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Comment by bryanh | Hacker News Reader

So, basically, that boils down to:

    I have a critical mass of paying users and I
    have to disappoint a small portion of them.

I hope I'm not misrepresenting your comment because on the spectrum of problems afflicting early stage startups, them's the good kind.

On a more serious note, we didn't have too much of a problem with it and we had to say "no" quite a few times. We'd just offer to refund their money and explain the situation the best we could.

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Yes but you're describing this as an alternative to the free beta/mvp model. With an equal number of hypothetical users, you're disappointing paying users, where the alternative is that they haven't paid (and I postulate that they would be less disappointed because of it!). Perhaps the free model could be a more positive experience for a brand, and have less frustrations on the customer service side.

I guess it's just another factor to consider. They both seem to be viable models. And I'm not experienced with either.

We actually found people who paid us to be much more helpful and understanding with potential issues. Probably because they knew we were working hard on solving a problem that they paid for. We also offered a money-back guarantee, but barely anyone ask for one (<1%). Customer service isn't bad since the volume for a paid beta isn't what you'd see for a free beta. This has the side affect of keeping your beta group contained so that you really get to know your users.

Free users were the opposite. They would be angry when things didn't work out quite right and complain about the beta price (roughly $5, though we moved it around some). Free also has more issues on the customer service side simply because you have to do more of it.

I can certainly think of scenarios where a free beta makes sense, but if I'm starting another B2B company I would charge from day one all over again.

Interesting observations. Thanks!

We've taken a similar approach to building Vidpresso, and it's worked out really well. We literally found one customer who'd pay up front for a year of our service, then they suffered through the woes of an early product. Then, we found our second customer who'd pay for our basic product, and then we started to scale out and launch more features.

I think for any product that results in a sale, ie not a social net or the like (not disparaging!), this is the right approach.

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