An AI website builder · B2C · company the guest knows
Make free users pay before they can fix their buggy first build
Frustrated users complained publicly on Twitter
What they did
What happened
In their words
How a Single Paywall Experiment Generated $50M – Jeff Morris, Chapter One, Ex-Tinder
David Barnard… subscriptions, you might not really understand just how bad your retention is until 12 months later. And there's hints of it. You can look at auto-renew status and stuff like that. But any kind of additional advice or thoughts on who should be trying that freemium model first versus maybe the apps that do work better with that flipped on its head, monetization, engagement, retention, which seems like most apps are kind of doing that today.
Jeff MorrisIt very much depends on the category. If I was building an app today, I'd probably build more premium experiences that don't sacrifice product quality if you were to monetize. So example being like there's a website builder I know well, they're more of an earlier stage company and it's a really popular product within its segment, but the challenge they had with Freemium was just users ... So if you build a website, whether it's on a Level or Bolt, you obviously have a fair amount of debugging that you have to do within any product that you create. And they actually couldn't afford to let their freemium users debug the initial builds. And so if you look at Twitter for that product, people were really frustrated because they would have some idea, they'd prompt the app, and then it would be buggy, and then they'd be pushed into some subscription to make that happen.
Jeff MorrisThere's not a payoff of a successful outcome before you're asking people to open up their credit cards. So I think for something like that, I would probably just say, hey, we want everybody who pays for the product to really have full access to the best working version of our product. And so you're kind of getting people who are trying to monetize before they have that magic moment with their customers, which like at Tinder, you wait for somebody …
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More from this episode
- Put a toggle in the top bar that opens a new paid tierAbout $50M in revenue from one small A/B test
- Limit free swipes per day and charge for moreStopped mass-swiping and auto-swipers; turned into a strong revenue driver (no numbers)
- Give each paid feature its own paywall and check its sales every morningShowed 2-3 features drive most new subs; weak ones were made free
- Offer several paid tiers, from cheap starter to big spenders at $50K a yearGuest's biggest revenue unlock at Tinder; no numbers given
- Set different prices by country, starting with fast-growing markets like India
- Polish the paywall like a core feature, e.g. add a gold shimmerGuest says it showed users they cared; no numbers
- Ask for payment only after a user gets a match and starts chatting
- Build engagement and retention first; push monetization only years laterReached 30-40M monthly users before revenue became a focus in years 4-5
- Create a revenue team with its own iOS and Android engineersGrew from 6 engineers in 2016 to 40+
- Give the first flight free with every pro feature, then lock some
- Ship a new feature every single dayBecame the default database for most major website builders
Tags: freemium, paywall-timing, ai-costs