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freemium model

Here's how this largely untapped business model works

1. Create a premium product

2. Create an inexpensive version or component of the premium product and offer it for free

3. Get loads of free users/customers in

4. Some free users convert to the premium product/version

Though this works best if the your product is digital or at least the marginal cost of servicing another customer is zero or almost.

Photo by Robert Linder

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