DHH represents the other side perfectly here: http://www.youtube.com/watch?v=0CDXJ6bMkMY
I think that's an important question that potential startup founders need to answer before diving in. $20k/month coming in from a lifestyle business sounds less stressful than being CEO of a startup with a billion dollar valuation.
It is also a lot more likely.
It's not really about just being a lifestyle business though. The point is that there is so much opportunity out there right now that you can just be a few people, with no outside capital and make way more than $20k/mo. I would think followgen was one example of that. I'd be surprised if they weren't doing way more than $20k by the time they shut down the v1 service.
Even if you want to go it alone, this guy is going to making way more than $20k a month soon, if I guess right: https://www.baremetrics.io/
The business has only been operating for 4 months..and has been profitable from day one.
Although this was successful from day one, it was a result of 2 or 3 pivots over 3 years. All of the failures and successes from those pivots were fine-tuned and put into the current company.
Having a SaaS product with monthly subscriptions would be my ideal, but you gotta know what people want and will pay for and how to find them.
Then, you are entering a market where people already pay for stuff, and they can hopefully understand why yours is better. If you get their attention, you have a good chance of starting to build a subscriber base.
Being unique and new is great, but it's a incredibly tough way to get off the ground.