The best thing I did for my business was switch my company to a recurring revenue model. Originally we were only taking a 3% cut which created little predictability for our bootstrapped start up. 3 months after launching we switched to having 2 plans: Free or $12/mo for an unlimited amount of products (of course we later realized that this was also a terrible deal for us and had to change our pricing model)

I just learned about another ycombinator/TechStars incubator called SproutBox in Bloomington, IN. What I thought was pretty cool is they look for ideas with recurring revenue – which is great! I really think it will save a lot of businesses from the inevitable “We couldn’t get funding so we had to go back to our jobs”

However….

Don’t fall into the recurring revenue trap like I have!
The biggest con to recurring revenue (especially in my case) is that it might end up being a small business. If it doesn’t fail you will keep moving it along trying to grow it since you can pay yourself and others (also there is no point in taking outside money since you have cash). What you have is an awesome small business not something that can be VC backed and grow to 100’s of employees.