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Entrepreneurship & Startups vocabulary · Ideas & Business Models

Subscription model

Meaning in entrepreneurship & startups, with examples

nounCommon term

In entrepreneurship & startups, subscription model means: A business model in which customers pay a regular fee, usually monthly or yearly, to keep using a product or service.

In Turkish: abonelik modeli, abonelik iş modeli

How it is used

Investors like subscription models because revenue is predictable and recurring. Teams offer monthly and annual plans and focus on renewals, retention and churn. The model is used in software, media, food boxes and many other sectors.

Example sentences

  1. Moving from one-off sales to a subscription model made our revenue much more stable.

  2. With a subscription model, every customer who cancels hurts next month's numbers.

Common collocations

  • move to a subscription model
  • monthly subscription
  • annual plan
  • subscription revenue
  • SaaSSoftware as a service: software that customers use online through a browser or app and pay for with a regular subscription instead of buying it once.
  • MRRMonthly recurring revenue: the predictable income a subscription business earns every month from active customers, not counting one-off fees.
  • churnThe loss of customers or subscribers who stop using or paying for a product in a given period, usually measured as a monthly or yearly percentage.
  • freemiumA business model in which the basic version of a product is free and customers pay for extra features, more usage or a premium plan.
  • business modelThe way a company creates value for customers and earns money from it: who pays, what they pay for, how much and how often.

More terms: Ideas & Business Models

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