Simple Math Behind 1 Million-Dollar Revenue Model

Simple Math Behind Making $1,000,000 in Revenue

08 Nov Simple Math Behind 1 Million-Dollar Revenue Model

Raise your hand if you had set $1,000,000 goals for your business, but it still feels like a farfetched goal?

You are doing everything you were told to do by the online gurus: publishing content, sharing it on social media, creating interesting offers, growing your lists…

But you are still not there.

You see Facebook ads with these marketing gurus posing in front of their private jet boasting 7- or 8-figure income.

So, you may be telling yourself – why is it not working for me?

Truth be told. $1,000,000 is a huge number.

It is NOT easy to achieve and it most certainly does NOT happen overnight.


And quite a few of these jets are not real – they are simply rented for the guru’s photo-op…

Well, some of them are actually making $1,000,000, but they are also spending $990,000 along the way.

At the end of the day, making $1,000,000 online is a numbers game.

I worked with several businesses that grew from zero to multi-million dollar revenue streams.

They were in different industries and had different, they all started with one simple principle

1 – Reverse-Engineer Your Revenue Goal and Pricing Model

Making $1,000,000 online is simply a numbers game.

If you are selling widgets for $1 apiece, you will have to sell 1,000,000 widgets to make $1,000,000.

It sounds daunting by itself.

But you also have to think HOW to find 1,000,000 people to buy these widgets.

Your costs may be too high and it will take you too long.

Let’s imagine your widgets are $100 apiece, this means that you will need to sell 100,000 widgets.

Better than 1,000,000 but still quite a lot!

What if you sold widgets at $1,000 or $10,000 apiece?

Do you see what am I getting at?

Now, let’s make things even more interesting.

What if you were selling a monthly subscription service to your widgets?

If you sell your widgets for $16.7/mo, you would need to have roughly 5,000 subscribers

$16.7 x 5,000 x 12 = 1,002,000

And if you increase your price to $84/mo, you will just need 1,000 people.

Want to have even fewer subscribers? Offer 250 people a $334/mo subscription and you will be all set.

The simple math behind $1,000,000 a year business


If you are not ready for a $1,000,000 what about 25 people buying a monthly $334 plan from you?

$334 x 25 x 12 = $100,2000

That’s 6-figure income from figuring out a high-value relatively low-cost product and selling it to 25 people!

Before you start selling anything, play with your numbers.

2 – Do a Reality-Check of Your Numbers

If you are selling a $99/mo product, it means that you may have to acquire and maintain 950+ customers every month.

Next questions to ask:

  • What would it take to acquire 950 customers? Cost, Marketing Strategy, Time?
  • Can my business support and provide quality service to 950 customers at the same time?
  • What processes and systems do I need to put in place to support them?
  • How large would your team need to be?

If you are selling membership access to your digital products or in the eCommerce business, then the support cost goes down significantly.

Your main concern becomes the cost of acquiring and retaining the 950-customers.

As a rule, subscribers stay with the service for 4-6 months. This means that over the course of the year, you will need to acquire at least 1,900 customers.

(950 x 6 month) x 2

However, if you are a freelancer, an agency, or a Done-For-You services-provider, supporting that many customers every month may not be an option.

This is on top of acquiring and retaining them!

An average freelancer can provide quality support to no more than 10 customers at the same time.

If you offer services at $99/mo, then the most revenue you can generate would be $11,000 a year

$99 x 10 x 12 = $11,000

At $999/mo your revenue goal looks much more promising and manageable.

$999 x 10 x 12 = $119,880

You can increase the price and reduce the number of customers to stay at the same revenue goal OR increase the price and keep the customers at the same level to make more.

Simple Math Behind Making $1,000,000 in Revenue
Do a Gut Check of Your Revenue Projections

3 – Diversify your Revenue Model

One of the biggest issues for many businesses is ebbs and flows in revenue.

If you are in eCommerce, then the Holiday season is your biggest revenue maker.

You market, package, ship, respond to customers like mad.

Then come January everything stops!

You have to come up with crazy promotions just to sell a few pieces.

It is quite the opposite if you are a coach or consultant.

Many people “check out” during the summer months and Holidays. They rush to hire you again to help with their New Year resolutions.

But then you are so busy serving your clients that you do not have time to market your services.

There are three key strategies for keeping a stable cash flow

1 – Creating an Automated Lead Generation System

An automated Lead Generation System will continue bringing potential customers into your business even when you are busy.

If you do not already have a lead-generation system that runs on auto-pilot, you may find yourself scrambling once things slow down.

READ THESE IF YOU NEED HELP WITH FINDING CUSTOMERS Top Strategies for Online Lead Generation and How To Get More Customers for Your Business – Step by Step Guide

2 – Combining 2-3 different revenue models to combat a slow time.

The secret is in adding another revenue stream that can help support your business during slow times.

Brainstorm different types of offers:

  • Physical (products you can ship, print books, t-shirts, items)
  • Digital (downloads, checklists, templates)
  • Spoken/Written work (ebooks, audiobooks, training)

Look at different options for making money online:

If you do not have a physical product, learn more about dropshipping.

3 – Create Recurring Monthly Revenue Opportunities

At the foundation of every successful online business is recurring monthly revenue. This revenue can come from subscriptions, affiliate sales, monthly contracts.

If you are a coach who has a large online following, consider offering a monthly membership to your digital courses and ebooks, look into affiliate programs.


Making $1,000,000 is not easy, but it is more realistic than it seems. You start by reverse-engineering your revenue goal and pricing. Then do a reality check of your numbers – can you REALLY handle 500 customers every month? Lastly, wrap this all into a business model with several complementary revenue streams.


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