Producer ownership hierarchy of needs
Created and written by Anna Shausmanova, Head of Design, and Will Godfrey, Founder & CEO
August 2, 2023
Embarking on a Hardware-as-a-Service (HaaS) journey? It's exhilarating, challenging, and almost certainly the correct course for your company, customers, and the environment. Each company's ride is distinctive, but after countless conversations with enterprises navigating this rollercoaster, we've sketched a mental roadmap that caters to most. A roadmap you can tread.
We've cheekily borrowed Maslow's hierarchy of needs, swapped out the physiological essentials with insights from producers, and voilà - we have a HaaS-oriented survival guide. The premise is crystal clear: we've observed companies tottering on the brink when they attempt to soar before they've mastered the fundamentals. These premature leaps, sans a comprehensive grasp of their business's economic DNA, cause hiccups down the lane.
Our mission goes beyond merely observing this; we aspire to illuminate the path, dissipating the fog of uncertainties. We aim to guide your focus, indicating what to concentrate on and when, like a trusty compass on this wild HaaS journey. Stick with us, and you won't be left scrambling for the next step. Here's our perspective.
Embarking on a Hardware-as-a-Service (HaaS) journey? It's exhilarating, challenging, and almost certainly the correct course for your company, customers, and the environment. Each company's ride is distinctive, but after countless conversations with enterprises navigating this rollercoaster, we've sketched a mental roadmap that caters to most. A roadmap you can tread.
We've cheekily borrowed Maslow's hierarchy of needs, swapped out the physiological essentials with insights from producers, and voilà - we have a HaaS-oriented survival guide. The premise is crystal clear: we've observed companies tottering on the brink when they attempt to soar before they've mastered the fundamentals. These premature leaps, sans a comprehensive grasp of their business's economic DNA, cause hiccups down the lane.
Our mission goes beyond merely observing this; we aspire to illuminate the path, dissipating the fog of uncertainties. We aim to guide your focus, indicating what to concentrate on and when, like a trusty compass on this wild HaaS journey. Stick with us, and you won't be left scrambling for the next step. Here's our perspective.
Deciphering the Hierarchy of Needs
Deciphering the Hierarchy of Needs
Deciphering the Hierarchy of Needs
Model/Product Viability
The first stop: Is the HaaS model right for you, and does your product slot into this blueprint?
As you embark on this journey, your checklist might include some heavy-duty tasks. You'll need to comprehend the financial modelling for your new business model. Experiment with every facet of this using Twist. Understand your product's lifetime, contract structure, total cost of ownership, and acquisition costs. These elements merge to give you the optimal approach over time.
Start small, setting up fundamental tools like CRMs and payment systems, and determining your servicing capabilities and internal needs. We notice most companies begin with customers proximate to their HQ to mitigate costs while keeping the experiments close to home. They might tweak a few major dynamics of their business model, like price, contract length, and the level of SLA.
The first stop: Is the HaaS model right for you, and does your product slot into this blueprint?
As you embark on this journey, your checklist might include some heavy-duty tasks. You'll need to comprehend the financial modelling for your new business model. Experiment with every facet of this using Twist. Understand your product's lifetime, contract structure, total cost of ownership, and acquisition costs. These elements merge to give you the optimal approach over time.
Start small, setting up fundamental tools like CRMs and payment systems, and determining your servicing capabilities and internal needs. We notice most companies begin with customers proximate to their HQ to mitigate costs while keeping the experiments close to home. They might tweak a few major dynamics of their business model, like price, contract length, and the level of SLA.
The first stop: Is the HaaS model right for you, and does your product slot into this blueprint?
As you embark on this journey, your checklist might include some heavy-duty tasks. You'll need to comprehend the financial modelling for your new business model. Experiment with every facet of this using Twist. Understand your product's lifetime, contract structure, total cost of ownership, and acquisition costs. These elements merge to give you the optimal approach over time.
Start small, setting up fundamental tools like CRMs and payment systems, and determining your servicing capabilities and internal needs. We notice most companies begin with customers proximate to their HQ to mitigate costs while keeping the experiments close to home. They might tweak a few major dynamics of their business model, like price, contract length, and the level of SLA.
Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future.
Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future.
Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future.
But here's the million-dollar question: Does your customer want to buy this way? Does this model help reduce your cost of acquisition? Does it unlock a completely new market? Perhaps in some instances, customers are already asking for this model that you don't currently provide. In other cases, we've seen companies advertise their HaaS to test its performance against a sales model.
What unmet needs do your customers have with products now that you're in closer contact with them?
One industry sage shared, "Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future."
