Charging for things on the web

I just closed the sale of Lifepath.me to a Singaporean guy who bought it on eBay, and I figured it would be prudent to do an accounting of the time spent and revenue I pulled in from the service. Before that, though, I want to touch on the single most important lesson I learned through the process. I hadn’t been expecting to charge for accounts, but the Stripe javascript payments API was so easy, I figured it would be a cool gimmick. It turned out to be slightly profitable (for more than I had expected, to be sure), but more than that, it changed my perception of charging for things on the web.

People are willing to pay for things. It’s amazing! People are willing to put their credit card number into a form to buy things, and while that seems stupidly obvious to anyone who has ever bought anything, it doesn’t really hit you as a product developer until you after start getting “new payment” emails. For some reason, the default assumption is that charging for things on the web will never work, but, once you try it, even for something stupid like a life timeline, you might realize that assumption is incorrect. Sure, you might not be able to support a whole industry (newspapers) or a even a salary, but there is definitely some uncaptured profit there.

I don’t think Stripe is just a payments API into a pre-existing market, I think there’s an opportunity for them find a new market of people who never even considered charging for things on the web. People like me, with little side projects or with simple services. I am obsessed with payments innovation, so I’ll probably be writing more about this later.

Anyway, here’s the final tally:

Throughout the process, I charged between $1 and $13 for each account, but after some testing discovered the sweet spot was $5.

Revenue through credit card payments (Stripe and Paypal):
$3,880.

Revenue from eBay sale:
$10,200

Cost of operations (hosting, etc):
$120

I spent about 400-500 hours (let’s say 450), for a net profit per hour of:
$31.02

And total net profit:
$13,960

For a side project that I had no intention of charging for, or of selling, I consider that a success. Experiment over.

You should follow me on Twitter here.

 
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