If you charge for your app, service or content before the customer has received it, you have fewer customers as each one of them is harder to acquire. That’s why many services offer to use them for free to a certain extent and only pay if you continue using them, which in reality usually requires limiting the free usage. The other big business model is the free-as-in-advertising model big companies like Google and Facebook are running on, it is free for you but your private data will be used and sold to others to advertise towards you. And especially for running network-structure businesses, where limiting the users always means limiting yourself, this sounds like the only do-able solution. But a new payment model is on the rise promising fix this mistake: the free to pay business model.
In contrast to the free-as-in-advertising the free-to-pay business model offers to give that same value of running a social network but at the same time not having to sell out your information. Quite the opposite allowing them to lift up privacy as their most important feature other competitors are lacking. Here is how the mode works: in the free to pay business model you offer your service or software free of charge to anyone, who wants to use it. But other than too many other startups, you also allow users to pay for the service. The user is free to pay for the service - hence the name.
The premise behind that model is, that people indeed do understand that building and running something costs money and if they do like it, they are happy to keep it alive. So happy that they are spending money on just being allowed to continue using it and making sure it stays independent (aka no need to get bought by another company). And those, who don’t want to pay for it, well.. they won’t. But they’d pirate your software anyways. By just giving it to them for free you can get rid of that whole anti-piracy-department-and-legal-crap all-together and put that money towards improving and running the actual thing.
You still think it won’t work? Well, Wikipedia is doing it via asking their users for donations, Flattr is a webservice allowing readers to transfer money easily to the creator of a blog articles voluntarily after reading it and is even used by the german-wide newspaper Tageszeitung, the Open Source email client Geary is using crowdfunding to get off the ground and so do others and well, the Text Editor that got me started to think about it, Sublime Text is free to use but you can purchase a licence and then of course the great TED Talk by Amanda Palmer - they’ve all got this model working for them.
So, why shouldn’t it work for your community driven software or services then? And maybe, just maybe, then you are really interested to build something your users love to use and pay for.