These questions may seem monumental - and they are. But addressing them lays the groundwork for a HaaS model that benefits you and, most importantly, your customers.
But here's the million-dollar question: Does your customer want to buy this way? Does this model help reduce your cost of acquisition? Does it unlock a completely new market? Perhaps in some instances, customers are already asking for this model that you don't currently provide. In other cases, we've seen companies advertise their HaaS to test its performance against a sales model.
What unmet needs do your customers have with products now that you're in closer contact with them?
One industry sage shared, "Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future."
These questions may seem monumental - and they are. But addressing them lays the groundwork for a HaaS model that benefits you and, most importantly, your customers.
But here's the million-dollar question: Does your customer want to buy this way? Does this model help reduce your cost of acquisition? Does it unlock a completely new market? Perhaps in some instances, customers are already asking for this model that you don't currently provide. In other cases, we've seen companies advertise their HaaS to test its performance against a sales model.
What unmet needs do your customers have with products now that you're in closer contact with them?
One industry sage shared, "Finding the right product fit for a circular business model is the launch pad for a smoother journey and scalable future."
These questions may seem monumental - and they are. But addressing them lays the groundwork for a HaaS model that benefits you and, most importantly, your customers.
Financial stability
"We’re not yet at the product market fit, so it’s not the right time for us to think about pricing strategy"
"We’re not yet at the product market fit, so it’s not the right time for us to think about pricing strategy"
"We’re not yet at the product market fit, so it’s not the right time for us to think about pricing strategy"
– Twist customer
The journey continues towards financial stability, once you've got the right model and product. This isn't a casual footnote; it's the bedrock of your business, ensuring you stay upright as you evolve and expand within the HaaS model.
The catch: HaaS companies need debt, and they find themselves navigating this tricky terrain where a whole new type of lending product is needed for scaling. It's not quite asset-backed lending, nor revenue-based finance, but somewhere in between.
If acquiring a lease were as simple as walking into a bank, Twist wouldn’t need to exist - so we're quite thankful for this complexity. So here's our guide to securing debt quickly and avoiding a fruitless back-and-forth with lenders.
The strategy? Set up a facility that you can draw from when necessary. It's about preparedness. Most facilities use an SPV structure, so it's wise to initiate this early.
To understand a lender's mindset, consider this: Firstly, they're thinking, "How can I ensure I won't lose any money?" Then it's "How much can I reasonably lend, and at what cost?"
Lenders adore metrics. To win them over, they'll need to see four key product metrics alongside their usual underwriting: Cashflows, Collateral, Carbon, and Circularity. And we've got you covered - we handle reporting on all four.
Financing innovative products can be challenging, primarily because they lack a historical trail. Here's where you'll need to be inventive to justify the collateral value of the assets. Perhaps by periodically selling off products to validate their value at each level of depreciation. Or using a specific monitored component, like a battery, to substantiate the value.
Here's a cautionary tale: One of our clients looked financially robust on paper but hit a snag. The company only talked to one major customer about their interest in HaaS and created a custom pricing model for that customer. They failed to consider how this single point of failure would be viewed by financial partners and the potential impact of offering a heavily discounted model to win the contract. Meaning they wouldn’t be able to get financing without committing to this for more of their customers.
The journey continues towards financial stability, once you've got the right model and product. This isn't a casual footnote; it's the bedrock of your business, ensuring you stay upright as you evolve and expand within the HaaS model.
The catch: HaaS companies need debt, and they find themselves navigating this tricky terrain where a whole new type of lending product is needed for scaling. It's not quite asset-backed lending, nor revenue-based finance, but somewhere in between.
If acquiring a lease were as simple as walking into a bank, Twist wouldn’t need to exist - so we're quite thankful for this complexity. So here's our guide to securing debt quickly and avoiding a fruitless back-and-forth with lenders.
The strategy? Set up a facility that you can draw from when necessary. It's about preparedness. Most facilities use an SPV structure, so it's wise to initiate this early.
To understand a lender's mindset, consider this: Firstly, they're thinking, "How can I ensure I won't lose any money?" Then it's "How much can I reasonably lend, and at what cost?"
Lenders adore metrics. To win them over, they'll need to see four key product metrics alongside their usual underwriting: Cashflows, Collateral, Carbon, and Circularity. And we've got you covered - we handle reporting on all four.
Financing innovative products can be challenging, primarily because they lack a historical trail. Here's where you'll need to be inventive to justify the collateral value of the assets. Perhaps by periodically selling off products to validate their value at each level of depreciation. Or using a specific monitored component, like a battery, to substantiate the value.
