Convertible Notes and Startup Funding
February 12, 2025
Taxes can be classified based on which class of the population pays the most. The purpose of taxation is to redistribute wealth from the rich to the poor. Taxes that help the government do the same are called progressive taxes. The corporate tax has been levied on the premise that it is a progressive tax. […]
In the previous articles, we have already seen how the use of securitization has grown in sports. We also know that the increasing use of securitization is because of certain benefits that are provided by this method of raising capital. However, it is important to note that securitization is a part of structured finance. Structured […]
The primary function of investment banks is to help their clients raise equity capital. This is often done by initial public offerings. This is where investment banks provide their biggest service i.e., underwriting. Most people have a basic understanding of underwriting. They know that when an investment bank underwrites a share issue, they guarantee to […]
The economics of sports leagues is quite complicated. This is because of various factors. However, two of the most important factors are: The revenue is generated at the central level i.e., by the franchisor, and at the franchise level as well i.e. local revenue. For instance, broadcasting rights are monetized at the central level. However, […]
One can never really understand a subject, unless they know where it came from. Therefore, a short history of the subject of accounting may be of interest to students of accounting. Here is a very brief history of how accounting evolved: Single Entry Accounting System Accounting is as old as financial transactions themselves. As soon […]
The Product as a Service (PaaS) business model is poised to change the business world in a big way. There are many traditional industries that are being disrupted by this model. Start-ups, as well as established corporations, are all taking steps to adopt this model. Many industries such as automobiles and electronics are likely to be fundamentally transformed by this business model. This is the reason that venture capitalists are looking to fund more companies that are built upon the Product as a Service (PaaS) business model.
Hence, it is important to understand the advantages of this model in more detail. In this article, we have listed the most important advantages of the Product as a Service (PaaS) business model.
The Product as a Service (PaaS) business model is highly popular because of the advantage it offers to both parties. The details of the advantages have been mentioned below:
Advances in the “internet of things (IoT)” are making it possible to collect data from various kinds of machines and then analyze such data. Hence, companies are in a position to move from preventive maintenance to predictive maintenance. This means that companies can maintain vehicles and other equipment better than the end-users. They can use these economies of scale to make the model more affordable to the end-users without actually cutting down on their profitability.
With the advent of the Product as a Service (PaaS) business model, there is no need to borrow money and take on the liability. Instead of making monthly payments to the finance company, they can make the same payments to the manufacturer, and that too without any commitments or obligations! They can stop making the payment at a short notice and they will not owe the manufacturer any money since they were paying subscription fees and not loan installments.
Given the long list of advantages, it should come as no surprise that a lot of start-up companies are being built around this concept. Some of these companies have already gone on to become unicorns.
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