Pricing
Quick note: I will be in Bangalore for two weeks starting June 18th. If you're around and free to catch up (in person or virtually), hit me up!
Most consumer apps follow a freemium model. For Hobbes, I've decided on a paid monthly/yearly subscription with a 14-day free trial. Here's why.
I want to build one great product, not two. With freemium, I'd need to create both a compelling free experience and a paid upgrade worth converting to. As a startup, designing one excellent product is hard enough, let alone two. And if I make the free version deliberately limited, it will be a frustrating customer experience that hurts first impressions. The 14-day free trial with full functionality, hopefully, bridges the gap to a free product.
The business model alignment matters too. With freemium, I'd likely need ads for the free tier, which means designing around advertiser interests rather than user health. That feels particularly wrong for a wellness app where trust and privacy are crucial. With paid subscriptions, the relationship is simple: you pay, you get value, and no third parties are involved.
The economics are clearer. Typical health app conversion rates from free to paid hover around 1-2%. To get 10,000 paying customers, I'd need roughly a million downloads and a significant marketing spend. With a paid model, I need about 50,000 downloads (assuming 20% trial-to-paid conversion), giving me more control over marketing costs.
There's also a focus benefit. Paid users send clearer signals—engagement, feature usage, and churn patterns are easier to interpret when people have made an intentional investment. I can obsess over actual results rather than engagement tricks.
This approach does involve making conscious trade-offs. Growth will be slower, customer expectations higher, and I can't launch a throwaway MVP to test the market. It will be harder for me to brag ("We have 5 million users!") and raise funds.
For Hobbes, the goal is genuine behavior change. A paid model signals that we make money when you find genuine value, not when you look at ads or get hooked on notifications. That alignment feels right to me.
What do you think?