I am checking into different payment models and want to start one for my SAAS business. It's not straightforward as it sounds, even though I have learned from YC Startup School that only paid customers matter. But in a world where softwares are all over the place, how many people would like to pay a software without even trying it, for free ?!
Here are some models that I know a SAAS company usually does (based on researches and discussions):
1. Freemium (for ever) + Paid plan with more functionalities -> This one was quite popular 5-10 years ago. But I heard a lot of founders saying that SAAS should not do freemium, especially at the beginning. Because only paid customers matter and only paid customers confirm that your product is needed - the product market fit.
2. 7-14 days free trial then paid plan + Credit card required -> Personally I hate companies requiring credit card for a free trial. I heard that this can result a hight churn rate as well. Benefit: It may get extra revenue because some users forgot to cancel their accounts.
3. 7-14 free trial then paid plan + credit card not required. Need some more insights about this one. It seems to be the best option so far.
After writing this down, I think I should just take one model, try it out, and iterate...Does it really matter the initial choice?
1. Freemium (for ever) + Paid plan with more functionalities -> This one was quite popular 5-10 years ago. But I heard a lot of founders saying that SAAS should not do freemium, especially at the beginning. Because only paid customers matter and only paid customers confirm that your product is needed - the product market fit.
2. 7-14 days free trial then paid plan + Credit card required -> Personally I hate companies requiring credit card for a free trial. I heard that this can result a hight churn rate as well. Benefit: It may get extra revenue because some users forgot to cancel their accounts.
3. 7-14 free trial then paid plan + credit card not required. Need some more insights about this one. It seems to be the best option so far.
After writing this down, I think I should just take one model, try it out, and iterate...Does it really matter the initial choice?