Introducing the “Less Than Free” Business Model

Harvard had Facebook before Zuckerberg came along. In the late 90s, graduates of Harvard Business School tried to sell the university their own version of Facebook. For Facebook, the university was the wrong customer. Building university requirements into a product and having a long sales cycle would never have allowed Facebook to exist. Bypassing them entirely was an ingenious move.

So, a subsidiary claim would be: pricing forces you to choose a customer. Choose well, and you have a fantastic product. Choose wrong, and you get stuck.

Have you chosen your customer carefully? Can you leverage a free or “less than free” business model to change the game on your competition? One of the most successful ways for small private companies to gain the upper hand over large incumbents is to change the rules of the game.

Alex Douzet is Co-Founder and COO of TheLadders. In this role, Alex is responsible for the company strategy, global business operations, and product development.

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