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There are a lot of different business models that entrepreneurs can succeed in. However, recurring revenue business ideas are the best to start with.
Cash flow is the bloodline of any business out there, and just like humans who need consistent blood flow, a business needs its cash flow as well to keep the company running.
This is the main reason why a recurring revenue business is a great model for any company, as it will provide them with dependable revenue that can be used for the betterment of the business.
That’s why we compiled a comprehensive list of recurring revenue business ideas that you can start, but before that let’s discuss what is a recurring revenue business.
What is a Recurring Revenue Business?
A recurring revenue business is a business model that focuses on developing consistent and predictable cash flow from its current customers and increasing profit by adding more users. Most companies will set the payment for their products or services in monthly or yearly intervals, but can also be quarterly or usage-based.
With this business setup, you can easily build up the company’s revenue since you will have consistent profit coming in at your set interval, especially if you have a high customer retention rate.
Advantages of a Recurring Revenue Business Model
A recurring revenue business model has become one of the most popular strategies for companies to stabilize their business and more. Here are some of its notable advantages:
- Predictable Revenue: Companies can easily predict their next profit or revenue based on the amount of customers that they currently have.
- Easier to Scale: The revenue is directly proportional to the number of users of the product or service, which means that an increase in customers is an increase in profit.
- Better Customer Lifetime Value: Other business models only require their customers to pay once, but this business setup requires users to pay for as long as they use the product or service.
- Higher Business Valuation: When selling a business, a venture that has a recurring revenue is often evaluated higher because of its predictable cash flow and scalability.
- Less Marketing and Advertising Costs: This business model also has lower marketing costs because the priority is more on retaining the current customers rather than customer acquisition unless it is time to scale and grow the business.
Key Characteristics of Recurring Revenue Business Ideas: Criteria Table
This is a table of our criteria for selecting the best recurring revenue business ideas on this list. From having a predictable revenue to its ability to scale, each business idea must possess a few or all of the characteristics mentioned in the table.
| Characteristic | Description |
|---|---|
| 1. Predictable Revenue | A recurring revenue business idea must have a predictable monthly cash flow which is usually equivalent to product or service cost multiplied by the number of total customers. |
| 2. Automation and Efficiency | It has the potential to be automated and does not need human intervention 24/7. |
| 3. Customer Retention Rate | The ability to retain customers is as important if not more than attracting new ones. |
| 4. Low Operational Costs | The profit should be enough to justify the expenses of the business. |
| 5. Business Scalability | The business should be able to handle a huge surge of users and customer growth. |
| 6. Niche Market | It must cater to a specific group of audiences to serve their needs and solve their problems properly. |
33 Recurring Revenue Business Ideas
Here are the business ideas that follow a recurring revenue business model along with some real-life examples. It is separated based on the category that it is closely aligned with.
Streaming and Media Services
1. Video Streaming Services (e.g., Netflix)
You can launch a streaming service that focuses on catering to a selected group of people with specific interests. Similar to how Disney+ caters to their fans and followers. After gaining some traction and loyal customers, you can then expand to include multiple genres just like Netflix.
2. Music Streaming Platforms (e.g., Spotify)
Spotify and Apple Music dominate this space, but there is always room for an innovative and unique platform. You can try adding AI-generated audio, YouTube or TikTok sounds, and more. The key is to differentiate your product from the likes of the unicorn companies in your industry.
3. Podcast Subscription Services
Most podcasts are uploaded to YouTube and Spotify, and with the growing popularity of the industry, it might be worth it to try and compete with these companies and attract your own set of listeners and users.
You can also provide a way to categorize the podcasts based on their specific theme like educational content, entertainment, personal development, or whichever genres your audience will highly resonate with.
4. Forbes-Style Media Model
Just like Forbes, you can start to create an online platform that will publish content and be shared all over the internet. They are present in every social media app, and search engine, gaining millions of readers and audience monthly.
A great plan to succeed is similar to how they operate, when developing an article, make sure that it will be engaging and shareable. Also, be active on all the platforms that your target readers are present in.
5. Magazine Business Model
The magazine business model has been around for some time now, but it is still one of the best recurring revenue businesses out there. However, the main difference is now most of it is done online. The magazines are sent to the accounts of the subscribers or even to their emails.
Some of the best examples are Wired for tech-interested individuals, Vogue for fashion, and Entrepreneur for business-related magazines. You can also develop a magazine business model, but you have to find a gap in the market and a niche audience.
Mobile App Services
6. Fitness and Wellness Tracking Apps
Fitness and wellness are now one of the biggest priorities for individuals. More and more people are becoming obsessed with staying as fit as they can, and it is one of those healthy habits that everyone can take part in. You can take advantage of this opportunity by creating personalized fitness and wellness apps, like MyFitnessPal and Fitbit App.
