No, they wouldn't. They've run the numbers. What they figured out is the cost to acquire a paid user is cheaper by having a free account than by buying a bunch of ads.
Free plans or hobbyist plans are really there to get the marketing and cheap customer acquisition, not to power the mainline B2B business. The main business in both cases is likely bolstered by enterprise clients worth 5+ figures a year, but don't likely cost much more than a hobbyist account to maintain.
If you only had a hobbyist offering, you'd go out of business. As this post points out, Heroku has a much larger common offering where they should have plenty of profit at scale.
Meanwhile, they also benefit from hobbyists saying "oh yeah, Heroku is easy, let's use that!"
If you only had a hobbyist offering, you'd go out of business
This just isn't true. To mention WP Engine again, they were hobbyist-only at first. You had to contact them specifically to require an enterprise-grade plan.
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No, they wouldn't. They've run the numbers. What they figured out is the cost to acquire a paid user is cheaper by having a free account than by buying a bunch of ads.
Free plans or hobbyist plans are really there to get the marketing and cheap customer acquisition, not to power the mainline B2B business. The main business in both cases is likely bolstered by enterprise clients worth 5+ figures a year, but don't likely cost much more than a hobbyist account to maintain.
If you only had a hobbyist offering, you'd go out of business. As this post points out, Heroku has a much larger common offering where they should have plenty of profit at scale.
Meanwhile, they also benefit from hobbyists saying "oh yeah, Heroku is easy, let's use that!"
Heroku is smart, they know what they are doing.
This just isn't true. To mention WP Engine again, they were hobbyist-only at first. You had to contact them specifically to require an enterprise-grade plan.