Does the SaaS model really work?  Really?
grahamr: As others have mentioned, the key distinction is whether you're targeting individuals or businesses.Typically you'll have a tough time convincing individuals to part with $20 per month and typically there's a free alternative.It's much easier to convince businesses to spend the same amount and, as a bonus, many will be suspicious of free offerings. In fact, others will subscript to a higher premium tier purely to "buy the best for my business."I always refer people to this StartupSchool talk by DHH of 37signals which outlines their business model, and explains their focus on small businesses:
http://www.omnisio.com/startupschool08/david-heinemeier-hans...