2M users but no money in the bank • Hacker News Board

Re: 2M users but no money in the bank

#111

Post by mdgrech23 » Fri, Sep 06, 2024, 5:47 PM UTC

efitz wrote: post #110

From the article: > “I've lost faith in the nonprofit business model”. There’s your problem right there. Investors want profit. If you want investors then you have to convince them you’ll deliver ROI. Altruism is not a business model. There is nothing wrong with altruism but it is not compatible (except in short term or insignificant ways) with most of the business world, which is profit driven.

I think it's fair to say we need a new model, just saying but all of that is way bigger than me or you or Exercism.

Re: 2M users but no money in the bank

#112

Post by darth_avocado » Fri, Sep 06, 2024, 5:47 PM UTC

efitz wrote: post #110

From the article: > “I've lost faith in the nonprofit business model”. There’s your problem right there. Investors want profit. If you want investors then you have to convince them you’ll deliver ROI. Altruism is not a business model. There is nothing wrong with altruism but it is not compatible (except in short term or insignificant ways) with most of the business world, which is profit driven.

Non profit doesn't mean you survive on donations. Non profit can still charge money to keep the lights on. If you have 2M users, charging $0.50/year for use can still get you $1M to run your business.

Edit: I think the comment was taken quite literally. The point I was trying to make was that the user base exists, monetization for profit is definitely hard, but monetization for keeping the lights on can work. You could try a flat fee for all users, you could do seasonal exclusive contents to support the platform, you could try selling merch, you could literally put a banner annually like Wikipedia does etc. The point being, if you have 2M users and you provide enough value, there are ways to make it work. Donations unfortunately don’t work, because it’s not top of mind for people and people need a little pushing.

Re: 2M users but no money in the bank

#113

Post by chaos_emergent » Fri, Sep 06, 2024, 5:50 PM UTC

darth_avocado wrote: post #112

efitz wrote: post #110

From the article: > “I've lost faith in the nonprofit business model”. There’s your problem right there. Investors want profit. If you want investors then you have to convince them you’ll deliver ROI. Altruism is not a business model. There is nothing wrong with altruism but it is not compatible (except in short term or insignificant ways) with most of the business world, which is profit driven.

Non profit doesn't mean you survive on donations. Non profit can still charge money to keep the lights on. If you have 2M users, charging $0.50/year for use can still get you $1M to run your business. Edit: I think the comment was taken quite literally. The point I was trying to make was that the user base exists, monetization for profit is definitely hard, but monetization for keeping the lights on can work. You cou…

this isn't at all realistic; a tiny fraction of free users are going to be willing to pay for your product.

Re: 2M users but no money in the bank

#114

Post by bee_rider » Fri, Sep 06, 2024, 5:54 PM UTC

bux93 wrote: post #12

What does "I've lost faith in the nonprofit business model" mean? Non-profits have costs they pay. Many famously outlive their founders. Many, like co-ops or credit unions, don't depend on donations/endowments. They have revenue greater than expenses as a matter of basic accounting?

He wrote:

“I think it's fair to say that at this stage I've lost faith in the nonprofit business model working in a way that allows Exercism to reach any of its potential.”

Which provides additional context. Why’d you remove it? It makes it clear that he’s talking about the non-profit business model as applied to his company.

Re: 2M users but no money in the bank

#115

Post by mrmuagi » Fri, Sep 06, 2024, 5:56 PM UTC

darth_avocado wrote: post #112

efitz wrote: post #110

From the article: > “I've lost faith in the nonprofit business model”. There’s your problem right there. Investors want profit. If you want investors then you have to convince them you’ll deliver ROI. Altruism is not a business model. There is nothing wrong with altruism but it is not compatible (except in short term or insignificant ways) with most of the business world, which is profit driven.

Non profit doesn't mean you survive on donations. Non profit can still charge money to keep the lights on. If you have 2M users, charging $0.50/year for use can still get you $1M to run your business. Edit: I think the comment was taken quite literally. The point I was trying to make was that the user base exists, monetization for profit is definitely hard, but monetization for keeping the lights on can work. You cou…

As a side point I was curious how low you can charge given processing fees, and you'll have to charge $1 to get $0.50 cents roughly (checked Stripe/Paypal for my currency CAD).

Re: 2M users but no money in the bank

#116

Post by bee_rider » Fri, Sep 06, 2024, 5:58 PM UTC

efitz wrote: post #110

From the article: > “I've lost faith in the nonprofit business model”. There’s your problem right there. Investors want profit. If you want investors then you have to convince them you’ll deliver ROI. Altruism is not a business model. There is nothing wrong with altruism but it is not compatible (except in short term or insignificant ways) with most of the business world, which is profit driven.

He wrote:

“I think it's fair to say that at this stage I've lost faith in the nonprofit business model working in a way that allows Exercism to reach any of its potential.”

Removing the context that makes it clear that a quote is only applying to a very limited situation is a bit dishonest.

Re: 2M users but no money in the bank

#117

Post by insane_dreamer » Fri, Sep 06, 2024, 6:00 PM UTC

Congratulations on a very successful platform! (Success should be measured in usage/reach, not $).

You've probably thought of this, but it might be easier to charge a very small amount -- say $1/month, which most people even students, could afford, rather than rely on donations. If you get 1% of users paying that, it's still $20K month which is more than you're getting now. (Of course managing the payments themselves costs money).

It can still be non-profit (which is a great thing), so no one is getting rich off of it, and it doesn't poison the mission. But it could pay the bills.

Update: Processing fees are a problem as posters have pointed out, so you'd probably want to make it $10/year, or $5/six months. It's still an easily decision for a very large number of people.

Patreon has $1/month options, not sure how they do it though.

Re: 2M users but no money in the bank

#118

Post by ocean_moist » Fri, Sep 06, 2024, 6:00 PM UTC

The only way out for something like this to stay afloat is to be subsidized by a big tech company.

$7,500 monthly is nothing to a large tech company. It sort of does makes sense for big companies to subsidize this so that the quality and amount of software engineers that join their company increases.

This value prop is intangible, but I feel like at least one big company would go for it.

Re: 2M users but no money in the bank

#119

Post by jfdjkfdhjds » Fri, Sep 06, 2024, 6:04 PM UTC

fendy3002 wrote: post #48

Laaas wrote: post #22

Earlier quoted context omitted.

You’d think they’d use a cheaper hosting service if that’s literally the only thing preventing them from having positive gross profit.

honest questions, is there any ECS-like hosting that's much cheaper?

for compute of containerized payloads, in house servers is a no brainer for cost.

almos zero sysadmin troubles. might even reduce the troubles of working with eks/ecs.

now for storage and db, that's a different story.

Re: 2M users but no money in the bank

#120

Post by [deleted] » Fri, Sep 06, 2024, 6:05 PM UTC

vidyesh wrote: post #66

mef wrote: post #9

out of money, final payroll, no alternative but to go into zombie mode, yet for the last few months the co-founder has been working on his next product which will launch in 2025. maybe everything that could have been tried was tried but this comes off like some of the effort spent working on the next company could have been spent keeping this one alive

They said they will be using the proceeds from that for-profile company to pay for a team member's salary and keep Exercism running as much as they can. So this next company could be considered to be an effort to keep this old one alive!

[deleted]