Many companies considered successful today do not own an inventory or make actual products. They provide a needed service or connect people to things (or other people) which benefit them.
With the seemingly never-ending growth of the internet and social media, it’s never been easier to start a company with little or no startup capital, giving rise to thousands upon thousands of online companies who never have to make anything.
DVD video rental and streaming giant Netflix brought in a revenue of $3.61 billion in 2012, making $6 million in profits. Founded in 1997 by Marc Randolph, the company relies solely on distribution deals with manufacturers (e.g., Nintendo and Vizio) and user subscriptions to make money.
Airbnb is a platform for people looking for unconventional accommodation, which comes in the form of people’s houses, spare rooms, or even couches. It has over 100,000 listings in 192 countries and has booked over 10 million nights worldwide.
Founded in 2008, Airbnb has quickly become a disruptive force in the hospitality industry with rapidly growing revenue figures, and a valuation last year of $1.3 billion. The site produces nothing at all, but charges travelers a service fee of 6-12%, and necessitates hosts to pay 3% of the booking fees they receive for renting out their space.
Dropbox has revolutionized online storage. The file hosting and sharing service offering cloud storage was only released in September 2008 but it already boasts over 175 million users, according to TechCrunch, who also note that Dropbox’s 2013 revenue has reached $200million.
The company relies on subscriptions to its freemium service to make money, and is now valued at over $4 billion. That’s an impressive sum, considering that most of its users don’t pay for the service.
4. 99 Designs
99 Designs, operated by SitePoint, is a logo design site where designers compete to create logos for clients. Clients advertise what kind of design they’re looking for and how much they’re willing to pay. Designers then compete in what the site calls ‘design contests’ and one winner is chosen by the client after all entries have been submitted. The chosen designer is then paid for their work. All 99 Designs does is provide the platform for this to take place, and charge a fee for every logo commissioned.
Elevatr is an iOS app designed for those serial entrepreneurs with too many startup business ideas floating around their heads. The app allows users to monitor and keep track of their business ideas, as well as help them to build business models, with the aim of turning vague thoughts into worthwhile ideas.
The app will take the user through business model creation, target market and market size identification, differentiation, competitors and more.
Elevatr makes its money by taking a commission from service providers that it connects its users with, for services such as website and app design, and business strategy. However, the app is free to download and the company doesn’t take a penny from its users. Company founder David Spiro states that the app hit 70,000 users in its first 30 days.
About The Author: The post is written by Ilan Nass on behalf of Fueled – New York based leading iPhone application developers and masters of mobile design.