, giving workshops & lectures) and they manage the business. You need to be able to trust them, but assuming you can find somebody like that and afford to pay them, it makes a lot of sense. Perhaps there should be an app for that (outsourced business management??).

Best of luck to you :)


I'd love to! But, the 3 people I've approached about it so far have all failed to work with a single lead. Literally I'll forward them an email asking me to come speak somewhere, and they never communicate with the person or me about the work again.

If anyone on HN wants to start a speakers agency for tech/security folk, I'd be first in line to sign up :)


I'm interested in your need - in your example, you have a verified, paid speaking lead and you need someone to line up the work for you, get it billed, maybe find you other leads, what else? I'm not going to promise anything other than to think about your need and see if I can come up with a simple solution (I have an idea in mind). If you'd like to email about it, send me a note - noj AT dimensionsix.com.


Relevant new Wondermark comic: http://wondermark.com/969/


The person asking you politely for free work is probably someone good at sales and manipulating people. In other words, you aren't doing them a favor. They see you as a sucker. You sound like a nice guy, and everyone assumes most people are like themselves. But in business there are tons of wolves in sheeps clothing. The line of people who will take advantage of you will last longer than your life on earth. So you have to learn communication, and learn that you bring value and they should pay what they agreed to pay. Invoice them for the full amount, and don't give them any freebies unless either they complain (even then they need a good reason), or at the very least they have to know that you are trying to do them a favor. If you do free work and they don't even know about it, you have just shot yourself in both feet. You remind me of me. I speak from experience. It's not easy, but it is worth it.


Hey, halfcat, I hope you revisit this thread and see this, but you are apparently hellbanned (only those of us with "showdead" on can see you. I actually can't imagine why, your comment history all seems pretty reasonable. Anyway, figured I'd leave this here to let you know. Good luck.


Also maybe read some of Ramit Sethi's stuff. He has a book and tons of stuff on his website and YouTube.


Not the OP, but I can put forth that perhaps it's an ethical dilemma? Objections could be raised to collecting money without expending effort. Similar to objections to copyrights that last indefinitely.


I do think that it has some sort of knurled ethical/moral center in the middle there. It's definitely an emotional response, but logic & emotion are at odds on this one for me.


That's a cool idea and I made only 1/3 of that.

Made about $200-$350 every 3months investing no time at all. Last year I started feeling bad, because I didn't do anything and made the menu free. I wanted to sell other stuff, but never had the same motivation to be honest.

I made a menu for a customer, then decided to sell it for $1, but the system didn't allow that (no micropayments). So I just made a dozen additional colors of the menu using Photoshop and sold it for $15 for 2y.


I didn't post on the last threads I think, but I have had some modest success with passive income, was making up to 700 euros a month 2 years ago, this is down to 130 euros a month now. Still not too bad considering I haven't really touched the site for almost 2 years. But my heart isn't in that kind of projects anymore. Passive income is a bit overrated in my experience.

Still nice to get a small check at the end of the month.

The site in question is http://www.giftcertificatefactory.com, it provides printable gift certificate templates.

EDIT: I should add the money comes in from Adsense. I tried other monetization schemes as described there http://www.sparklewise.com/my-first-passive-income-project-o...


After reading your post last year, i started my own niche website making iphone app templates (easily googleable). I ended up taking it to roughly $3k/month in revenue and have just sold it to a private company.

Thank you for writing that post.


Nice site. Has the income come down due to a reduction in traffic spend or just a loss in rankings due to reduction in freshness metric wrt SEO or any other reason?


My site got slapped by Google Penguin update, lost 90% of its traffic and never really recovered. It's going down steadily now for some time.

As for the Google penguin update drop in rankings, it might have been a stale content penalty, or a devaluation of spammy links - I wrote manually lots of articles for supposedly respectable article directories pointing back to the template website to go up in search engine rankings and it worked well for some time.

The idea was to extract myself of this process at some point since it was painful to write not very interesting articles. But didn't get around doing it, or outsourcing it.


My site got slapped by Google Penguin update, lost 90% of its traffic and never really recovered.

It's funny how you don't really build websites anymore (did we ever?), you build sites for Google's search engine.

Even thought websites are conceptually different from writing a Photoshop plugin, in reality? Not so much. You're just as dependent on Google as you are Adobe, it's just hidden.


Would you consider passing it on to someone else, with a view to getting hands off royalties for a time. Or would you just want to sell it and have it clear cut?


He mentioned it's probably seasonal. All the traffic he gets during non-events are people who have friends with a birthday soon.


Bit late to the boat but:

Around $700/mo from a themeforest account.

And the more interesting story, about £4.5k/mo from a cleaning business that i bought.