7. Educational and Learning Apps
Ever since the pandemic, there has been a lot of focus on learning online and this gives entrepreneurs a big opportunity to start a business with. Just like Khan Academy, you can create an app that focuses on educating individuals on the specific subject they are interested in. Just make sure that you start with a few select topics before expanding to a broader educational
8. Meditation and Mindfulness Apps
With all the noise around us, it is important to stay mindful to be more productive and stay calm during daily life challenges. That’s why a meditation and mindfulness app like Headspace, will be a great idea for a recurring revenue business.
9. Personal Finance and Budgeting Apps
An app that helps users manage their finances through their phones is a good recurring revenue business model that is feasible. Most banks have mobile apps to help their customers with their debits and credits, however, there is a lack of apps for entrepreneurs that help them in budgeting, payment of bills, and monitoring of the business’ profit and expenses.
10. Gaming Apps with Subscription Models
Gaming apps will always be popular, however developing a successful one with millions of users rarely ever happens because of its competitive nature. The reason for that competition is the incredible rewards of success in this industry that will surely make your hard work and time worth it.
Some of the most notable gaming apps are Clash of Clans, which has earned upwards of 5 billion dollars over its lifespan, and Candy Crush Saga which has reached about 20 billion dollars in revenue.
11. Language Learning Apps
One of the most popular language-learning apps is Duolingo, however, it is still possible to create an alternative that can teach people the languages they want to speak in a better way. Duolingo is already beginner-friendly, but think about an app with an incorporated community of bilingual and multilingual people who all help each other learn.
12. Productivity and Organization Apps
Productivity is a trait that a lot of people struggle to have. It can be because of the distractions present in the modern world, or their own lack of focus and motivation. That’s why developing an app that caters to specific individuals who all have the same problem can be a great business idea.
13. Cooking and Recipe Apps
Cooking and recipes will always be a part of the online world because we all like to eat good food right? That key is how great those recipes are, are they delicious enough? Are they easy to make? If you compile a bunch of these recipes in an app, that teaches people how to cook their favorite dishes then you can build a recurring revenue business.
14. News and Magazine Apps
We have discussed the magazine business model earlier, but it can also be accomplished by developing a mobile app. Although it will be harder than creating a website or even a social media page and starting your business in that way, a mobile app can be more lucrative. Some examples are Fliboard and the Athletic.
15. Children’s Educational and Entertainment Apps
A few years ago children learned by going outside, playing, and attending classes. Nowadays, even before they start their primary education, most of them will be exposed to a variety of information both good and bad.
Instead of these kids just using TikTok and YouTube where they can see a lot of videos that will not be helpful for their development. Why not create a mobile app that will both be educational and entertaining, specifically for the children of the future?
Software as a Service (SaaS) Models
16. Cloud-Based Business Solutions
Another recurring revenue business idea is a cloud-based solution to companies’ problems and needs. Some examples could include storage of their critical data, tools for project management, and communication of the whole team.
Examples of cloud-based solutions are Microsoft Azure and Amazon Web Services or AWS. The key to a successful cloud-based business is to find a need or problem that no one has successfully solved or fulfilled. This way you can be sure that your solution will have a demand and recurring customers.
17. Customer Relationship Management (CRM) Systems
Customer relationship management or CRM systems help businesses manage their relationship with their customers and foster this connection. If your system can successfully automate the process of sales and marketing like HubSpot, you can create a recurring revenue business. With better or at least decent pricing, you can still get customers who will pay you monthly for such services.
18. Enterprise Resource Planning (ERP) Software
ERP software helps businesses streamline their processes inside the company. From the supply chain to their human resources all the way to the financials of the business, an ERP will be a beneficial tool that companies will be willing to pay for consistently as long as it perform its functions.
Online Learning Platforms
19. Interactive E-Learning Courses
A great example would be Coursera and Udemy, both of which aim to educate their users in whichever subject or topic they want to know more about. A successful course online can be sold over and over again, making it a great source of income for businesses and individuals.
20. Evergreen Educational Content
We have discussed educational content above, but that one focuses on creating a mobile app surrounding this concept. For this business idea, you can create evergreen educational content that will be used by generations down the road and share it on as many platforms as you want.
You can create a YouTube channel, a Website, a Facebook page, or all of it. If it is filled with evergreen content then it will always be relevant and profitable. The key is to reach as many people as you can, as well as create educational content on a regular basis to keep your customers engaged.
21. Virtual Tutoring and Coaching Services
You can create platforms that connect coaches and tutors with students and customers willing to pay monthly for a subscription to these services. This way you can create a recurring revenue business model that will be consistent, but this will all be dependent on the quality of tutors and coaches that you can attract to participate. Examples of similar services are Wyzant and VIPKid.
