Summary
Sean discusses the pros and cons of the freemium model in B2B SaaS and why he prefers a free trial to a free tier. While the freemium model can help form a habit with users and has a low barrier to entry, it also comes with risks such as users not converting to paid plans and undermining the value of the product.

Key Points

• Freemium model creates a tiered system with free access and paid upgrades
• Freemium model helps form a habit with users, but also comes with risks
• Free trials offer a limited period of use before requiring payment
• Understanding activation points is crucial for setting up a successful freemium model
• Converting users from free to paid plans is difficult
• Freemium models can inadvertently devalue the product
• A free tier can be a safer option than a freemium model

Quotes

• "Getting them to switch from how they used to solve it to how they solve it with our product is harder than probably most of us think."
• "And the freemium can really help you do that with a very low barrier to entry for your users and customers."
• "It is insanely difficult to convert someone who is expecting a product to be free then to become a paid user of something."
• "That's why it's really difficult to start out with a free product and then at a later date try to monetize it."
• "Takeaway here is to better understand what a freemium model is and compare and contrast those differences with instead of free tier for gaining access to your B2B SaaS."
• "And also, in my personal opinion, why I don't love the freemium model, it's got limited application and I think too much risk and why I strongly prefer you to consider just offering a free tier instead."

Free Resources

• B2B SaaS Business Model: Ultimate Guide for 2023
• How to Build a Profitable AI-Powered B2B SaaS Business for Less Than $750

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Free Email Course

• How to Build a Profitable AI-Powered B2B SaaS Business for Less Than $750 - https://nxtstep.io/b2bsaas

Connect with Sean

• Subscribe to my YouTube Channel - https://www.youtube.com/@nxtstepsean
• Connect with me on LinkedIn - https://www.linkedin.com/in/sean-boyce/

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