To build a successful and enduring company, you need more than just hype, publicity, or impressive fundraising skills.
Ultimately it all boils down to one simple principle: you must have a product that solves a pressing problem, and then the right amount of paying customers to make the math work.
Today’s infographic comes to us from Point Nine Capital, and it highlights five basic revenue models that startups can use to achieve $100 million in annual revenue.
The take home message here is that to build a long-term business, a team must implement a realistic strategy that considers multiple factors including product-market fit, user acquisition, pricing, and revenue per user.
Are you hunting flies, or are you trying to hunt elephants?
Just like in real life, these things require very different strategies and tactics. To build a $100 million revenue per year company, you’ll need to have a clear vision of your product-market fit and the customers you’re going after.
While the hunting analogy may be an oversimplification, it does help illustrate an undeniable truth to building large companies: how many users you will need depends on how much revenue you can earn per user.
This has implications.
If you are going to get $10 in annual ad revenue for each user, then you need a lot of users. If you’re going after Fortune 500 companies, you’ll need far fewer customers, but also a sophisticated and detailed sales strategy.
Flies – $10 per user x 10 million customers = $100 million in annual revenue
It takes a lot of flies to add up.
To build a big business with flies, you’ll need a product with a high viral coefficient (Instagram, WhatsApp, etc.) that spreads your brand quickly and inexpensively. Alternatively, you can build a platform that allows for the creation of massive amounts of user generated content (UGC) such as Yelp or Reddit.
Mice – $100 per user x 1 million customers = $100 million in annual revenue
Mice are still pretty small, but the expectations are higher than for flies. To get $100 per user, these customers will have to be directly paying for something, like a $10 monthly subscription. Music-streaming company Spotify is a good example of a startup hunting for mice.
Rabbits – $1k per user x 100k customers = $100 million in annual revenue
Once you hit rabbit territory, we are basically out of reach of B2C customers. That means to get 100k customers, they will likely have to be small businesses.
To do this, you’ll need a fantastic product, excellent inbound marketing, and an extremely high NPS (Net Promoter Score). The latter metric is used to measure the likelihood a customer would recommend you to their peers.
Deer – $10k per user x 10k customers = $100 million in annual revenue
We’re now getting up there in size – which makes it likely that deer have to be medium-sized businesses. These customers can afford to spend $10,000 per year, but expect a significant return on their investment.
While revenue per user is much higher than preceding levels, it is still not likely enough to warrant traditional enterprise field sales.
Elephants – $100k per user x 1k customers = $100 million in annual revenue
Going after elephants is a totally different world, and requires a skilled sales force, patience, and an enterprise-focused approach. You’ll need to educate Fortune 500 companies on why they should spend $100,000 with you each year – and you’ll need to be able to back that all up with a killer product.
Software as a Service (SaaS) companies like Workday or Salesforce often use this kind of strategy, and it allows them to key in on the features that their most important clients want to see. As we noted in a previous infographic, investors love the predictable revenue stemming from a well-positioned SaaS company.
The World’s Tech Giants, Ranked by Brand Value
Tech giants and e-commerce brands are thriving—and running circles around less pandemic-proof brands.
The World’s Tech Giants, Ranked by Brand Value
The pandemic has businesses everywhere on the ropes, with many firms filing for bankruptcy since lockdowns began. Despite the uncertainty, tech giants and major digital retail brands are still thriving—and some are running circles around those that are less pandemic-proof.
Using data from Kantar and Bloomberg, a recent brand report released by BrandZ shows which tech companies are proving their worth to consumers during COVID-19 chaos. With data covering almost 4 million consumers, BrandZ also reveals that the tech sector leads the world’s 100 most valued brands in terms of financial power and consumer sentiment.
