Not selling Basecamp by the seat

Basecamp co-founder, David Heinemeir Hansson, had a thoughtful post about why they chose not to sell Basecamp by the seat.

The problem with per-seat pricing is that it makes your biggest customers your best customers. With money comes influence, power and pressure. By maintaining a per-company pricing (regardless of size), no one customer’s demands would automatically rise to the top. So, they didn’t have to displease many to please a couple of large customers.

Second, they didn’t want to deal with the mechanics of chasing big contracts. They wanted to keep their company small and nimble. And, finally, this enabled them to build Basecamp for businesses like themselves – the “Fortune 5,000,000.”

John Shattock, the CEO of Beam, once said – “Values aren’t values until the cost you money.” Wikipedia is a classic example of this idea. They could easily become one of the biggest ad businesses on the planet. But, they choose not to.

Similarly, by clearly trading off large amounts of money for freedom, the Basecamp co-founders continue to demonstrate the simple, counter intuitive, and provocative approach to running a tech company that they’re famous for.

The problem with per-seat pricing is that it by definition makes your biggest customers your best customers. With money comes influence, if not outright power. And from that flows decisions about what and who to spend time on. There’s no way to be immune from such pressure once the money is flowing. The only fix is to cap the spigot. – DHH


Source and thanks to: Basecamp blog

(This story and quote is part of “The 200 words project.” I aim to synthesize a story from a book (and, occasionally a blog or article) I’ve read within 200 words consecutive Sundays for around 45 weeks of the year.)

2 thoughts on “Not selling Basecamp by the seat

  1. He’s spot on when he said “With money comes influence, if not outright power. And from that flows decisions about what and who to spend time on. There’s no way to be immune from such pressure once the money is flowing.”

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