Why we never sold Basecamp by the seat

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2021-09-08 10:30:05

Even before software as a service became a thing, it was pretty common to sell business applications on per-seat pricing. The bigger you are, the more you pay! At Basecamp, we rejected that model from day one, and have stuck to our guns for 13 years. Not because we don’t like money, but because we like our freedom more.

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.

So that’s what Jason and I decided to do from the start. We weren’t going to have clients, we were going to have customers. And lots of them. All pretty much equal in their contribution to the business. This would leave us with three key truths about the business:

First, since no one customer could pay us an outsized amount, no one customer’s demands for features or fixes or exceptions would automatically rise to the top. This left us free to make software for ourselves and on behalf of a broad base of customers, not at the behest of any single one. It’s a lot easier to do the right thing for the many when you don’t fear displeasing a few super customers could spell trouble.