The 3 conditions of a great freemium business

  1. The free product is compelling.
  2. Users of the free product inevitably bump into constraints as their usage grows.
  3. The constraints are removed by paying for a subscription.

Perhaps this is obvious, but in What do failed startups have in common? Erin Griffith writes:

Founders don’t ask themselves who is going to pay money for the product. “We see lots of freemium strategies,” he [Steve Hogan of TechRX] said. “Freemium is freemicide. Getting someone to upgrade from a service that is adequate and free never works.”

Adequate and free = users don’t bump into constraints as their usage grows, so they never pay.

3 thoughts on “The 3 conditions of a great freemium business

  1. Pingback: The 3 conditions that create virality | A Founder's Notebook

  2. Pingback: Weekly Round-up: 04/19/2014: Freemium, Effective Design, And Industry Numbers - Lattice Labs Blog

  3. Pingback: With freemium, you know you’re solving a customer’s problem | A Founder's Notebook

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