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Comment by gdevore | Hacker News Reader

I agree with points 2 and 3 but point #1 is a big stretch. Drop that and people will take the article more seriously.

Chargify isn't blaming their customers for incorrect assumptions, but their customers are feeling the effects of their incorrect assumptions.

With the way things are now at Chargify it costs more to maintain/support a current customer than that customer generates in revenue. You can afford to grandfather old accounts if you can still at least break even on those accounts. If you can't then you have to do something like what Chargify did or your business will cease to exist. The key is to do all that you can to not put yourself in the position that your support costs are so high that you can't be profitable on existing customers.

I blogged more about it here:

http://www.bluemangolearning.com/blog/2010/10/building-scala...

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> You can afford to grandfather old accounts if you can still at least break even on those accounts.

They could have grandfathered the existing accounts for at least 6 months or so, but giving any user -- whether a paying customer or a free user -- only 30 days to start paying $100 a month when many of them expected to be paying little or nothing for quite some time? Well, I think that is the height of arrogance and disrespect for the customers on which your business is built -- and an exceptionally effective way to alienate all those free users who MIGHT have become paying customers if only they had been given a reasonable amount of time to adjust to the change ... or even a reasonable new rate for small volume users.

Why not offer something like $5 a month for up to 10 subscribers instead of basically kicking all their free users in the groin? Most small businesses would not bat an eye at such a small charge even if they had only 30 days to start paying or abandon Chargify. But did they offer such a service?

No, the fact remains that the guys at Chargify appear to be way too naive for any serious business to trust or rely on them at this stage of the game. They didn't "get it" when they made their blunder and from what I have seen they still don't "get it".

But no worries, there are others that will pick up the slack ...

Are they users or customers?

You cannot alienate customers that are not your potential customers.

The beauty of this service and the United States is that nobody is forcing you to use Chargify. Also, if you do use Chargify, you can stop at any time, without any penalty.

In fact, Chargify uses an API, so your application can be written in a way that competing and alternate services can be integrated into your application (without requiring major rewrites to your application).

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