Startup Funding Espresso -- Freemium
Freemium Hello, this is Hall T. Martin with the Startup Funding Espresso -- your daily shot of startup funding and investing. Freemium is a key business model in the startup world. It\u2019s a pricing strategy that provides a product or service for free in order to attract more users.\xa0\xa0 After the user is engaged with the product, the company can upsell the user for paid services.\xa0 The freemium strategy is highly scalable as it can capture new users without the use of a direct sales force.\xa0\xa0 The strategy works well with software products because the incremental cost of adding another user is near zero. The key to a freemium model is the ability to upsell the user into a paid product. Therefore, the premium features must be compelling.\xa0 One can create a freemium product by taking the company\u2019s main product and limiting its usage, reducing the features available, or limiting the support the user receives. There are many ways to monetize a group of users. Consider the following: Premium services provide additional functionality but at a price. The content, data, and identity of the users can be monetized. Companies that sell to the same user base would pay to access those users through advertising or direct marketing. It\u2019s important to have premium features to upsell to. Finally, the product must be \u2018sticky\u2019 by capturing key information from the user so it\u2019s harder to switch to a competitor product.\xa0 \xa0 Thank you for joining us for the Startup Funding Espresso where we help startups and investors connect for funding.Let\u2019s go startup something today. _______________________________________________________ For more episodes from Investor Connect, please visit the site at: \xa0 Check out our other podcasts here: \xa0 For Investors check out: \xa0 For Startups check out: \xa0 For eGuides check out: \xa0 For upcoming Events, check out \xa0\xa0 For Feedback please contact info@tencapital.group\xa0\xa0\xa0 Please , share, and leave a review. Music courtesy of .