Insights — Channel Creation & New Revenue Streams — 3 min read
How Much Should You Invest in a New Sales Channel?
The right amount to spend on a new channel isn't a single number — it's a series of smaller numbers, each released once the last stage earns it.
In short
There is no fixed percentage or figure that applies to every business, but the right approach is staged investment: a small, defined amount to validate real demand, a larger amount to build the minimum working version once demand is confirmed, and full investment only once the channel has shown it can sustain itself commercially. Each stage should be sized to the risk, not the ambition.
Owners asking 'how much should we invest in this new channel?' are usually asking the wrong question first. The better question is: how do we structure the investment so it scales with evidence, rather than committing a large sum upfront on the strength of a good idea?
The businesses that get burned by new channels are rarely the ones with a bad concept — they're the ones that spent like the channel was already proven, before it was.
Why a single upfront number is the wrong frame
Asking 'what's the budget for this?' before any evidence exists invites a number based on enthusiasm, competitor comparison or what feels proportionate to the size of the business — none of which tell you whether the channel will work. A staged model replaces one big guess with several smaller, evidence-based decisions.
Stage 1: Validation spend
This is the smallest, cheapest test that can produce a genuine signal of demand — a basic landing page, a small paid campaign, a limited product run, or a short list of direct approaches. It should be small enough that failure is a non-event financially, and fast enough to get an answer within weeks rather than months.
Stage 2: Minimum viable build
Once validation shows real demand, the next stage funds the minimum working version of the channel — enough infrastructure, stock, process or capacity to serve early customers properly, without building for a scale that hasn't been earned yet. This is typically where a meaningful but still bounded budget is committed.
| Stage | Typical focus | Risk if skipped |
|---|---|---|
| Validation | Prove real demand exists | Build something nobody wants |
| Minimum viable build | Serve early customers properly, prove the economics | Overbuild infrastructure for demand that never arrives at scale |
| Scale investment | Fund growth once unit economics are known | Scale a channel that loses money per transaction |
Stage 3: Scale investment
Only once the minimum viable version has produced real transactions, and the unit economics — what it costs to acquire and serve a customer through this channel, against what they're worth — are known, does it make sense to commit the larger sums: dedicated headcount, marketing spend at volume, or significant infrastructure.
What 'worth it' actually means
A channel is worth continued investment when the cost of acquiring and serving a customer through it is comfortably below what that customer is worth over a reasonable period — not just when the channel is 'generating some sales'. Revenue without margin, or revenue that costs more to generate than it returns, isn't a reason to keep investing.
- Size each stage of investment to the risk being tested, not the ambition of the project.
- Set a clear bar to clear before moving from one stage's budget to the next.
- Know your cost to acquire and serve a customer in the new channel before scaling spend.
- Be willing to stop after any stage if the evidence doesn't support continuing.
This staged approach is built into how the Channel Creation Programme works — validating demand, building the minimum viable version and proving the economics, before any larger commitment is made. The programme runs from £1,995 + VAT/month over six months (from £11,970 + VAT at the starting price); larger builds are scoped individually once the shape of the channel is known.
Could your business support another route to revenue?
Evans Channel Creation identifies, validates and builds additional revenue channels from capabilities a business already has — B2B to D2C, D2C to B2B, product to service, recurring revenue or partners — and says so plainly when a channel should not be built. Programme from £1,995 + VAT per month over six months.
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