Freemium Plan Design by Motivations for Motion
Design plans by mapping what drives someone to move up a tier — and measure product-driven revenue.
- Difficulty
- Advanced
- Time to result
- ~months to results
- Steps
- 6
- Confidence
- 91%
Williams' approach to the perennial freemium question of what goes free versus paid. Every plan, free to top, needs a defined target customer and use cases, and — critically — you must map the motivations for motion between each plan: exactly what drives someone to step up. Gate things by three tests: does it add friction to the growth model (keep it free if it fuels loops), is it cost-prohibitive at free volume, and does it serve a need that only appears at the next tier (governance, compliance, business-critical code). Trials are treated as a permanently open question, and the whole system is measured through 'product driven revenue'.
Origin
Ben Williams (VP of Product, Snyk). He explicitly builds on Elena Verna's guidance (from a prior Lenny's Podcast episode) that things which fuel your growth model belong in free and things that add friction belong behind the paywall, and cites Fareed Mosavat's principle to focus on the user's path to value rather than on monetization.
Core principles
- 01Focus on the user's path to value, not on monetization — the latter follows.
- 02Anything that fuels the growth model belongs in free; friction belongs in paid.
- 03Cost of service is a legitimate paywall criterion at volume (Heroku killed its free plan over exactly this).
- 04Every plan needs a named target customer and use cases — including the free one.
- 05The upgrade trigger must be explicit, not hoped for.
- 06Never assume the model that fit in the past fits now.
How to run it
- 1
Define a target customer and use cases for every plan
From free to the top tier, each plan should have a well-defined understanding of who it is for and what they're doing with it.
- 2
Map the motivations for motion between plans
Be really clear about the drivers for someone to take a step from one plan to the next. For Snyk, the real driver from free to paid is wanting to secure business-critical code and developing needs around governance and compliance.
Pro tip Write the driver as a change in the customer's situation, not as a feature they lack.
Watch out If you cannot name the driver, the paywall is arbitrary and will suppress conversion and adoption at once.
- 3
Apply the three gating tests
Keep in free anything that promotes the growth model; put behind the paywall anything that adds friction to it, anything cost-prohibitive to serve at free volume, and anything that maps to a next-tier motivation (governance, reporting, robust user management).
Pro tip Cost of service was the entire reason Heroku cited for removing its free plan.
- 4
Treat the trial model as a live hypothesis
Snyk runs a self-serve trial for time-boxed evaluation of paid capabilities, but revisits the model periodically. Ask: what if the trial were limited by a usage dimension instead of time? What if there were no trial at all, and more in the free plan with appropriate limits? How would each change the growth model?
Pro tip Companies of different sizes, complexities and regulatory burdens need different lengths of time to evaluate properly — consider dynamic or usage-based trial lengths.
Watch out The trap is assuming what was the best fit in the past is the best fit now and in the future.
- 5
Test plan changes with cohorts, not opinions
Example experiment: cohort the trial users and teams with low engagement who don't convert during the trial, then when the trial ends drop them into a new enhanced free plan and monitor engagement there.
- 6
Measure product driven revenue across both motions
Track all revenue from customers where you saw meaningful value-based activity in the product before there was any sales contact. This tells the PLG-efficiency story across both self-serve and sales-led channels — and reveals what the freemium motion actually contributes at macro level.
Pro tip Design plans for the PLG motion AND the sales-led motion together — a strong PLG foundation inclusive of product-led sales gives you a large volume of highly qualified, product-sourced leads.
Watch out Know what you are optimizing for: revenue today versus potential future revenue.
In the wild
Snyk tracks revenue from customers who showed meaningful value-based activity in the product before any sales contact, letting them compare the health of product-sourced accounts against traditionally sourced ones.
→ The product-driven cohort contributes a relatively greater amount to net retention — a finding that reframes the freemium motion as a net-revenue-retention lever, not just a lead source.
With a valuable product, strong developer growth and strong retention in place, Snyk's first self-serve monetization efforts still only landed individual developers paying around $100/month; purchases in larger companies didn't happen. The team dug into the constraints and found they had to build table-stakes governance features (reporting, robust user management) and abandon the depth-first single-ecosystem approach, because security teams were accountable for an entire application estate.
→ Once those governance features and additional language/ecosystem support shipped — alongside the first sales and marketing hires — the business unlocked into what Williams calls 'rocket ship time'.
Common mistakes
Gating something that fuels a growth loop
Anything that promotes your growth model belongs in free. Snyk deliberately left its security education content entirely un-paywalled and signup-free precisely because it powers a company-distributed content loop.
Assuming a fixed trial length fits every buyer
Companies of different sizes, complexities and regulatory environments need different amounts of time to evaluate. A single fixed trial window under-serves the enterprise evaluators most worth converting.
Freezing the packaging model
There is no perfect or even correct answer, and it differs by product. Failing to periodically re-challenge the delineations between plans and the evaluation mechanism means quietly optimizing for a customer you no longer have.
Is it for you?
Best for
PLG product and growth leaders at B2B companies with both a self-serve motion and a sales-led motion who need to decide what to gate and how to prove freemium's contribution.
Not ideal for
Pure enterprise sales-led businesses with no free tier, or pre-PMF products where retention has not yet been established.
From the transcript
“you're really clear about what are the drivers for someone to take a step from one plan to it to the next”
“the real drivers to move from free to a paid plan for example is when you want to secure business critical code and you start…”
“in customers where we saw meaningful value-based activity in the product before there was any sales contact and that really tells actually a super interesting…”
“it's important I think to regularly challenge yourselves to ensure you don't fall into the Trap of Simply assuming what was best fit in the…”
From the episode
How Snyk built a product-led growth juggernaut
Ben Williams (VP of Product at Snyk)