Lifetime deals are fine and you are all cowards

I ran a lifetime deal for Fjordmail in September. $149 once, forever. 212 people bought it. That is $31,588 in three weeks, which is more than the product made in its first year of subscriptions.

Every thread here treats lifetime deals as a moral failure. I think most of you are repeating something you read and have never run the numbers on your own product.

My numbers: those 212 accounts cost me about $0.90 a month each to serve. At that rate the deal pays for itself for 13 years.

Tell me why I am wrong. Bring numbers.

Gladly.

$0.90 a month is your infrastructure cost today. What is the support cost? Lifetime buyers file more tickets per account than subscribers in every dataset I have seen, including mine from a client engagement in 2022: 2.4 times more.

Second, you have sold 212 people a claim on every feature you will ever build, priced at what the product was worth in September.

Third, and the real one: what did it do to your subscription signups the month after?

Support: 31 tickets from 212 accounts in two months. Fine, that is higher than subscribers.

Subscription signups in October: down 40%. But I attribute that to seasonality.

You attribute a 40% drop in the month after you told the whole market the product was worth $149 forever to seasonality.

I'll give you the old man's version.

I did a lifetime licence in 2004. Called it a "perpetual licence" because that's what we called them. $499. Sold about three hundred. I was still answering email from those accounts in 2016, twelve years later, and several of them were furious that the product had changed.

A lifetime deal isn't a sale. It's a marriage with no prenup.

A marriage that paid $31k up front, Walt.

So did my first one. Ask me how that went.

real question not a dunk: what did you do with the 31k? if it bought you six months to build the thing that gets you to sustainable mrr then it was a loan from your customers at a decent rate. if it went on rent then nadia's right

It paid for a contractor to build the warm-up feature, which is now the main reason people subscribe. So, the first one.

then it was financing. fine. just call it that

I have cohort data for this. Staywise had 14 customers who ran lifetime deals last year, and I can see their subscriber churn before and after.

In 11 of 14, subscriber churn went up in the three months after the deal, median increase 1.8 points. The pattern in the cancellation notes is: "I will wait for the next lifetime deal."

You do not only sell a cheap product once. You teach the market to wait.

Fine. That is the first argument in this thread I had not considered. That one lands.

I think they are okay for mobile apps though?? A lot of people really hate subscriptions for small apps and a one-time unlock makes them happy!!

A one-time unlock for a fixed feature set is a product. A lifetime deal on a service you must run forever is a liability. Those are different things and I will accept the first.

NADIA AGREED WITH ME. Somebody write down the date!!

I have nothing to add about lifetime deals. I only want to say that this is the most replies a thread has had since mine, and in mine I destroyed a database. Gus has achieved it with only an opinion.

Buyer's view. When I look at a company to acquire, lifetime accounts are a line I subtract from the price. Not at face value: I estimate ten years of service cost per account and take that off. On the last deal I passed on, lifetime users were 30% of the active base and it took the offer down by a quarter. The founder was surprised. He should not have been.

That is a real cost and I had not priced it. All right.

Position after 16 replies: lifetime deals are financing, they are expensive financing, and I would do mine again but only once and I would cap it at 100.

I can live with that sentence. I would like it noted that it is not the sentence in your title.

The title stays. The title is why you all came.