Key Takeaways:
- NFT memberships transform the software your business relies on into an asset.
- The NFT membership model enhances the customer experience.
- Businesses using NFT memberships can still produce predictable revenue.
Is your software an asset or a liability?
An asset adds value over time. A liability detracts from it. And if you’re using traditional Software-as-a-Service (SAAS) products, you may be stuck with the latter.
That’s not to say there isn’t true value created by traditional SaaS services, from the first CRM platform created by Salesforce in 1999 to modern services like Zoom, Slack, or Asana. There is a reason why the global SaaS market is projected to reach nearly $375 billion by 2026.
Companies are willing to pay pricey SaaS subscriptions because it affords them high accessibility. Rather than dropping a large amount up front, businesses can spread their costs out with a low monthly rate.
That gives them the flexibility to benefit from essential software services without getting in over their head, a critical boon for startups that can’t afford to front large sums before proving they can turn that investment into profit.
Think about financing a house purchase. Rather than stockpiling cash to purchase a house upfront, SaaS allows you to space out those payments over time. It gives you access to a high-value object for a fraction of the cost.
That access doesn’t come for free in the big picture though. Just like your mortgage lender, the SaaS company charges a markup. While a home can be an asset, it can also be a liability, if its costs — from the monthly payment to repairs — outweigh its worth. In the long term, home ownership ends up being an asset because those costs are typically offset by appreciation as you gain equity.
But with SaaS companies, you never gain equity. You’re a renter, not a buyer, paying the protracted costs of use without ever receiving the benefits of ownership. You have no say over the service, which can change its price, interface, or terms of service with little repercussions, leaving you in the cold.
Traditional SaaS companies can add tremendous value. However, they can also quickly become liabilities while dragging down your bottom line and offering you little control over the products you’ve come to rely on.
Using NFTs to empower ‘Software as an Asset.’
SaaS companies love subscriptions because the revenue is predictable, allowing them to more precisely plan and fundraise for future growth. Customers willingly trade the benefits of ownership for the value of getting reduced-price access to the software that powers their work and life.
What if businesses didn’t have to make that trade-off?
That is the promise of NFTs, or non-fungible tokens, the distinct pieces of digital data stored on a distributed ledger such as the blockchain. Major household names, including Coca-Cola, Nike, and Ralph Lauren, have launched their own NFT collections, preparing themselves for the widespread adoption of web3 and mateverse technology.
Already, Creative industries, from music and art to gaming, have been disrupted by NFTs. And more are coming, with the Harvard Business Review dedicating a piece to the ways brands could authentically experiment with NFTs and emerging use cases. The SaaS model is one major area ripe for NFT disruption, precisely because it offers ownership where subscription software companies cannot.
One of the fastest growing web3 use cases is Membership NFTs, which grant their owners an ‘access key’ that opens the door to exclusive services, rewards, and private communities. That technology may end up disrupting many industries, but it has special potential when it comes to providing a form of tokenized software license. That’s because, unlike traditional SaaS services, an NFT license conveys immutable ownership on the blockchain.
Web3 companies can use that ownership to add extra value for users, far beyond mere software access. They can improve customer experience by giving NFT holders the ability to vote on software changes, for example, giving them a say over the services they depend on. They can also add royalties to their smart contracts, so that clients that sell their SaaS NFT get a portion of all future sales of that NFT (or potentially, a portion of all monthly payments made by future NFT holders for use of the service).
By awarding ownership over software through NFTs, web3 companies can turn Software-as-a-Service into Software-as-an-Asset.
How Sprinter does it.
Sprinter is using three types of web3 technologies — two NFTs and a token — to turn software into an asset.
The Helmet NFT serves as a tokenized software license. It grants platform access for Individual members, including the people who head projects (Leads) and the people who complete them (Pros). It also serves as a mint pass for the Sprinter Agency Badges. Genesis members get special access to the Sprinter roadmap and platform features, and receive an exclusive claim for the $RUN token airdrop.
The Badge NFT serves as an enterprise license for the platform. Badge holders can build teams and agencies in the network. Badge holders get access to an exclusive section of the platform that allows for the management of agency employees, contractors, and projects. Badge NFT Holders will also have a claim to the $RUN token airdrop.
$RUN is Sprinter's native token and serves as the payment token amongst network members. When Leads, Pros, and Agency Owners transact on the platform with $RUN, they receive a premium on their rates, and clients will receive a discount on their service when selecting to pay member vendors with $RUN.
NFTs end the SaaS customer experience death spiral.
In today’s SaaS environment, customer experience declines as customers grow. They receive less personalized care and fewer benefits, with the SaaS company offering low prices to build its subscriber base and then up-charging those subscribers once they are reliant on the service.
With their needs no longer being adequately met, customers inevitably leave — and the SaaS company eventually falters.
NFT-enabled SaaS companies can align incentives to enhance customer experience. With membership NFTs, customers can access a token-gated Discord that enables direct communication with the SaaS provider and other customers.
That NFT community empowers customers to discuss challenges with the software and offer advice for other users while maintaining direct contact with the software developers.
In addition to customer service, SaaS NFTs allow holders to propose platform improvements through governance.
After temperature-checking a potential change in the token-gated Discord, SaaS NFT holders can discuss key improvements and whether they would benefit the software’s user base as a whole.From there, an NFT holder can issue a governance proposal to vote on the upgrade.
When NFTs are implemented into SaaS products, customers get direct communication with the software provider and a greater say over the future of their software solutions.
NFTs work for businesses, too.
SaaS companies can’t afford to lose sight of their users’ needs. But when incentives aren’t aligned, they often do, leading to that previously mentioned customer exodus.
NFTs can ensure that SaaS companies stay in tune with their community’s needs. However, they also have other critical business cases.
Subscriptions have been the main business model for SaaS companies because they offer predictable revenue which, again, allows more accurate planning and fundraising for future growth.
By using NFT memberships instead of traditional subscriptions, SaaS companies get a double benefit — that same predictability, but with the added returns of future exponential revenue as well.
That’s because NFTs can have smart contract royalties included for the original SaaS providers, too. With each sale, another revenue stream is created. The SaaS company doesn’t profit off the sale of a membership NFT just once, but every time each NFT holder sells to the next one.
In short, the revenue from NFT memberships doesn’t stop after they are sold. Companies that leverage them have access to traditional revenue drivers, like marketplace fees, but they also add the value of recurring primary sales.
Those additional revenue streams can be analyzed to be as predictable as any subscription model, and they don’t solely rely on one income source — consider that Sprinter’s NFT sales make up just a small portion of the network's annual revenue.
Companies enjoy revenue predictability matched with new revenue drivers. Consumers benefit from the same cloud-based software as a service experience, while gaining new opportunities in customer experience and asset ownership.
