Agreed. There is this weird psychological trick where if you charge people more they start to value your service more or at least delude themselves into thinking so exactly because they are spending more money, it's a beautiful thing. If it fails, you can always reduce your price again!
>Never give your service away for free.*
* Except if your business model depends on capturing a large enough audience to feed them ads and generate revenue from that (Facebook, Google, Reddit).
A real life example: I am in search for an api doc solution for my SaaS. A certain "docs" SaaS costs about $1200/year for their basic service, which includes an ad for their service at the bottom of your doc pages. To not have their branding ("white label") costs $4800/yr. That SaaS is certainly taking the "charge more" advice to heart and because of it I will never try their service, and instead am trying open source solutions like docusaurus.
I agree 100% with this statement. The first startup I was involved with decided to give the product away for free to build an audience, and then attempt to monetize the audience.
The "business" felt more like a "hobby" and our users were not helpful because they had no investment whatsoever in the product.
- No.
- Why?
- It's candy, and we're not here to buy candy.
[...]
- Why?
- [Sigh] Because mum said so, and I promised her not to buy you any.
- But mum doesn't need to know, does she?