No-Code’s Achilles Heel
Is no-code replacing technical limits with financial limits?
More software-that-builds-software exists than you might realize. Literally every day I see new things being built without code, non-technical people becoming profitable founders, and new tools and services to support this growing ecosystem.
If the trend continues, we have an amazing future ahead of us where everyone is truly empowered to change their world- not just the 0.3% who know how to code.
There’s something clouding that future, though, and I wanted to write about it: monthly software subscription costs.
I don’t think this problem will exist forever, and it’s not exactly out of control (yet), but I thought it’d be fun to imagine how paying for no-code might look one day.
The subscription problem exists in a lot of modern life, but no-code is a maker’s movement. The freedom to build without limits is a foundational principle. When we’re hacking together two or ten services per project, monthly subscription costs will limit what we can build.
Here’s a real-world example. The No Code List (a list of no-code software that I run as a side project) is built on a no-code stack. It doesn’t make any money, but I pay…
- $29/month for Ghost
- $10/month for Airtable
- $20/month for Zapier
- $30/month for Mailchimp
- $9/month for Simple Analytics
That’s a total cost of $98/month to run a service that generates $0 in revenue. And that’s a simple stack. With customers and revenue, I’d have more subscriptions.
It’s important to point out, however, that for every tool in those bullets except Ghost, the monthly price can cover several different projects. That makes a big difference if you’re building multiple products.
At the same time, most of those prices also go up with more use. So as a project grows, it costs more to use the underlying software. This isn’t a huge problem for revenue-generating businesses, but in a lot of other cases, it will be.
Possible outcomes/solutions
There are many ways paying for no-code might play out. If you make the assumption that subscription prices will be a problem, here are some potential things that could happen…
Cheaper subscriptions
In this scenario, we’d start by seeing more extensive free trials and better features in free versions. Eventually, though, the amount that everyone can charge will trend towards $0. That would just be logical market dynamics.
My guess is the market would settle around $5 or $10 per year as a “normal” subscription rate.
This may already have started. Carrd offers a useful and powerful free version and charges a low yearly subscription for paid versions. The lowest is $9/year.
Consolidation of software options
Another market-driven potential future is consolidation of our no-code software choices. To have low subscription costs, profitable no-code software will need large percentages of the market. Once they’re large, they can squash competition early because of network effects.
To capture this opportunity, a company (or two) would get a ton of funding, sell subscriptions for cheap or free, and build so many features that no one will be able to compete (at their price). We saw this with web 2.0 companies like Facebook, Uber/Lyft, etc.
Bundles
A different idea- one where subscription costs stay where they are- is bundling software together. Several, related softwares could offer slightly reduced subscription costs and closer integrations when bought as a bundle. Potentially, we’d see common no-code stacks sold as bundles… which would actually make no-code development even easier for newcomers!
Services, upsells, and ecosystems
If bundles seem like more of a band-aid, then consider selling services in addition to subscriptions. Currently, software companies charge more for additional features. In the future, we could see in-house consulting services, education and auditing services, client and freelancer matching services, software-specific app and plugin stores, and more. We’d see ecosystems forming around each no-code tool, and within each ecosystem, there will be additional revenue streams to supplement subscriptions.
Crypto and tokenization
Using crypto and tokenization also creates new opportunities to make (and save) money. Tokens can be used to incentivize behavior and reward people (and the software company). By adding crypto into an ecosystem, we can create additional revenue streams and rely even less on monthly subscriptions.
Here’s an example of how a token fits into a software ecosystem:
- Users of the software buy tokens (from the company or the open market) to put a bounty on a forum question
- The accepted answer gets paid the bounty in tokens
- It would cost tokens to get listed as a partner on the software’s website
- It would cost tokens to list a plugin in the software’s app store
- Holding more tokens would get you more features or priority support
In these examples, the software company earns revenue from selling tokens, earns those tokens back in exchange for pre-vetted users who get more exposure for their work, and they save on support costs by incentivizing user-generated support.
Scale as a counterpoint
One counterpoint to all of this is that the scale of people who will actively pay for no-code software could be unimaginable. If that happens, many different solutions could exist simultaneously, and they might all charge small amounts but to many more people. In this scenario, a lot of software could exist and be profitable.
With the information we know today, I’d gamble that the size of the market will, in fact, allow for lots of choices at low prices. A market of that size, though, will also attract sophisticated businesses who will bundle, add services, and maybe even use crypto tokens to earn as large a piece of that market as they can.
No-code is likely to be enormous with an abundance of opportunity. As evidenced by recent VC backings- $72M for Webflow, $80M for Unqork- the no-code space is about to get truly competitive. I think pricing will become a key differentiator.
Original cover photo by Nino Liverani on Unsplash. Edited by me. Feel free to use it for anything.
This article originally appeared at x.workandwhistle.co/no-code/no-codes-achilles-heel/