Here’s how the top 20 tech brands from the report stack up:
|Rank||Company||Brand Value (2020)||Change (%)|
|#1||🇺🇸 Apple||$352 billion||+14%|
|#2||🇺🇸 Microsoft||$327 billion||+30%|
|#4||🇨🇳 Tencent||$151 billion||+15%|
|#6||🇺🇸 IBM||$84 billion||-3%|
|#7||🇩🇪 SAP||$58 billion||0%|
|#9||🇺🇸 Accenture||$41 billion||+6%|
|#10||🇺🇸 Intel||$37 billion||+17%|
|#11||🇺🇸 Adobe||$36 billion||+29%|
|#12||🇰🇷 Samsung||$33 billion||+7%|
|#13||🇺🇸 Salesforce||$30 billion||+13%|
|#15||🇨🇳 Huawei||$29 billion||+9%|
|#16||🇺🇸 Oracle||$27 billion||+2%|
|#17||🇺🇸 Cisco||$26 billion||-9%|
|#18||🇺🇸 Dell||$18 billion||-2%|
|#19||🇨🇳 Xiaomi||$17 billion||-16%|
|#20||🇨🇳 Baidu||$15 billion||-29%|
Out of the top five tech brands, Microsoft made the biggest moves with 30% brand value growth. Other big movers in the top 20 were Instagram (owned by Facebook), Adobe, and LinkedIn (owned by Microsoft), rising 47%, 29%, and 31%, respectively.
Broken down by nation, U.S. brands are dominating tech’s heavy hitters, claiming 14 of the world’s top 20 tech brands. Chinese brands round out much of the remaining top 20, including tech entertainment and social media giant Tencent, which rose 15% in brand value since 2019.
Big Tech’s Heavyweights
Tech’s top brands are raking in billions of dollars, capturing consumer mindshare, captivating people, and comforting them during volatile months. Apple, Microsoft, Google, Tencent, and Facebook—tech’s leading contingent—have made those moves look easy during what are rough times for many world brands.
While most tech brands in the upper half of the top 20 saw significant increases in brand value, only Facebook and IBM were in decline from 2019, at -7% and -3% respectively. The biggest loss in tech’s top 20 came from China’s Baidu, which fell by -29% in 2020.
Waning consumer trust, thanks in part to the perceived misuse of personal data, is a gap that tech’s popularity alone won’t fill forever. (Following the Cambridge Analytica scandal, nearly 25% of Facebook account holders reported being “extremely” or “very” concerned about their personal data.)
Coming in at eighth place, Facebook-owned Instagram gained 47% in brand value—a huge percentage, but less than the whopping 95% growth it had in 2019.
On the whole, digital apps have been faring well during the pandemic, especially those built for entertainment, shopping, social connection, and delivery.
These brands had anticipated, even invented, the online-offline dynamics of modern life that became indispensable for survival during the lockdown homebound weeks of avoiding the contagion.
— BrandZ 2020 Global Top 100 Report
Top Brands, by Category
While the brand value growth rates of tech giants aren’t entirely immune to the effects of COVID-19, the likes of Apple, Microsoft, and Google are growing steadily, surpassed only by e-commerce leader Amazon.
With data collected into April 2020, BrandZ’s report on the world’s top 100 brands reflects multiple shifting needs and consumer concerns at a categorical scale.
While consumer affinity for e-commerce and social media brands has increased, fast food and beer brands took a hit, despite reports of increased alcohol consumption and food delivery during lockdown. It would seem then, that consumers have been valuing their tools and means of consumption.
Of the report’s 14 brand categories, only six increased in value, mostly by less than 5%. Of the top risers, six were tech brands and six were mainly e-commerce.
Other upwardly mobile brands were those in the apparel and personal care categories. Much like retail, those categories had an increasing reliance on technology to deliver their products.
The above chart shows overall categorical changes for 2020 led by retail, tech, and insurance. In the opposite corner, energy, and bank brands took the biggest hits.
Rolling with the Punches
The economic impacts of COVID-19 are undeniable. Even still, BrandZ’s top 100 brands marked a steady increase of 6% in value in 2020, compared to 7% the previous year.
This pandemic has offered up era-defining change, with tech and e-commerce seizing the day. But in a climate where nothing can be taken for granted, brands large and small are still taking their knocks.
