I’ve decided to go for a business model closer to video games than SaaS. Essentially, for any normal business, the rule is to have cash collection that will be greater than the cost of product and the cost to acquire a customer. The only case where having anything lower than that is permissible is the subscription model, where maybe you spend a lot on customer acquisition. So you recover some money in this payment and recover everything else and some profit from next payments.

The problem with software as a service is that the payback period is very, very long, mostly because the customer acquisition costs are high. The prices are anchored at around $20 month, and customer acquisition cost is north of $60-$80. At bare minimum, you’re going to have a 3-4 month payback period. What if LTV is $85 but CAC is $80? You’re profitable but barely, and it took months to learn this. Do you scale? Pivot? You’re in purgatory. Can’t even exploit trends because your payback is months

On the other hand, games have one-time payment because a lot of times they are like consumables or can also be looked at like books that hey you buy it, you play/read it for a while and then forget about it. Sometimes you just buy it and don’t even use it. Same for a book. Since the usage is not for a long period, people won’t be paying for subscriptions. Out of compulsion, they need to have one-time payments only.

It also means that if you are developing software as a service, then you need to solve for a recurring problem that keeps going on and on so that subscriptions make sense, and that constraints ideation a lot. On the other hand, one-time payments provide us with a lot of freedom. You can solve for things that are eternal or also for things that are trivial because once payment is done, it is none of our business. It’s up to the user to use it however they see fit. You can make something that would be passed down as a family heirloom or something that will end up in the trash can right after two minutes.

That means you have way more creative freedom when it comes to one-time payment products. Novelty, taste, impulses are also dimensions that get unlocked that you can explore while ideating for a product.

Well, enough with the premise setting, let’s get to the point.

In physical products, there is a clear AOV boundary beyond which you have to be otherwise you will not be profitable.

Let’s say the customer acquisition cost for some physical product is $10 and shipping will be $6. So $16 is going to be the cost regardless.

So if your product is just $15, then you are going to be in the red. That’s why people start bundling instead of selling just one thing. They will sell 3 of them at some discount, they will sell it at $40 and the cost is like $16, so they pocket $24. Same product, but now it is viable because there is bundling, there is expansion of AOV.

For physical product, it makes sense, but I haven’t explored this in terms of digital products. You cannot just sell the same software three times to the same person, right? Maybe you can sell licenses, but if it is a sole user, you cannot just sell the PDF reader three times. Thus, maybe you can go for B2B and sell a lot of licenses, or you can go B2C and bundle it with other digital products.

For the B2C route, you actually need to know what other digital products exist.

1. Software templates like Canva or Figma files or Notion files
2. Digital files like Excel calculators or PPT slide decks
3. Info products such as PDFs, videos, and audiobooks
4. PC software
5. Asset packs
6. Chrome extension
7. Plugins for things like Excel, PowerPoint, or whatever

There can be more, but let’s expose synergy for bundling here. Let’s see your targeting keywords on Google that go like Excel modeling. The bundle here can be Excel modeling template information product and plug-in that help you with model review.

Essentially for any keyword, it can be a trifecta of:

1. Template
2. Information
3. Tool that streamlines a process

You run ads for those keywords, drive traffic, sell people this bundle so that you have good enough AOV and boom!

Best part is, either it works or it doesn’t. You do not have to wait for months to figure out if we are going to reach total payback or not. If the AOV and CAC seem out of whack, then you need to change things up. There is instant feedback. In a small ad spent amount, you can get a lot of data instantly, instead of waiting for the whole payback period, like you would have to do in software as service products. Essentially, I do not like software as service because the payback period thing introduces a lot of uncertainty and inflates time when it comes to figuring out if we have a product that actually has demand and is commercially viable. If your payback period is 8 months, you have to wait for 8 months to figure out if people would even pay enough for us to break even. You physically cannot know about it beforehand.

You can validate 5-6 bundles in a time where SaaS would not even complete its estimated payback period. In a short time, you can test different keywords, different products, and different bundles at a really affordable cost. Since I do believe this is a volume game, then switch to one-time payment products and bundling of them makes 100% sense.

Plus, there cannot be idea poverty here. There are so many niches like, let’s say, Excel financial modeling, then there is something as personal as sleep, then there is sound effects for content creation. A lot of niches like you can just look at what someone is doing, figure out what would be the search intent, and then come up with products. Very easy.

Like every Google search out there that has commercial intent can be monetized by having products spawned from the traffic I discussed about. I can then just bundle them, figure out the ads, the SEO, the pricing, and a bit if it works fine, or just move on to the next thing, target another search intent. Plus, even with the trifecta, I’m not saying that you are supposed to sell three products for those three types. I’m saying that those trifecta can give you a lot of product ideas, and you can bundle those products, even if they’re from just a single component of the trifecta.

Beyond this bundling info products also helps you tighten the targeting a lot. If your digital product comes bundled with an info product that makes it specifically useful for a narrow niche, then you will just reduce your customer acquisition cost for that niche by a lot. For example, if I am buying some Excel plug-in for financial modeling and I see that just for $5-6 they are bundling together a course about tools use case that is made specifically for the role and industry I am working at, then hey, I would happily pay for it.

Another example can be that you made some software that helps people find the Oxford comma or its absence in legal documents. But if you attach a course in the bundle that essentially says this is where you’re supposed to have that comma, this is where you’re not supposed to have that comma for personal injury litigation, then hey, you just added so much value! You can even just partner with people who have authority in that domain and give them a bit of cut. You unlock some distribution also.

from claude

SaaS:

Spend $1000 on ads in Week 1
Get 15 customers at $20/month
Revenue = $300/month
Payback = 3-4 months minimum
You won't know if it works until Month 4-8
If it doesn't work, you wasted 8 months

One-time payment digital products:

Spend $1000 on ads in Week 1
Get 30 sales at $40 each
Revenue = $1200
You know by Week 2 if it works
If CAC is $33 and AOV is $40 → profit $7/sale → it works, scale
If CAC is $50 and AOV is $40 → losing $10/sale → kill it, try next thing

Example: "Excel financial modeling" keyword

Option A (trifecta bundle):
Template + Course + Plugin = $49

Option B (template-heavy):
10 different financial model templates
Quick-start guide PDF
Bundle = $39

Option C (info-heavy):

3-hour video course
50-page PDF workbook
Practice exercises Excel file
Bundle = $45

Option D (tool-focused):

Excel plugin for model auditing
Chrome extension for financial data scraping
Templates to use with the tools
Bundle = $49

All solve the same search intent. All hit $39-49 AOV. All work.

Hate coding tools? → Focus on templates + info
Bad at teaching? → Focus on templates + tools
Can't design? → Focus on info + tools

My specific recommendation
Week 1: Pick ONE keyword in a domain you know

Search it on Google
Look at what's selling (Gumroad, Etsy, paid ads)
Note the price points

Week 2: Create the simplest viable bundle

Week 3: Run $200-300 in ads

If AOV > CAC → you have a winner, iterate
If AOV < CAC → kill it, try different keyword