1396: Product Tranquility: The Brutal Truth About Freemium Models That Kill B2B Software Startups with Chief Pricing Officer Dan Balcauski

Friday, August 8, 2025

A lot of SaaS founders start with freemium because it feels like the easiest way to get users in the door—but then those users never really convert. You end up with a bloated free tier, server costs piling up, and barely enough paying customers to keep things going. It’s like giving away your best stuff and hoping someone eventually offers to pay for it. And the worst part is, by the time you realize what’s happening, it’s already eating into your runway.

Dan Balcauski, founder and Chief Pricing Officer of Product Tranquility, helps B2B SaaS companies fine-tune pricing to drive real growth. Today, he explains why freemium often fails in B2B, especially when customer value isn’t clearly defined. He shares how subscription models have matured and why pricing needs to reflect what users actually care about. His focus: use value-based metrics to build smarter, more profitable product strategies. Stay tuned!

Quotes:

“If you don't really understand how you're charging customers or haven't thought it through well, you're missing the highest leverage opportunities.”

“I would spend most of my time on what the price tag goes on, and little time on what number goes on the price tag.”

“Value, like beauty, is in the eye of the beholder. We need to understand it's not what we think; it's what those customers think, whom we're actually trying to sell this to.”