[13ren]

My own experience is with software that was free for a year before my first sale (though I made it available for sale pretty much near the start). So I did do what you are thinking. But I developed it entirely in public: the first version (released) took me 2 hours to write. This approach was great for countering my perfectionism.

(1) Yes. You don't need a free version to sell stuff. But what does "leveraged" mean in your case? If it's a network effect, where your offer has no value unless there are already users (e.g. a dating site), you would need some way to build up users.

(2) All products are incompletely tested... it's an opportunity to show customer service... and version 2. There's a question of degree here of course. You're right, you do have a chance to try it out on free users - although bugs are just as annoying for them as for mium/fee customers. Maybe the way to think about it is: are they paying for the benefit you offer, or for the absence of bugs? People complain, but they still buy - because they know no-one is perfect. Provided you treat them with respect, they may even like you more because of it.

(3) People don't like it if you take something away, especially if they started to rely on it. It creates bad feeling. I think a free trial (time limited) will give you the info you need.

[samson]

I can relate to the perfectionism syndrome. But the release early, release often theme seems not a good counter while going at paying users. Sometimes that early release simply isn't worth paying for yet, it may take several iterations to get to something that is worth a package fee. I agree all products are incomplete both in testing and in functionality and that should be used to temper perfectionism.

Though there seems to me a difference between releasing early to get people to use it, and releasing to get people to pay for it. The release early and often theme I tend to think should not be broadly applied to both.

Perfectionism aside...thanks for answering my questions.

[13ren]

Sometimes that early release simply isn't worth paying for yet

If so, no one buys it - no problem :-) (assuming they can evaluate it first, e.g. free trial).

Though there seems to me a difference between releasing early to get people to use it, and releasing to get people to pay for it.

I don't know. You could be right. But both require a benefit to the user; and both exact a cost from the user - of learning; time and effort of changing behaviour to integrate it into their life and apply to their problem; constraining other choices/products to integrate with the product (depending on what kind of product you have). It's natural to think price is the cost of something - but it's simply not. (It's true though, that customers also think of it that way).

hehe I'm getting a bit of the answering-the-comment-while-being-edited syndrome :-) It's a bit disconcerting seeing from the other side.