A note from Daniel

This is a recurring theme across business models because of the Cold Start Problem. Charging customers directly is a straightforward way to generate revenue, but it adds friction for every new user to join the network. It's hard enough to build an atomic network; why make it even harder by erecting barriers? Without being able to build out a network quickly, growth channels like virality are more muted. If Zoom charged every user with no free tier, it might have generated more revenue in the short run, but would likely have needed to spend more on marketing and sales to compensate.

Daniel Cold Start Problem, page 108 · September 12, 2023 Save to shelf
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