As an investor, I’ve run across a species of startup — and sometimes even more than startup — that acts as if it were a technology-powered platform of one sort or another, but is in fact a group of staffers frantically updating, tweaking, massaging, typing in commands, etc. behind the scenes.
I’ve started calling this kind of a company “service as a software”.
There’s some reason to do so. SaaS companies are famous for having revenue leverage; once you’ve signed up subscribers (and provided they don’t churn) your revenues from them recur without any new cost or effort on your part.
Service-as-a-software companies are just the opposite: you never get out of the customer-acquisition cost, because keeping customers going requires labor power every step of the way. Instead of recurring revenue, these businesses have “recurring CAC”.
Write in with your favorite examples of “service-as-software”…