the audacity of freemium,in the enterprise.

by Aaron Levie

who’s ready to talk about freemium?

what does box.net do?

we weren’t always ‘freemium’

those were the two most profitable months we’ve

ever had

“you’re crazy to give this away for free”

in 2005, an early investor said:

…and then he referenced pets.com

“think about the cost of storage, bandwidth, support, operations, and blah and blah and blah…”

he was right and wrong

he was already a billionaire, so it didn’t really matter

the times have changed

amazon s3, google, outsourcing, Ycombinator, and so on

a free trial is not enough

(unless you’re selling to the CIA)

fundamentally, happy customers will pay you

technology decisions are now being made by

users, not management

don’t put up a wall in front of them

here’s why you’d be crazy not to give out your software for free

lower friction = faster traction

hook them early and get their data

high marketing leverage

your users are your marketers

it forces you to make a much, much better product

you can’t just be larry ellison

sales will love you

only talk to people that want your product

reach traditionally impenetrable markets

your product will seep into new ecosystems

if they don’t want to pay, they don’t have to leave

only lose customers to yourself

just to be fair, a few reasons why freemium sucks

sales will hate you

for the same reason they love you

delayed gratification

some users take years to pay,most never at all

lower commitment

smaller barrier to entrymeans smaller barrier to exit

free = cheap & insecure

no one ever got fired for buying IBM

in conclusion

google wants to destroy you