Statistics show that there are more and more subscription-based services. From 2014 to 2018 the industry grew by 890% as shown in the graph below. This is a very telling statistic. Industry giants believe that the subscription-based industry will be growing significantly in the future. You want to be part of the revolution!

Source: Hitwise

Here are some interesting statistics about subscriptions :

  • By 2022, 53% of all software revenue will be generated from a subscription model
  •  All new software entrants and 80% of historical vendors are offering subscription-based business models
  • 63% of publishers say turning audiences into paying subscribers is a key challenge when creating subscription products
  • 70% of business leaders say subscription business models will be key to their prospects in the years ahead
  • 9. 53% of senior finance executives say at least 40% of their organizations’ revenues are recurring
  • The average subscription billing vendor is growing 30%–50% annually

More about the statistics you can read in this article :

Finances and the subscription model

If we will continue to see the rise of subscription-based services we can be sure that it will influence the finances as well. There are already many subscription-based trading environments and traders who share their trading signals based on a subscription model.

The service which can not only provide you with information and can also work for you based on a fixed monthly fee is offering a lot of value. You will find many traders who are giving away their trading signals for a monthly fee. But there are also services that provide customers with a whole package. They help their customers establish their trading account, educate them as well as manage your assets transparently and professionally for a monthly fee.

The classic fee structure in finances 

Majority of fees in finances consists of 4 types of fees :

  1. Entry fee
  2. Management fee
  3. Profit share
  4. Exit fee

1.that’s the amount of money you pay so you can participate in investment or a financial product.

2.that’s the amount you pay to the asset manager for the service of taking care of your investment, that being buying and selling at opportune moments and making long term gains.

3.that’s the amount of profit you share with the asset manager or the institution.

4.that’s the amount you pay when you want to liquidate your funds or in other words, take them out of the fund or your investment and invest them somewhere else.

Example: 30% of the gains made on your investment is held by the asset manager or institution for their work. Meaning you split the profit 70% of gains for you and 30% for the asset manager/financial institution. In numbers, if your investment gained 1.000€ you keep 700€ and 300€ goes to the asset manager/financial institution.

Not every financial investment consists of all four of them some only include two or three of them, but still, they vary based on the amount of money you have invested plus they are usually bound to a certain period of time and are therefore not liquid or for a very high fee as well as untransparent.

What are the benefits of subscription-based management fees?

The major advantage of the subscription-based management fee is that you don’t have to share your profit, you have no entry fee, no exit fee nor management fee. Your monthly expense is always the same no matter the gains you make, which in a market like the crypto market it can be very beneficial, especially if you are invested for the long term.

You can predict with greater ease what your monthly balance will probably look like, which helps you to easily predict your future investment or maybe liquidation of your funds.

Benefits of the subscription-based model of management fees :

  • No entry fee
  • No management fee
  • No profit-sharing
  • No exit fee
  • Easier prediction of the future investments/liquidation of funds
  • Better overview of your funds

Conclusion :

Future, as it seems, holds more and more developments in the subscription-based models and finances are no exception. We believe that subscription-based models are very valuable for the customers as well as the company. Both participants know what they get in a very straightforward and transparent way and it is easily measured as well as predictable.

Highwater offers a subscription-based model of asset management, please check out more on our web page :