Act on the result
Compare the required conversion with observed cohort records before expanding free-account acquisition or service capacity.
Educational only: Business decision support, not accounting, tax or legal advice.
Privacy: No account is required. Tool inputs and results stay in this browser. Anonymous categorical usage analytics send only governed page, tool, cluster and action identifiers; tool inputs and results are never sent. Error monitoring is disabled. Optional saved state stays only on this device.
Update policy: Reviewed when formulas or official dependencies change.
Scope: Market-neutral small-business planning using your own assumptions.
What this planner helps you decide
Best for
Subscription businesses testing whether paid conversion can fund a free-account programme.
Outputs
Paid accounts and revenue, free and paid service economics, programme contribution and nullable break-even conversion.
Start here
Enter one free-account cohort, a user-owned conversion assumption and the full free, paid and programme cost stack.
Use a different tool when: Do not use this to compare upfront annual cash and contribution with a retention-weighted monthly subscription cohort; use Annual vs Monthly Plan Planner for that decision. Use this tool to test whether user-entered conversion and paid-account contribution can cover free-account service and programme costs.
Cash & growth
Freemium Conversion Economics: paid accounts and revenue
Paid accounts and revenue, free and paid service economics, programme contribution and nullable break-even conversion.
Amounts use the same currency as your inputs. No currency conversion is performed.
Subscription economics assumptions
Use one consistent cohort, period, currency and tax basis.
Your numbers stay in this browser
Whole free accounts in the cohort.
User-entered share of free accounts converting to paid.
Recurring revenue for one converted paid account. Use one consistent currency, tax and period basis.
Cost to serve one free account. Use one consistent currency, tax and period basis.
Additional decision inputsOpen the assumptions you are less likely to change on every comparison.
Cost to serve one paid account. Use one consistent currency, tax and period basis.
Acquisition cost assigned to the cohort. Use one consistent currency, tax and period basis.
Fixed cost assigned to the freemium programme. Use one consistent currency, tax and period basis.
Decision result
All outputs come from the registered exact subscription engine.
- Paid accounts
- 50
- Paid revenue
- 1,500.00
- Free service cost
- 1,000.00
- Paid contribution
- 1,250.00
- Programme contribution
- -50.00
- Break-even conversion rate
- 5.2%
| Component | Result |
|---|---|
| Free-account service cost | 1,000.00 |
| Paid-account contribution | 1,250.00 |
| Acquisition and fixed programme cost | 100.00 + 200.00 |
| Programme contribution | -50.00 |
Scenario comparison
Each row names the assumption axis changed from the baseline.
ScenarioResultDifference
Entered scenario-50.00Baseline
Lower Conversion rate-300.00Not available
Higher Conversion rate200.00Not available
Save these results, change an input, then compare the updated figures with this baseline.
The baseline is temporary in this tab and is not added to shared scenario links or generated reports.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Paid accounts
Paid accounts
free accounts × conversion rate50 unitsResult50
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Paid accountsFree Accounts
- 1,000
- Paid accountsConversion Rate
- 0.05
- Paid accountsRevenue Per Paid Account
- 30
- Paid accountsService Cost Per Free Account
- 1
- Paid accountsService Cost Per Paid Account
- 5
- Paid accountsAcquisition Cost
- 100
- Paid accountsFixed Programme Cost
- 200
Paid revenue
Paid revenue
paid accounts × revenue per paid account1,500.00Result1,500.00
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Paid revenueFree Accounts
- 1,000
- Paid revenueConversion Rate
- 0.05
- Paid revenueRevenue Per Paid Account
- 30
- Paid revenueService Cost Per Free Account
- 1
- Paid revenueService Cost Per Paid Account
- 5
- Paid revenueAcquisition Cost
- 100
- Paid revenueFixed Programme Cost
- 200
Free service cost
Free service cost
free accounts × service cost per free account1,000.00Result1,000.00
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Free service costFree Accounts
- 1,000
- Free service costConversion Rate
- 0.05
- Free service costRevenue Per Paid Account
- 30
- Free service costService Cost Per Free Account
- 1
- Free service costService Cost Per Paid Account
- 5
- Free service costAcquisition Cost
- 100
- Free service costFixed Programme Cost
- 200
Paid contribution
Paid contribution
paid accounts × (paid revenue − paid service cost)1,250.00Result1,250.00
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Paid contributionFree Accounts
- 1,000
- Paid contributionConversion Rate
- 0.05
- Paid contributionRevenue Per Paid Account
- 30
- Paid contributionService Cost Per Free Account
- 1
- Paid contributionService Cost Per Paid Account
- 5
- Paid contributionAcquisition Cost
- 100
- Paid contributionFixed Programme Cost
- 200
Programme contribution
Programme contribution
paid contribution − free service cost − acquisition cost − fixed programme cost-50.00Result-50.00
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Programme contributionFree Accounts
- 1,000
- Programme contributionConversion Rate
- 0.05
- Programme contributionRevenue Per Paid Account
- 30
- Programme contributionService Cost Per Free Account
- 1
- Programme contributionService Cost Per Paid Account
- 5
- Programme contributionAcquisition Cost
- 100
- Programme contributionFixed Programme Cost
- 200
Break-even conversion rate
Break-even conversion rate
(free service cost + acquisition cost + fixed cost) ÷ contribution capacity0.05 percentResult5.2%
Uses user-entered subscription economics on one consistent cohort, period and currency basis. The engine retains raw precision; display formatting does not feed calculation.
