Freemium

A permanently free tier alongside paid plans, where the free tier drives adoption.

Example

Free for one project; paid for unlimited projects and team features.

Important

Freemium only works if free users cost you almost nothing and there is a clear moment where the free plan genuinely stops being enough.

Related terms

• Product-led growth (PLG) — Growth driven by people using the product itself — free tiers, trials, sharing — rather than by a sales team.
• Business model — How the company creates value and captures some of it as revenue.
• Pricing — What you charge, how you charge it, and how the tiers are structured.

Lessons that explain it

• Business models — Subscription, transaction, marketplace, usage, licence. The model shapes your margin, your sales motion and how much money you need. (12 min)

All 176 terms in the Founder glossary