In this talk, Slack Director of Product Fareed Mosavat will share his framework for building freemium business models.
You’ll learn the 5 criteria to determine if a freemium business model is right for your business:
1. Do you have access to lost cost acquisition channels?
If not, start by building an acquisition engine An acquisition engine requires a deep understanding of users: content, competition, cross-company virality
“Paid marketing & freemium are oil and water”
2. Is there a quick activation path?
If not, make onboarding a core priority. Free users require fast activation or else they’ll churn or remain dormant forever
“Free can attract the wrong users, activate the right ones ASAP”
3. Do you have internal growth loops?
If not, expand into multi-player features. Build features that enable collaboration, cross-team visibility and unlock value for managers.
“Teams are inherently collaborative, but we have to productize it.”
4. Is your core audience empowered to purchase?
If yes, remove as much friction as possible – Optimize your pricing page – Self-serve add-ons & upgrades (no sales rep needed!) If no, find ways to work around procurement and manager approvals”
5. Is there a clear value metric?
Determine your first value metric and create a conversion at this moment. Value should increase over time, but start you need to start somewhere! “Premium features are hard to anchor on!”
This talk was originally created for SaaS School, an invite-only program for entrepreneurs to learn from the fastest growing software companies like Airtable, Dropbox, Drift, Slack and more.