This model might be great if you have a successful and well-researched idea. But I'm concerned about validation, costs, and pivots.<p>What happens when your learnings pivot the app in a direction that [some] paid users aren't interested in? They have bought access to a service which might not align to their needs anymore and they likely wouldn't have access to the version which they paid for. Sure, a dollar is a small amount, but I feel as though the effect is more pronounced than with free services. Heck, free services get flack a lot of the time for changing strategy or shutting down.<p>I guess if your feedback and learnings are from the vocal majority, you might underestimate the backlash from the silent <i>real</i> majority.<p>Furthermore, what happens when you have 10 paid signups (let's say $10 total) for a service that needs $100 worth of infrastructure? Do you end the service and refund the money? Do you pocket the money and move on? Do you fork up the remaining infrastructure cost from your pocket and continue? I thought the value of kickstarter and the MVP model was the validation to support the product, whereas this model seems to have a grey area in that regard.
I really like this and I'm doing it with a new product we are building. We have existing customers on our main product and this new one is based on a survey of them. So, I think we have enough validation to do a paid beta.
I think in a kickstarter-like way, this could work. If you make your users feel like buying in early could benefit them in the long run, and that they get some say in how the product develops, I could see myself paying into a startup service I really felt like I needed.<p>Of course, it only takes a few of these to crash and burn, or completely not listen to their users and turn against them to make people lose trust in the whole model.
There is a valuation issue here - if you have # of customers x, price your product at y and make revenue z=x<i>y, your valuation in future seed rounds will somewhat become based on revenue z. If revenue z is not pivotal to your runway, you might be better off pitching to VCs that your revenue can be z'=x</i>y', where y' is your real value to customers. If y and y' differ by a significant factor (which the OP seems to be advocating), you can make a significant negative impact on your valuation as a company.<p>I don't see that charging customers a fraction of what they would pay in the future provides the benefits the article says: "It meets two pretty crucial components of a proper early stage startup: talk to users and write code." You can talk to free users and you will still be writing code.<p>"The minor revenue is not the prize. The fact that someone will pay you at all for some promised product is the prize." If you are providing real value for your beta customers, it will not be hard to determine that they would pay in the future.
I would consider my company, <a href="https://socialyzerhq.com" rel="nofollow">https://socialyzerhq.com</a>, to currently be in a paid beta period.<p>Our paying customers are amazing. They provide us awesome feedback and encourage us to keep going.
This sounds great on the surface but I'm always wondering about specific implementation of this method. How do you charge people for a promise? Do you set a certain timeline so people have something to look forward to?