For now, the brands that are embraced by consumers will be those that can apply a salve to the blows that 2020 keeps delivering.
Connected Workers: How Digital Transformation is Shaping Industry’s Future
This graphic explores the role connected workers play in achieving successful digital transformation and identifying new growth opportnities.
Connected Workers: Shaping the Future of Industry
Digital transformation has upended businesses on a global scale, and no industry is immune from its powerful effects.
New technologies and enhancing customer experience are key drivers for companies investing in digital transformation, but the most important reason for prioritizing this shift is that it will allow them to leverage entirely new opportunities for growth.
However, with the speed of digital transformation accelerating at a furious pace, companies need to quickly adapt their working environment to keep up. This graphic from mCloud unearths the origins of the connected worker, and explores the potential applications of connected devices across industries.
The Rise of the Connected Worker
The mass adoption of smart devices has sparked a new wave of remote work. This type of working arrangement is estimated to inject $441 billion into the global economy every year, and save 2.5 million metric tonnes of CO2 by 2029—the equivalent of 1,280 flights between New York and London.
However, flexible or remote working looks different depending on the industry. For example, in the context of business services such as engineering or manufacturing, employees who carry out different tasks remotely using digital technologies are known as connected workers.
The term is not a one-size-fits-all, as there are many different types of connected workers with different roles, such as operators, field workers, engineers, and even executives. But regardless of an individual’s title, every connected worker plays a crucial role in achieving digital transformation.
Real Time Data, Real Time Benefits
When workers are connected to assets in real time, they can make better, more informed decisions—ultimately becoming a more efficient workforce overall. As a result, industries could unlock a wealth of benefits, such as:
- Reducing human error
- Increasing productivity
- Reducing dangerous incidents
- Saving time and money
- Monitoring assets 24/7
While connected workers can enhance the potential of industries, the tools they use to achieve these benefits are crucial to their success.
Connected Worker Technologies
A connected device has the ability to connect with other devices and systems through the internet. The connected worker device market is set for rapid growth over the next two decades, reaching $4.3 billion by 2039. Industries such as oil and gas, chemical production, and construction lead the way in the adoption of connected worker technologies, which include:
- Platforms: Hardware or software that uses artificial intelligence and data to allow engineers to create bespoke applications and control manufacturing processes remotely.
- Interfaces: Technologies such as 3D digital twins enable peer-to-peer information sharing. They also create an immersive reflection of surroundings that would have otherwise been inaccessible by workers, such as wind turbine blades.
- Smart sensors and IoT devices: Sensors that monitor assets provide a more holistic overview of industrial processes in real time and prevent dangerous incidents.
- Cloud and edge computing: Using the cloud allows workers to communicate with each other and manage shared data more efficiently.
Over time, connected devices are getting smarter and expanding their capabilities. Moreover, devices such as wearables are becoming more discreet than ever, and can even be embedded into personal protective equipment to gather data while remaining unobtrusive.
Real World Applications
With seemingly endless potential, these devices have the ability to provide game changing solutions to ongoing challenges across dozens of industries.
- Building Maintenance and Management
Facility managers can access real time information and connect with maintenance workers on site to resolve issues quickly. Building personnel can also access documentation and remote help through connected technologies.
- Task Management
Operators in industrial settings such as mining can control activities in remote locations. They can also enable field personnel to connect with experts in other locations.
- Communications Platform
Cloud-based communication platforms can provide healthcare practitioners with a tool to connect with the patient, the patient’s family and emergency care personnel.
By harnessing the power of artificial intelligence, the Internet of Things, and analytics, connected workers can continue to revolutionize businesses and industries across the globe.
Towards a More Connected Future
As companies navigate the challenges of COVID-19, implementing connected worker technologies and creating a data-driven work environment may quickly become an increasingly important priority.
Not only is digital transformation important for leveraging new growth opportunities to scale, it may be crucial for determining the future of certain businesses and industries.
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