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How to Find New Revenue Streams for Your Startup

9 min read

Starting a startup is hard work. There are so many things to think about, and it can be challenging to know where to start.

With so many things to do, it’s easy to forget about one of the most important aspects of running a successful startup: generating revenue.

Revenue is what keeps your startup afloat and helps you grow. Without it, your startup will quickly sink. That’s why it’s crucial to have a few different revenue streams.

With that in mind, in this article, we will show you the process to consider when finding new revenue streams for your startup. These revenue streams can help your startup grow and thrive sooner rather than later.

Let’s get right into it.

Steps To Identifying New Revenue Streams

The following steps will help you identify new revenue streams for your startup.

 1. Know Your Audience

While you might not yet have customers, it’s important to know who your target market is. This will help you better understand what they want and need. It’s also important to segment your future customers. This will allow you to better target them with specific products or services that they’re more likely to be interested in.

Talking to your target market is a great way to learn more about them.

If you want to understand the pain points that they’re experiencing, there are various ways to gather this information.

This includes:

  • Surveys
  • Customer interviews
  • User testing
  • Focus groups

Knowing your potential customers can sometimes open up revenue streams that you never even considered before. By understanding their needs, you can develop new products or services that fill those needs and generate revenue for your startup.

 2. Do Your Research

In addition to talking to your target audience, it’s also essential to do your research. This means keeping up with the latest trends in your industry and knowing what’s happening in the broader market. You can’t be an expert on everything, but knowing what’s going on will help you identify potential revenue streams for your startup.

Some of the best ways to stay informed include:

  • Reading industry news and blogs: This will help you stay on top of your field’s latest trends and developments.
  • Following thought leaders on social media: This will give you insights into what’s happening in the broader market and new ideas that you can apply to your business.
  • Attending industry events: This is a great way to network and learn from other businesses in your field.
  • Talking to others in the startup state: You can learn a lot from other founders, so don’t be afraid to reach out and connect with them.

By doing your research, you’ll be able to identify potential revenue streams that you might have otherwise missed.

3. Be Open To New Ideas

When thinking about revenue streams, one of the best growth strategies is to be open to new ideas. Don’t get too caught up in what’s worked in the past or what’s traditional. Instead, think outside the box and explore new and innovative ways to generate revenue.

The great thing about startups is the flexibility to try new things. So don’t be afraid to experiment and see what works. The worst that can happen is that it doesn’t work out, but you’ll never know unless you try.

New ideas might come in all shapes and forms, so be on the lookout for them. They could include some of the following concepts.

A New Pricing Model

While traditionally, things were valued at a certain dollar amount, don’t be afraid to experiment with new pricing models. With the advent of new technology, there are now more options than ever before. Explore different pricing models and see what works best for your business.

A New Product Or Service

In addition to new pricing models, you might also want to consider offering new products or services. This could be completely new or something that’s a slight variation of an existing product or service.

Partnering With Another Business

Another option is to partner with another business. This could take many different forms, but the basic idea is to team up with another company to generate revenue.

For example, you could partner with a complementary business to cross-promote each other’s products or services or you could partner with a larger company to get access to their customer base while providing something of value in return.

New Ways To Market Your Products Or Services

Finally, you might consider finding new ways to sell your products or services. This could involve anything from traditional marketing techniques to more innovative methods.

Examples of traditional marketing techniques include print ads, TV commercials, and radio ads. Meanwhile, some more innovative marketing methods models include content marketing, social media marketing, and email marketing.

Mixing up various methods can also be a new thing in your industry that could take your market by storm.

 4. Test And Iterate

Once you’ve identified some potential revenue streams, it’s time to test them out. This means launching small pilot programs or experiments to see how they perform.

Don’t put all your eggs in one basket, though. Instead, test out a few different revenue streams and see which ones have the most potential. Then, you can focus on developing those further.

The same applies to the tech tools startups typically use in their business. While some might be essential, others might only be needed on a trial basis. The key is to figure out what works best for your business through testing and iteration – and then sticking with it.

5. Launch And Promote

If your tests are successful, it’s time to dive deeper into your new revenue streams and promote the products associated with them. This is where marketing comes in. You’ll need to let people know about your latest offerings and what problems you’ll be solving.

No matter which channels you use, the goal is to get the word out about the value you provide and really make the most of your new revenue streams while generating interest (and income) from potential customers.

6. Evaluate And Adjust

Finally, it’s essential to evaluate your new revenue streams and make adjustments based on the results you get. This means tracking your metrics and seeing how well each revenue stream is performing.

If one of your revenue streams isn’t performing as well as you’d like, don’t be afraid to make changes. This could involve anything from tweaking your pricing to changing your marketing strategy associated with that revenue stream.

