Jan 5
Software-as-a-Token (SaaT), NFT Recurring Revenue (NRR)
NFTs have unleashed a fundamental revolution in the way that software can be monetized through what we’re calling the Software-as-a-Token (SaaT) revenue model, to differentiate it from traditional Software-as-a-Service (SaaS). We will explain below how SaaT is greatly superior to SaaS in its ability to:
Software-as-a-Token (SaaT) vs Traditional SaaS
In the traditional SaaS model, once a student decides to cancel the subscription, that revenue stream will end and more money must be spent to acquire new users. Software-as-a-Token with NFTs allow us to build a “subscription chain”, where users are incentivized to “pass it forward”.
⛓️ Our current customers will find our next customers for us.
Royalty NFTs as access avatars is a key component to increase retention rate beyond a traditional SaaS subscription MRR or ARR models. Students who own the NFTs will be financially incentivized to find our next customers for us from their own personal networks. We will still earn revenue from future customers through royalty NFT smart contracts that will pay a portion of future NFT sales to the original creator (Figure 8c). We call this new revenue model NFT Recurring Revenue (NRR) to differentiate it from MRR or ARR.
Figure 8c — NFT Subscription Chain vs SaaS
We can make the comparison of this model to putting quarters to shopping carts in order to financially incentivize customers to return the carts for the next customer. The retailer can thus save money hiring staff to return the carts for the next customer (Figure 9).
Figure 9 — Quarters in Shopping Carts
Psychology of Expense (SaaS) vs Investment (SaaT)
The psychology of purchasing an NFT is also slightly different from paying for a monthly subscription.
💡 Paying for a subscription is a pure expense, but buying an NFT is an investment.
When we pay for a subscription, we will never see that money again. When we buy an NFT, we might get back more money than we put in. So we expect significant differences in conversion rates into paying customers between the SaaT vs SaaS models.
