I do for my team. As a small business that sells commercial software, I am totally not opposed to paying for good software.
I've been watching Fogbugz for a while. Our previous solution was Trac + Subversion for about 5 years and it served us very well. Before Fogbugz added Kiln there wasn't enough of an advantage to making a switch. The other factor that won me over was EBS.
We transitioned to a self-hosted FogBugz+Kiln install a couple months ago and I've been very happy with it, especially with the development velocity and very flawless upgrade process and customer support.
I do. Company I used to work for who I still contract with uses the hosted version. As an independent, I use the free hosted version for 'startups and students'. I think I can have up to two users, max.
We are a smallish group (50) in a very large company and we have been using fogbugz for a long while. We are currently transitioning our previous revision system into Kiln.
If anyone has any questions about Kiln or FogBugz, I'd be happy to answer them here. I'm glad to see so many positive comments though, especially about Kiln.
FogBugz has a Startup plan that is free for 2 users. And like other users said, why not pay for good software? If it saves each employee $30 of time, or makes each of our team $30 more productive, than it's worth it.
My team has been using FogBugz for over a year now. Huge improvement over the various systems I've used in the past. I never tried Redmine, but you couldn't get me to switch away from it now. FB8+Kiln is an amazing combo. Plus the upgrade from FB7 to 8 was painless.
I remember reading about it (did not actually used FB till this year) back then and it sounded interesting.
We are not using it and neither did the company I worked before. This feature would probably fit badly for the type the work we do now—most work is done in maintenance mode.
If anyone used EBS it would be interesting to hear about your thoughts about it.