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Pricing and running AI products

Should an AI product have a free tier?

Cal Renshaw, , 2 minute read

No. A free tier on anything with a meter means paying the model for people who haven't paid you, every month, with no idea how many there'll be. You can do the sum for paying customers. A free tier has no price to divide by, so there's no sum at all.

The free page

I once built a page in an evening that turned an official letter into plain English. No sign-up, no payment, no plans for it. I posted the link as a reply in a forum. A handful of people used it, and I forgot about it.

The account had a spending alert, because that was the setting the provider put in front of me. I'd meant to switch on a hard cap, the setting that stops spending rather than reporting it. (Everybody means to switch one on.) One Friday a link to the page appeared on a much busier site. The email arrived at 3:40 in the morning, with the word "threshold" in its subject line.

Nothing free should call a model. Every key that does needs a hard cap you've watched fire.

What I offer instead

In my document product's second month, a woman asked for a free tier so she could try it before paying. I offered to take her last month's documents, run them through the product myself, once, and send her the spreadsheet it made. Her documents, her month, the real thing.

It cost me less than a coffee in model fees and about an hour, mostly checking the result. She subscribed the next week. I've done it for a handful of people since: always one month, always by hand, always checked.

3 better ways to let people try

  • Saved examples. Real outputs from real inputs, shown on the page, costing nothing per visitor.
  • A sample by hand. Run one batch of their own work yourself, and send them the result.
  • Money back. Charge from day 1 and promise a refund if it doesn't do the job.

Who Pays for the AI? has the free page and what it taught me.

Questions

Is a free tier worth it for an AI SaaS?
Not on anything with a meter. Every free user is a running cost with no price against it.
How do people try an AI product without a free tier?
Show saved examples, run a sample of their own work by hand, or offer their money back.
What is a hard cap on an AI API key?
A setting that stops spending at a limit, as against an alert that only tells you. Switch it on and watch it fire.