Tuesday, October 13, 2020

Revenue Models in Startup Companies



An MBA graduate from the University of Miami, Marguerite Cassandra Toroian worked as an equity research analyst with Emerald Asset Management, Lancaster, where she focused on the banking sector. Based on her interest and expertise in building financial models, Marguerite Cassandra Toroian assesses startup companies using revenue models to determine their profitability in the future.


A revenue model is a basis for generating financial income in a business. It helps identify the revenue source, offer value to customers, and determine how customers pay for the value. The type of business model that will be adopted eventually for revenue generation in a startup company depends mostly on various factors such as scalability, market potential, and competitors. Therefore, to forecast the future of the company and its long-run profitability, there's a need to research appropriately and seek advice from investment experts.

Some of the earning models available to startup companies are the direct sales model where a company makes earnings from selling goods or services directly to consumers, the subscription-based model which generates revenue by offering products and services where customers pay a monthly or yearly charge, and the affiliate revenue model where affiliates promote relevant products or services and get commissions based on an agreed percentage.