Here's a cautionary tale: One of our clients looked financially robust on paper but hit a snag. The company only talked to one major customer about their interest in HaaS and created a custom pricing model for that customer. They failed to consider how this single point of failure would be viewed by financial partners and the potential impact of offering a heavily discounted model to win the contract. Meaning they wouldn’t be able to get financing without committing to this for more of their customers.
The journey continues towards financial stability, once you've got the right model and product. This isn't a casual footnote; it's the bedrock of your business, ensuring you stay upright as you evolve and expand within the HaaS model.
The catch: HaaS companies need debt, and they find themselves navigating this tricky terrain where a whole new type of lending product is needed for scaling. It's not quite asset-backed lending, nor revenue-based finance, but somewhere in between.
If acquiring a lease were as simple as walking into a bank, Twist wouldn’t need to exist - so we're quite thankful for this complexity. So here's our guide to securing debt quickly and avoiding a fruitless back-and-forth with lenders.
The strategy? Set up a facility that you can draw from when necessary. It's about preparedness. Most facilities use an SPV structure, so it's wise to initiate this early.
To understand a lender's mindset, consider this: Firstly, they're thinking, "How can I ensure I won't lose any money?" Then it's "How much can I reasonably lend, and at what cost?"
Lenders adore metrics. To win them over, they'll need to see four key product metrics alongside their usual underwriting: Cashflows, Collateral, Carbon, and Circularity. And we've got you covered - we handle reporting on all four.
Financing innovative products can be challenging, primarily because they lack a historical trail. Here's where you'll need to be inventive to justify the collateral value of the assets. Perhaps by periodically selling off products to validate their value at each level of depreciation. Or using a specific monitored component, like a battery, to substantiate the value.
Here's a cautionary tale: One of our clients looked financially robust on paper but hit a snag. The company only talked to one major customer about their interest in HaaS and created a custom pricing model for that customer. They failed to consider how this single point of failure would be viewed by financial partners and the potential impact of offering a heavily discounted model to win the contract. Meaning they wouldn’t be able to get financing without committing to this for more of their customers.
Product Performance & Operations Optimisation
Alright, folks. Your model's in place, your finances are robust, and now it's time for your product to sing and your operations to run as smooth as butter.
Product performance is no child's play. Think durability. Picture minimal servicing overheads. Resource efficiency. What does this spell? It's long tail cash flows, software-like margins, and a soft murmur rather than a bellow at Mother Earth. That, my friend, is the sweet spot.
As your business bulks up, so should your operational efficiency. The trick is in striking the right balance between the cost and value of your work, akin to a tightrope walker, always adjusting to prevent a fall. Each servicing cycle adds to your costs but also delivers a more delightful experience to your customers. Think about how this interplays with your SLA.
Alright, folks. Your model's in place, your finances are robust, and now it's time for your product to sing and your operations to run as smooth as butter.
Product performance is no child's play. Think durability. Picture minimal servicing overheads. Resource efficiency. What does this spell? It's long tail cash flows, software-like margins, and a soft murmur rather than a bellow at Mother Earth. That, my friend, is the sweet spot.
As your business bulks up, so should your operational efficiency. The trick is in striking the right balance between the cost and value of your work, akin to a tightrope walker, always adjusting to prevent a fall. Each servicing cycle adds to your costs but also delivers a more delightful experience to your customers. Think about how this interplays with your SLA.
Alright, folks. Your model's in place, your finances are robust, and now it's time for your product to sing and your operations to run as smooth as butter.
Product performance is no child's play. Think durability. Picture minimal servicing overheads. Resource efficiency. What does this spell? It's long tail cash flows, software-like margins, and a soft murmur rather than a bellow at Mother Earth. That, my friend, is the sweet spot.
As your business bulks up, so should your operational efficiency. The trick is in striking the right balance between the cost and value of your work, akin to a tightrope walker, always adjusting to prevent a fall. Each servicing cycle adds to your costs but also delivers a more delightful experience to your customers. Think about how this interplays with your SLA.
Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires.
Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires.
Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires.
To ace this, adopt a dual mindset: one eye on the present, the other scanning the horizon. Perhaps shifting to removable, swappable batteries is a move for the long game. But in the short run, focus on how your product caters to your users' needs to make operational or model changes that can cut costs and boost revenue.
An experienced HaaS player shared, "Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires." That's a nugget of wisdom to cherish in your playbook.
To ace this, adopt a dual mindset: one eye on the present, the other scanning the horizon. Perhaps shifting to removable, swappable batteries is a move for the long game. But in the short run, focus on how your product caters to your users' needs to make operational or model changes that can cut costs and boost revenue.
An experienced HaaS player shared, "Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires." That's a nugget of wisdom to cherish in your playbook.
