Did you know that 95% of startups never reach $1 million in revenue? That’s right, only 5% hit that major milestone. Entrepreneurs’ Organization (EO) requires a minimum of $1 million in revenue to apply, and has done so since inception almost 25 years ago. Of course, $1 million 25 years ago is more difficult than today, but achieving $1 million in revenue is hard regardless. Very hard.
Let’s look at a few examples of what it takes to hit $1 million in revenue:
- 50 services deals at $20,000 each (a little over four per month) delivered to completion
- 83.3 customers paying $1,000 per month at the beginning of the year (assuming no churn and no new customers)
- 1,666 customers paying $50 per month at the beginning of the year (assuming no churn and no new customers)
- 100,000 products at $10 each ($10 each selling direct or to a distributor that then marks it up further)
As you can see, it takes quite a few sales regardless of the type of business model to achieve $1 million in revenue. My recommendation is to think through what it will take for your startup to hit $1 million in revenue, and to have that as one of your goals.