Journey: $0 to $14,200/mo reselling SMM services — month 11 update

Month 11. Started this thread at $0 with a $140 child panel. Full numbers as always.

Month 11
Revenue $14,210 · provider costs $8,940 · panel hosting and software $190 · support VA $620 · ad spend $810
Net $3,650

The eleven months
M1 $180 · M2 $640 · M3 $1,210 · M4 $1,090 · M5 $2,340 · M6 $4,180 · M7 $5,920 · M8 $7,140 · M9 $9,880 · M10 $12,400 · M11 $14,210

What changed in month 11
Moved 40% of volume to a second provider after the first had an 11-hour outage during a promotion. Margin dropped two points, reliability complaints dropped to almost nothing. Correct trade.

What is still broken

• Margin is 26% and falling. Everyone resells the same four providers and price is the only axis left
• 71% of revenue is from 19 reseller accounts. If three of them leave I lose a month of growth
• Support is 24/7 and the VA covers 8 hours. The other 16 are me, which is not sustainable and is why month 12 might be flat

What I would tell month 1 me
Do not compete on price, you cannot win that and neither can anyone. Compete on the API docs and the support response time, which is what the resellers actually buy.

Month 4 dipping below month 3 and you leaving it in the table is why this thread is credible. Nine out of ten journey threads have a monotonic graph, which is not how anything works.

26% and falling on a reseller model with four upstream providers is the structural problem, and no amount of execution fixes it. The exit is your own supply or your own audience.

Agreed, and that is month 13-18. Either I buy capacity directly or I stop reselling and build the panel software, which is the only part with a moat.

71% from 19 accounts would keep me awake. Have you tried contracts or volume commitments, or is that not how this market works?

Not how it works. Resellers move on a two-cent price difference. I have tried discounts for commitments; take-up was about 1 in 10.

As someone who buys from panels occasionally: the API docs point is correct. I have left two panels that were cheaper because the docs were a Google Doc with no error codes.

The 11-hour outage is the whole argument for two providers at a worse margin. Reliability is a product feature and you only find out what it is worth when you lose it.

What was the $140 at the start actually spent on?

$25 child panel, $15 domain, $100 of float so the first orders could be fulfilled before customers paid. The float mattered more than the panel.