The most important thing is to continually evaluate your performance and make adjustments as necessary. This way, you can maximize your revenue and keep your business growing.

Successful Startups That Changed Traditional Business Models

While it’s essential to find new revenue streams, it’s also worth looking at some companies that have successfully changed traditional business models. This can give you some ideas of what’s possible and might even inspire you to apply some of these concepts to your own business.

1. Airbnb

Airbnb is a company that allows people to rent out their homes or apartments to travelers. This is an excellent example of finding a new revenue stream by offering a new product or service.

As a startup, Airbnb challenged the traditional hotel industry by offering a unique and innovative alternative. As a result of this, it’s one of the most successful companies globally.

2. Uber

Uber is a company that allows people to hail rides from their smartphones. This is another example of finding a new revenue stream by offering a better service than what was available.

When Uber first launched, it disrupted the traditional taxi industry by offering a more convenient and affordable option. Today, it’s one of the most popular transportation companies around.

3. Dollar Shave Club

Dollar Shave Club is a company that delivers razor blades to one’s door each month. In a market where razor blades were traditionally sold in stores, Dollar Shave Club found a new way to reach customers and make money.

Now it has multiple revenue streams that include product sales, subscriptions, and even advertising. Plus, it’s one of the most popular shaving brands in the world.

4. Amazon

Amazon is a company that sells books, electronics, and many other items online. This is an example of finding a new revenue stream by expanding into a new market.

When Amazon first started, it was just an online bookstore. But soon, it began selling a wider variety of items, and eventually, it became the eCommerce giant it is today.

It even kept innovating with Amazon Prime, giving customers free shipping and faster deliveries on millions of items.

5. Spotify

Spotify is a music streaming service that offers ad-supported and subscription-based plans. This is an example of finding a new revenue stream by pricing your product or service differently.

People were used to buying music outright or listening to it for free with ads. Spotify found a way to give people ad-free music for a monthly fee, and it’s now one of the most popular streaming services around.

Pitfalls To Avoid When Finding New Revenue Streams

Startups that do not innovate and instead keep the same business model that has always been used are destined to fail.

With that said, finding new revenue streams is not always easy. It requires a lot of hard work, creativity, and dedication.

The following are some of the biggest pitfalls that startups face when trying to find new revenue streams.

Unwilling To Change

One of the biggest reasons startups find it hard to explore new revenue streams is that change is hard. It’s difficult to break out of the mold and try something new.

But if you want your startup to be successful, you have to be willing to take risks and make changes. This means being open to new ideas and trying things outside of your comfort zone.

Loss Of Control

Another big reason startups don’t find new revenue streams is that they’re afraid of losing control. When you try something new, there’s always a chance that it won’t work out the way you planned.

And while this is true, it’s important to remember that you can constantly adjust your course if things aren’t going the way you want. The important thing is to take that first step and see what happens.

Lack Of Trust

A lack of trust can also keep startups from finding new revenue streams. When you’re working on something new, it’s essential to have faith in your team and their ability to execute your vision.

If you don’t trust the people you’re working with, it will be tough to make progress.

Conversely, building a solid team that trusts each other is one of the essential pieces of advice to follow when growing your own business.

Lack Of Resources

Another big obstacle that startups face is a lack of resources. It can be challenging to find the money and human resources necessary to try something new when you’re just starting.

But even if you don’t have a lot of resources, there are still ways to get started. You can also start small and gradually scale up as you get more funding.

Too Many Processes

Another thing that can hold startups back is having too many processes. When trying to do something new, it’s essential to move quickly and not get bogged down in details.

If you spend too much time planning and not enough time executing, you’ll never make any progress.

What Startups Can Learn From The Successful Self-Employed

The self-employed are a class of workers who are not reliant on a single employer. They typically work for themselves and have multiple clients. While this can be a more unstable way to earn a living, it also has its advantages.

The best self-employed jobs have a few things in common:

  • They’re usually creative or knowledge-based jobs.
  • They often allow for a high degree of flexibility and autonomy.
  • They can be scaled up or down as needed, making them more resilient to economic fluctuations.
  • They typically don’t require a lot of costs to initially get going.

These factors can teach us a lot about what it takes to succeed as a startup when it comes to finding new sources of income.

Conclusion

In conclusion, finding new revenue streams for your startup is not easy. Amongst other qualities, it requires hard work, creativity, and dedication.

With that said, by taking the time to go through the process of finding new revenue streams, you can give your startup the best chance of success. And while it’s not easy, it’s certainly worth it – both in the short-term startup stage and long-term as a sustainable business.

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Author Bio

Hanson Cheng is the founder of Freedom to Ascend. He empowers online entrepreneurs and business owners to 10x their business and become financially independent. You can connect with him here.

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