Thanks so much everyone. It's really thoughtful and generous of you to provide such insightful feedback.
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As someone else pointed out, that one-time-fee is simply a short term infusion of cash but the member then becomes a cost for the lifetime of the business.
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I just thought I'd respond to this particular comment, because obviously it's important to everyone that we stick around. In my past life I was a management consultant. In fact, all of us, including Rob and the non-exec directors, were. Our jobs were all about strategy, forecasting, valuation, etc. So if there's one thing we're careful about, it's getting the numbers right! Our models we use for business planning incorporate all aspects of the business, including the fact that member accounts are a one-time fee. They also include all the actual conversion rates we are observing, and all costs. They also include scenarios where conversion rates drop and costs increase.
We re-run these models every week. It was the change in recent conversion behaviour that led our worst-case model to flag that the NPV of new customers could be negative, and this led to the membership fee increase.
Of course, it may simply be that the new users take a little longer to upgrade, in which case the extra membership fee will simply result in extra revenue for us to spend to development, marketing, or a price decrease down the track.
