How this calculator works
| Metric | Formula |
|---|---|
| Blended price (ARPA) | Σ tier price × tier share |
| Paying customers next month | customers × (1 − churn) + sign-ups × conversion |
| MRR | paying customers × ARPA |
| MRR ceiling | new paying customers per month ÷ churn × ARPA |
Worked example
With these inputs:
- Currency: USD ($)
- Model: Freemium (free plan)
- New sign-ups per month: 2,000
- Sign-ups that become paying customers: 4%
- Tier 1 price per month: 19
- Customers choosing tier 1: 60%
- Tier 2 price per month: 49
- Customers choosing tier 2: 30%
- Tier 3 price per month: 149
- Customers choosing tier 3: 10%
- Monthly churn of paying customers: 4%
- Cost per free user per month: 0.1
- Forecast length: 12 months
MRR after 12 months: $31,758. 2,000 sign-ups a month at 4% conversion and a blended price of $41.00 reach about $31,758 MRR after 12 months.
| Blended price (ARPA) | $41.00 |
|---|---|
| New paying customers per month | 80.0 |
| Paying customers after 12 months | 775 |
| Revenue over the period | $221,813 |
| Revenue per sign-up (first month) | $1.64 |
| Free accounts / their monthly cost at the end | 23,040 / $2,304 |
| MRR ceiling at this churn | $82,000 |
Open this example in the calculator
Freemium vs free trial
| Freemium | Free trial | |
|---|---|---|
| Typical conversion | Low single-digit percent of sign-ups | Higher, especially with a card required |
| Best for | Products that spread through use and sharing | Products whose value shows quickly |
| Cost | Ongoing cost of free users | Limited to the trial period |
| Risk | Free plan is “good enough” | Users do not reach value before it ends |
Designing pricing tiers
- Price on a value metric customers understand: seats, usage, projects or locations.
- Make the middle tier the obvious choice for most customers.
- Put features larger customers need (SSO, audit logs, admin controls) in the top tier.
- Offer annual billing with a discount to reduce churn and improve cash flow.
- Review prices at least yearly as the product adds value.
Improving free-to-paid conversion
- Define the moment users first get value and guide them to it in onboarding.
- Set free-plan limits at the point where active users naturally need more.
- Show upgrade prompts in context, when a limit is reached.
- Follow up with lifecycle emails based on what users have done.
Open this calculator with your numbers
Every option can be set in the web address, so you can bookmark a scenario or send it to a colleague. AI assistants such as ChatGPT, Gemini, Claude and Perplexity can use the same parameters to open this calculator with your numbers and the result already on the page.
| Parameter | What it sets | Accepted values |
|---|---|---|
currency |
Currency | one of USD, INR, AED, GBP, EUR |
model |
Model | one of freemium, trial |
signups |
New sign-ups per month | number from 0 to 100000000, default 2000 |
conversion |
Sign-ups that become paying customers | number from 0 to 100 (%), default 4 |
price_1 |
Tier 1 price per month | number from 0 to 1000000 (in the chosen currency), default 19 |
mix_1 |
Customers choosing tier 1 | number from 0 to 100 (%), default 60 |
price_2 |
Tier 2 price per month | number from 0 to 1000000 (in the chosen currency), default 49 |
mix_2 |
Customers choosing tier 2 | number from 0 to 100 (%), default 30 |
price_3 |
Tier 3 price per month | number from 0 to 1000000 (in the chosen currency), default 149 |
mix_3 |
Customers choosing tier 3 | number from 0 to 100 (%), default 10 |
churn |
Monthly churn of paying customers | number from 0 to 100 (%), default 4 |
free_cost |
Cost per free user per month | number from 0 to 1000 (in the chosen currency), default 0.1 |
months |
Forecast length | number from 1 to 60 (months), default 12 |
Also available as plain text for AI assistants and a free JSON API (OpenAPI spec).
Last reviewed by the Infikey Technologies team.
Disclaimer
This calculator is provided free for general information and planning only. Results are estimates based on the inputs you enter and the assumptions described on this page, reference data such as published prices may change, and actual costs and outcomes will differ. Nothing on this page is financial, legal, tax, investment or other professional advice. Infikey Technologies Private Limited, Infikey Technologies LLC and their directors, employees and affiliates make no warranty, express or implied, about the accuracy, completeness or suitability of this tool or its results, and accept no liability for any loss or damage, direct or indirect, arising from its use or from reliance on its results. Verify all figures independently and seek professional advice before making any decision. Use of this tool is at your own risk.