What is freemium?
Freemium is a business model that combines a free tier of a product or service — accessible without payment — with paid premium tiers offering advanced features, higher usage limits, integrations or service levels. Freemium is widely used in SaaS (Dropbox, Slack, Zoom, Notion).
Freemium success depends on free-to-paid conversion rate (typically 1–5%), low marginal cost of free users, and feature gating that creates real upgrade incentive without alienating the free user base. Pricing-tier design and usage analytics are critical.