Dropping my MRR obsession

Not sure who needs to hear this but… MRR is not everything.

Because $1 earned is $1 is $1, whether MRR or 1-off revenue.

I drank too much of the SaaS startup koolaid and put MRR on a high moral pedestal.

Letting that go was a huge relief.

There I said it.

OK some context: I’ve been an entrepreneur for the past 7 years. My main income comes via consulting, but I wanted to transit to SaaS, because of the scalability of it. It also disconnects time from money, which is what I’m after.

But in my eagerness to switch lanes, I obsessed over MRR and got unhappy. I started seeing the other products in my portfolio and all other types of revenue as ‘lower’ life forms. Without MRR, my startup always felt less legit, like a second class citizen. An elitist perspective.

But now I realised, consulting revenue is money too.

It’s humble, hard work. Yes it’s time-based, but it had supported me and my family with a good life for the past 7 years. Should I really be so ungrateful for that?

Truth is, I can mix them as a portfolio and I can be happy. All along I’ve had the portfolio of businesses. Nothing had changed, only my perspective. I can continue to run them as a portfolio, have diversification against risk, and have a good life.

Chasing stability

Discussing this topic on Twitter also made me realised that perhaps MRR was attractive because of the perceived stability.

Almost all my adult life I had a job. It had stable salary. I quit and go run my own business, and thought I’ll be comfortable with the uncertainty of a variable income. Maybe not.

I admit: Stability was one of my considerations when chasing MRR. It was like a replacement for my salary!

But does it have to be MRR to have that element of recurrence?

Is it possible to have repeatable sales for a 1-off payment kind of product? Feels possible and that’s kind of recurring too, isn’t it? A Twitter friend @therealjayber, founder of the Twitter scheduling tool I’m using now Zlappo, shared an insightful observation:

“There are plenty of entrepreneurs making a living/killing out of 1-off products. Buyers purchase more impulsively with 1-off products, as it’s once and done. I’d even say that $10 of 1-off revenue is easier to make than $1 of MRR. Would be irrational to ignore that revenue.”

That true! My $15 digital download gets way more sales month on month than my $10/m SaaS! I also wonder if subscription fatigue might also tilt the favour towards 1-off buys.

Like they say: “A bird in hand is worth two in the bush.” Give me $12 upfront, rather the promise of $1 every month for 1 year.

So perhaps, I don’t need MRR as a creator. I can just make useful, valuable things people need and will buy, and earn a monthly variable income from that.

It can work. It will work.