Freemium Conversion Economics Planner formulas →Inputs used by these formula steps
- Break-even conversion rateFree Accounts
- 1,000
- Break-even conversion rateConversion Rate
- 0.05
- Break-even conversion rateRevenue Per Paid Account
- 30
- Break-even conversion rateService Cost Per Free Account
- 1
- Break-even conversion rateService Cost Per Paid Account
- 5
- Break-even conversion rateAcquisition Cost
- 100
- Break-even conversion rateFixed Programme Cost
- 200
Inputs used
- Free accounts
- 1,000
- Conversion rate
- 0.05
- Revenue per paid account
- 30
- Service cost per free account
- 1
- Service cost per paid account
- 5
- Acquisition cost
- 100
- Fixed programme cost
- 200
Open this calculator with preset values
This calculator supports documented, shareable scenario URLs. Compatible assistants and applications can construct links using the parameters below.
Scenario links contain only allowlisted numeric and closed-choice inputs shown in the URL; Margin101 excludes free text and identifying fields. Anyone you share the URL with can read those numbers, so do not include private or identifying data.
| Parameter | Meaning | Unit | Allowed values | Presence | Default |
|---|---|---|---|---|---|
| acquisitionCost | Acquisition cost assigned to the cohort. Use one consistent currency, tax and period basis. | currency units/cohort | 0 to 10000000 | Required | 100 |
| conversionRate | User-entered share of free accounts converting to paid. | decimal share of free-account cohort | 0 to 1 | Required | 0.05 |
| fixedProgrammeCost | Fixed cost assigned to the freemium programme. Use one consistent currency, tax and period basis. | currency units/programme/selected recurring period | 0 to 10000000 | Required | 200 |
| freeAccounts | Whole free accounts in the cohort. | accounts/cohort | 0 to 100000000 | Required | 1000 |
| revenuePerPaidAccount | Recurring revenue for one converted paid account. Use one consistent currency, tax and period basis. | currency units/paid account/selected recurring period | 0 to 10000000 | Required | 30 |
| serviceCostPerFreeAccount | Cost to serve one free account. Use one consistent currency, tax and period basis. | currency units/free account/selected recurring period | 0 to 10000000 | Required | 1 |
| serviceCostPerPaidAccount | Cost to serve one paid account. Use one consistent currency, tax and period basis. | currency units/paid account/selected recurring period | 0 to 10000000 | Required | 5 |
Freemium Conversion Economics: paid accounts and revenue
Use programme contribution and break-even conversion to test the entered scenario; conversion remains an assumption, not a causal forecast.
Formula summary
- Primary formula
- programme contribution = converted accounts × (paid revenue − paid service cost) − free service cost − acquisition cost − fixed programme cost
Data used here
- The estimate uses your inputs and the general business formula documented in the methodology.
Decision checks
Stress-test the decision
Retest a lower conversion rate and higher free-account service cost to expose the programme downside.
When this estimate can be misleading
- Conversion is a user-entered scenario, not a causal estimate or forecast.
- An unreachable break-even rate is shown explicitly instead of a value above 100%.
- Use one consistent cohort, period, currency and indirect-tax basis.
- This is educational decision support, not financial, tax, legal or accounting advice.
- Use programme contribution and break-even conversion to test the entered scenario; conversion remains an assumption, not a causal forecast.
Educational estimate, not advice. See all assumptions & limitations →
Related reading
Guides to interpret the decision and its assumptions.
- SaaS Unit Economics: Contribution, CAC, Churn and Cash
Connect contribution, acquisition cost, retention and cash timing while keeping cohort and horizon boundaries explicit.
Read guide
Frequently asked questions
How do I test whether user-entered conversion and paid-account contribution can cover free-account service and programme costs?
Compare the required conversion with observed cohort records before expanding free-account acquisition or service capacity.
Which planning assumptions should I stress-test?
Compare a plausible alternative scenario and verify the decision-critical assumption that changes the plan most.