I will at some point write the story up, but the TL:DR is: Spotted vastly under valued cleaning business with complete staff. Turnover of previous owner £190k a year. Profit of previous owner £18k. Yup, £18k.... Bought it for £13.5k.

Still in the early stages and still changing things but the previous owner was/is in massive debt, little free time to put into the business, did EVERYTHING on paper/fax/phone and had enormous monthly costs.

Theres a much longer story to this but i'll write it up in a few months when its a bit more proven.


Would love to read the story. Buying and modernizing traditional businesses (cleaners, laundromats, etc) is something that I think is really interesting.


Hey all, i realise i'm much too late to this but if anyone checks, i setup a mailchimp list i'll blast out when i make a proper write up of my story: http://eepurl.com/FNvPr


I'd love to hear more about it when/if you get around to writing it up!


Also very interested in this story... Where would you put it up once you write it? (So I can start monitoring...)


Any tips on finding undervalued small businesses? How did you come across this one?


A day late and I'm not the OP, but a friend of mine did this by talking to a business broker. He found a small technology business that was operated by an old couple that needed to quit.

The couple had been making sensors for a niche industry forever and were still charging prices from 10 years earlier. His first order of business was to contact all the customers and tell them prices were going up.


Cleaning. Like house cleaning, dry cleaning? I'm intrigued.


House cleaning primarily, yup. 104 clients, 10 of them are offices, 9 cleaners.


It might sound kind of obscene here on HN, but I'm making about 3500 euros per month, semi-passive from adult related site/community. It's subscription based and the content is user submitted (that's why it's semi-passive). Some moderation is necessary, as well basic user support, but overall - not so much hustle.


How did you break into this industry? I've done random work as a freelancer for a few different adults sites, but I've always felt like running my own was the real "money shot" as far as passive income goes. Can you elaborate on how you got started and how you keep an edge in such a competitive space?


I'm not really into the industry - my main income is coming from working for major brands in the ("mainstream") ad industry.

I saw the service of acquaintance of mine and what revenue he's making, so I though I can do better.

Generally, in this industry there's massive shortage of talent, ideas and innovation. This is a big opportunity for people who are delivering value in the "mainstream" startup scene and that was one of the reasons which made me try - you can get in and disrupt pretty easily if you think out of the box, which is not so hard in this context.

Most of the stuff is almost scam, the customers are threatened like idiots and technologically the year is 2002-2003.

There are people who say there's no money anymore in this industry and they're right - there's no money for people who are short on skills, ideas and execution, but there is huge potential for people who are coming from other "mainstream" industries.

My prediction is that lot of talented kids will enter this industry with great services - I see it as emerging trend at the moment.


Is technology really that behind? I mean redtube/et al are some of the largest websites out there and the blog posts seem to show a pretty high level of technology behind them although with a larger focus on cost than most startups.


99% of adult sites run on single servers using out of date PHP/MySQL scripts. Sites like RedTube, etc use newer technology, like at Confoo a dev for YouPorn talked about their stack and they use Symfony, Varnish and Nginx.


True, but behind these tube sites stays [1] Fabian Thylmann and his [2] company. He is considered as the biggest disruptor who revolutionised the business. The whole story is something like Napster and the record labels, but slightly different.

[1] http://en.wikipedia.org/wiki/Fabian_Thylmann

[2] http://en.wikipedia.org/wiki/Manwin


Do you work with Manwin at all?


No - I don't have any points of contact with Manwin.


Can you please provide more detail regarding how innovation is lacking?


I've been curious because I was thinking of doing something that would host content; is it a legal nightmare if someone uploads illegal material? Is it common?


It depends, but overall it might be risky if you don't pay the necessary attention.

In my case - I've kind of outsourced it, but every user submission is being reviewed before it's published.


Yes, and yes.


Care to elaborate? How much risk is there to the site owner which accidentally hosts the content?


You'll want to make sure all models are of legal age, and that the person submitting it has the rights to upload the material. Yes there's DMCA clauses to live behind that help make such tasks easier but in adult DMCA is so widely abused that it's best to make sure your stuff is 100% legal and legit to stay out of trouble. Not worth the returns in my opinion.

Source: I have just spent the last 12 years in adult and recently just severed all ties with the imploding industry.


It's not obscene to work in the adult industry! Good for you for being successful at what you do. €3,500/month isn't something to sneeze at.


Which payment provider are you using? AFAIK most of them are very picky on the subject.


CCBill, SegPay and Achbill.


Most adult sites use CCBill.


Monexa.


Congrats. What hosts are you running at? I haven't been able to find one that allows adult content


Thank you.

I'm using Webair at the moment, but you can check also Amerinoc and Leaseweb.


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