At 555 Ventures, we believe in transparency. By sharing our decision-making process, we aim to build trust and provide insights into how we approach new projects. This openness serves both our internal needs and offers a learning opportunity for others.
Criteria for Starting a New Project:
1. Focus on B2B Market
Our primary focus is on the B2B market, specifically targeting industries such as healthcare, hospitality, agriculture, and finance. For example, we have successfully developed a SaaS solution for ordering and inventory management tailored for small to mid-sized restaurant franchises.
2. Launch Customers
Identifying and selecting launch customers involves rigorous interviews and comprehensive market research. We use templates from the book Deploy Empathy by Michele Hansen to conduct these interviews. Our launch customers are typically innovative, leading companies within their industries, which helps us ensure relevance and impact.
3. Pricing Strategy
Determining the appropriate pricing for new projects, especially in subscription-based models, is an ongoing focus for us. Our initial goal is to achieve a minimum of $10,000 in monthly recurring revenue within the first 12 months. To reach this target and continue expanding, we will optimize pricing, introduce new features, and publish valuable content to attract and retain customers.
4. MVP Release
To ensure that our Minimum Viable Product (MVP) is billable, we focus on solving problems that enable users to save time, reduce costs, or increase earnings—essentially, creating tangible value for our customers.
5. Market Approach
We start with a one-sided market, where 555 Ventures directly provides services to potential users. Key indicators for expanding to a two-sided market include generating stable income from the one-sided solution. Once this stability is achieved, we can consider expanding our services to a two-sided market.
6. Leveraging Existing Platforms
Deciding between building a solution from scratch or developing a plugin or add-on for existing platforms depends on user needs. If users are already using an existing platform, or if solutions can be efficiently delivered through such platforms, we prefer to go for plugins or add-ons.
7. Subscription-Based Services
Focusing on subscription-based services provides us with a stable revenue sport and the opportunity to continuously improve our products. To ensure steady revenue, we aim to lower churn rates and acquire new customers consistently.
8. Targeting Niche Markets
Identifying niche markets with low competition involves creating specific rules, which we are currently developing. Our strategy to dominate these niche markets is to create products that are irresistible to our target audience.
By adhering to these criteria, 555 Ventures ensures our projects are viable and positioned for success. We hope that sharing our decision-making floor provides valuable insights and inspires other businesses to adopt a similarly transparent approach.