Give-It-Away Growth Engine
Reclassify free product and AI costs as marketing spend, then give the product away to your best distributors
- Difficulty
- Moderate
- Time to result
- ~months to results
- Steps
- 4
- Confidence
- 90%
A distribution strategy that treats generous free access — free tiers, credits, sponsored hackathons — as a marketing channel rather than a cost center to minimize. Especially counterintuitive for AI products where every interaction carries an LLM pass-through cost. Use it in new categories where nobody yet understands the value and the biggest barrier is getting people to try.
Origin
Elena calls giving product away 'part of our growth secret sauce' — a strategy she says she'd never applied before. Lovable tracks its LLM cost on free and giveaway usage as a marketing line item, not a margin drag to reduce.
Core principles
- 01The more mind-blowing the product, the more you should give it away
- 02Free-tier users who host hackathons do your marketing and activation for you
- 03Reclassify AI/LLM giveaway cost as marketing spend, not a cost center
- 04Giving away product is cheaper per eyeball than competing on paid ads or AdWords
How to run it
- 1
Remove the barrier of entry
Let people explore what the product can do for free — go beyond a freemium baseline so newcomers get the initial wow moment before any paywall.
Pro tip In a genuinely new category people don't even know what the product is; a written value prop won't convert them — a free first experience will.
Watch out Gating AI immediately behind a paywall to protect margins invites a competitor who gives it away to overtake you.
- 2
Say yes to every hackathon and event
When a user asks for free credits to run a hackathon at work, sponsor it fully. Ask 'how much do you need?' rather than gatekeeping.
Pro tip These users do the marketing and activating for you inside their own companies — never prevent them from using you.
- 3
Move the cost from margin line to marketing line
Track free/premium/giveaway LLM cost as marketing spend — something to invest MORE in — not a cost to cut to improve margins.
Watch out If you view AI costs as a cost center, you'll under-invest in the very thing driving your growth.
- 4
Convert trial into retention
Once people are hooked they are more likely to stay, so pair giveaways with a genuine retention strategy.
Watch out Giving it away only works if the product is good enough to retain the people you hook.
In the wild
When a user says they'll run a hackathon at work on Lovable and asks for free credits, Lovable responds 'take it. How much do you need?' and sponsors all participants.
→ The host does distribution, marketing, and activation inside their company for free.
Lovable spends little on paid marketing and sales (influencer marketing is only low-double-digit %), freeing budget to give product away. Cost per eyeball is lower than competing on Google.
→ Product-led growth 'to the max' without eroding the margin profile — spend is shifted, not added.
Common mistakes
Gating AI behind a paywall to protect margins
Traditional high-margin companies cut AI free access to protect their cushy profile — 'a knife through the butter' — and get overtaken by whoever gives it away.
Treating LLM cost as a cost center
Viewing every AI interaction as a cost to reduce, rather than flipping the script to expose value and remove monetization friction.
Is it for you?
Best for
AI or new-category products with mind-blowing demos and lower (~40%) margin profiles fighting for early adoption
Not ideal for
Mature commodity products with thin differentiation where free usage just cannibalizes revenue without driving word of mouth
From the transcript
“You have to remove the barrier of entry. You have to give a lot of your product away for free.”
“Why would we prevent a person who wants to do all of the marketing and activating for us from using us?”
“we uh basically track them over our LLM cost on premium and giveaways as our marketing costs and it doesn't go into our uh something…”
From the episode
The new AI growth playbook for 2026: How Lovable hit $200M ARR in one year
Elena Verna (Head of Growth)