Exclusive Membership Services
22. Mastermind Group Memberships
Mastermind groups are a network of people that offer mentorships and support in your professional life and some even include personal development. It is often developed to be a recurring revenue business, as people pay especially entrepreneurs to network with individuals who have similar goals, passions, and dreams.
23. Business Network Membership Programs
Just like mastermind group memberships, a business network is a recurring revenue business model. However, it focuses more on the business aspect of the relationship rather than the personal part. A great example would be LinkedIn Premium which will offer users much more tools and insights into their professional resources.
24. Premium Content Membership Sites
If you have valuable information whether it is informational or entertaining, as long as people want to see it, read it, or listen to it, then you can start a membership site where your followers can access this premium content.
To succeed though, you have to give them a taste of how great the content is, and you have to regularly update and publish to not lose any customers.
Subscription Box Services
25. Beauty and Makeup Subscription Boxes
Start a subscription box revolving around beauty and makeup products. This can include popular items that the general public wants or personalized makeup necessities for users. One good example is IPSY, a company that focuses on monthly personalized makeup boxes.
26. Monthly Toy Subscription Services
Monthly toy subscription services do not necessarily mean it will only be for children, although that will mostly be the focus. You can also develop it for teenagers and even adults. For example, if someone is really interested in Marvel, Star Wars, or Cars, these toy subscriptions can both be catered to any age.
27. Gourmet Food and Beverage Boxes
Similar to how Uber Eats or DoorDash works, you can create a menu of gourmet and beverage box subscriptions and deliver it to your customers. This is ideally good for individuals who want to retain their diet and eating schedule. If someone eats the same combination of healthy food every week, then why not subscribe to a service that will make this diet easier to follow?
Affiliate Marketing
28. Product Affiliate Marketing Programs
This program refers to where businesses partner up with individuals, influencers, and other business owners to promote their products and services in exchange for a commission. If the product you are advertising is already a recurring revenue or subscription type, then your commission will also be recurring for as long as the referred customers stay.
This business idea is being used by the biggest brands, websites, and platforms in the world. For example, enter the keyword “Best VPN”, and you will see the search engine result page dominated by companies such as CNET, Forbes, and PC Magazine.
29. Service Referral Strategies
This is the same as the one above but with a more focus on service rather than products. A good example is Dropbox’s referral program where they provide users an extra storage for each user they bring in. The key to this business idea is the incentive to promote the service and its quality.
30. Digital Product Affiliate Systems
Affiliate marketing with a focus on digital products such as online courses, eBooks, and software is a good recurring revenue business idea that will surely be profitable. Since most digital product has lower startup costs, they also offer better commission rates. So, as long as you know how to successfully promote and market a product then it will be a great use of your time.
Community Support and Crowdfunding Platforms
31. Content Creator Support Platforms (e.g., Patreon)
Publishing content will always be a good idea in the modern world, as there are a lot of mediums that you can use to earn some cash. A great example is Patreon, which lets users subscribe to their favorite content creators to access exclusive content or unique experiences from the creator.
32. Crowdfunding Membership Models
Creating a crowdfunding membership model can be profitable for both the developer and the members. Users can sign up and pay a small monthly fee for a subscription, in exchange for access to a broader range of individuals who might be willing to invest more in the projects and ideas, similar to Kickstarter which aims to support startups in launching their businesses.
33. Fan Engagement Platforms
These platforms allow content creators to earn more, not just by publishing their content but by interacting with their followers, readers, and audience. It can feature live question-and-answer sessions, or behind-the-scenes videos and images. It is a good way to create a community around your brand or company.
Comparison of Recurring Revenue Business Models
This table compares the recurring revenue business model that was labeled as categories in this list where the 33 different business ideas were based. It showcases the market competition and potential for its profitability with exceptional as the highest, which can also mean above what you are expecting.
| Categories | Market Competition | Revenue Potential |
|---|---|---|
| 1. Streaming and Media Services | Exceptional | Exceptional |
| 2. Mobile App Services | High | Exceptional |
| 3. Software as a Service (SaaS) Models | Exceptional | Exceptional |
| 4. Online Learning Platforms | High | Moderate |
| 5. Exclusive Membership Services | Moderate to High | Moderate to High |
| 6. Subscription Box Services | Moderate | Moderate |
| 7. Affiliate Marketing | High | Moderate to High |
| 8. Crowdfunding Platforms | Moderate | Moderate to Exceptional |
As described in the table, the highest-earning models will also have the most intense competition. So, you should choose wisely as to which type of recurring revenue business idea will fit your vision.
Author's Final Thoughts
There are a lot of ways to earn online nowadays and it will only continue to rise, however, the best types are those that can give you and your company a consistent amount of profit. This will allow you to better plan for the future of the business, ensuring both growth and stability. But to be successful in this business model, you have to find the best idea that will fit your personality, brand, and goals.
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