Vikas Kansal · 7 min read · Product Strategy

Why SaaS freemium playbooks don’t work in AI, and what to do instead

Read the original on lennysnewsletter.com →

The article argues that traditional SaaS freemium playbooks fail for AI because every free action incurs costly compute and can cannibalize premium plans. To monetize sustainably, AI products must deliver enough magic to reach the aha moment while balancing costs, and gating core capabilities often backfires. It offers a framework for a modern AI paywall that weighs what users expect against compute expenses, enabling instant value while protecting long term growth.

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