To ace this, adopt a dual mindset: one eye on the present, the other scanning the horizon. Perhaps shifting to removable, swappable batteries is a move for the long game. But in the short run, focus on how your product caters to your users' needs to make operational or model changes that can cut costs and boost revenue.
An experienced HaaS player shared, "Product performance isn't just about impressive tech specs; it's about how the product nestles comfortably in the circular ecosystem and keeps pace with customers' ever-changing desires." That's a nugget of wisdom to cherish in your playbook.
Your HaaS journey with Twist
Your HaaS journey with Twist
Your HaaS journey with Twist
Moving through the hierarchy is not as clear-cut as going one layer at a time. Sometimes, depending on where you are in your journey, you’ll need to slice differently to have a focus tailored to your stage. The financial partners that you will be working with will also change dramatically - as you graduate up to a cheaper cost of capital. Here’s how we see it:
Moving through the hierarchy is not as clear-cut as going one layer at a time. Sometimes, depending on where you are in your journey, you’ll need to slice differently to have a focus tailored to your stage. The financial partners that you will be working with will also change dramatically - as you graduate up to a cheaper cost of capital. Here’s how we see it:
Moving through the hierarchy is not as clear-cut as going one layer at a time. Sometimes, depending on where you are in your journey, you’ll need to slice differently to have a focus tailored to your stage. The financial partners that you will be working with will also change dramatically - as you graduate up to a cheaper cost of capital. Here’s how we see it:
Small HaaS outfits
Small HaaS outfits
Small HaaS outfits
We're here to help you validate your model to yourself and a financial partner and align your processes and tools with your ambitions. The risk profile of the lenders you can work with here is going to be very different and so will the cost unless you have an existing bankable product. You’ll be working with venture debt providers and potentially angel investors in order to validate your model at this stage.
We're here to help you validate your model to yourself and a financial partner and align your processes and tools with your ambitions. The risk profile of the lenders you can work with here is going to be very different and so will the cost unless you have an existing bankable product. You’ll be working with venture debt providers and potentially angel investors in order to validate your model at this stage.
We're here to help you validate your model to yourself and a financial partner and align your processes and tools with your ambitions. The risk profile of the lenders you can work with here is going to be very different and so will the cost unless you have an existing bankable product. You’ll be working with venture debt providers and potentially angel investors in order to validate your model at this stage.
Medium-sized HaaS outfits
Medium-sized HaaS outfits
Medium-sized HaaS outfits
At this stage, we assist you in securing your first asset-backed facility, showcasing improved metrics, proving bankability, and beginning to lower the cost of capital. You’ll most likely be working with venture debt providers who may be able to offer something more structured at this point. Alternatively, if you have an environmental or scaling story to tell, banks can be a good partner at this stage.
At this stage, we assist you in securing your first asset-backed facility, showcasing improved metrics, proving bankability, and beginning to lower the cost of capital. You’ll most likely be working with venture debt providers who may be able to offer something more structured at this point. Alternatively, if you have an environmental or scaling story to tell, banks can be a good partner at this stage.
At this stage, we assist you in securing your first asset-backed facility, showcasing improved metrics, proving bankability, and beginning to lower the cost of capital. You’ll most likely be working with venture debt providers who may be able to offer something more structured at this point. Alternatively, if you have an environmental or scaling story to tell, banks can be a good partner at this stage.
Large HaaS outfits
Large HaaS outfits
Large HaaS outfits
We aim to reduce your cost of capital further, establish emissions reporting, refine operations, and more. At this point you should be working with a bank: they will be able to give you the cheapest cost of capital and facility sizes that fit your growth.
We aim to reduce your cost of capital further, establish emissions reporting, refine operations, and more. At this point you should be working with a bank: they will be able to give you the cheapest cost of capital and facility sizes that fit your growth.
We aim to reduce your cost of capital further, establish emissions reporting, refine operations, and more. At this point you should be working with a bank: they will be able to give you the cheapest cost of capital and facility sizes that fit your growth.
Remember, the journey to HaaS isn't a sprint; it's a marathon. Each phase shapes the success of your venture. As your companion on this journey, we can bring clarity, providing the right support at the right time. Let's conquer this thrilling journey together.
Remember, the journey to HaaS isn't a sprint; it's a marathon. Each phase shapes the success of your venture. As your companion on this journey, we can bring clarity, providing the right support at the right time. Let's conquer this thrilling journey together.
Remember, the journey to HaaS isn't a sprint; it's a marathon. Each phase shapes the success of your venture. As your companion on this journey, we can bring clarity, providing the right support at the right time. Let's conquer this thrilling journey together.