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March 13, 2007
Startups and the Penny Gap
Great post from Josh Kopelman on startups and the "penny gap":The truth is, scaling from $5 to $50 million is not the toughest part of a new venture - it's getting your users to pay you anything at all. The biggest gap in any venture is that between a service that is free and one that costs a penny.Speaking of Josh, I like the following figure of his on the "new" cheaper funding cycle in online media companies:
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I should also clarify that you want to give away as much functionality for free as you can reasonably afford, or it won't be viral.