Give "Unlimited" stuff if you hate your business

The New Year started off slowly. I worked less and enjoyed the break, but I still made it a point to show up.

This consistency led to new successes: great clients, exciting projects, and a fresh wave of energy for 2025.

But I’ve come to realize a truth that I continue to learn: even when you’re doing everything right, friction is inevitable.

Some people will doubt your approach, while others may criticize your choices. That’s why I’m focusing on what I love this year.

Because no amount of external noise can compare to the power of pursuing your passions.

Now, let's discuss something I don’t enjoy seeing: "Unlimited Use" Licenses.

At first, they appear to be simple and straightforward - a great way to seal a deal and satisfy everyone involved.

Yet, that kind of simplicity often comes with hidden costs. Let me explain.

The Problem with Unlimited Use Licenses

What normally happens is - you'll develop a powerful software tool for a client. They love it and request full, unrestricted use of the software.

They want no limits on users, no geographic restrictions, and no fees, even if their usage skyrockets.

Initially, this sounds great, and you agree to their terms. The deal is made. Fast forward six months - what happens when:

- Their business doubles, triples, or expands globally using your software, but they haven’t paid a penny more?

- Compliance issues arise because someone modified your tool for a purpose you hadn’t anticipated.

This is what “unlimited use” really entails:

1. Lost Revenue Potential: You’ve effectively capped your earnings by giving away future value for free.

2. Legal and Compliance Risks If your software is misused, you could still be held liable, even if you didn’t authorize the misuse.

A Better Approach to Licensing

Instead of giving up control over how your software is used and the revenue it brings in, it’s super important to think carefully about how you set up your licensing.

Here are a few of my strategies to make your licensing model even better:

1. Tiered Licensing

Consider creating a tiered licensing system that groups users based on different access levels and usage rights.

This lets you set specific limits on user numbers, locations, or usage amounts.

For example, you could have different tiers for small, medium, and large businesses, with each one offering more features.

When clients want to add more users beyond what their current tier allows, you can turn that into an upsell opportunity, helping you earn more as they grow.

2. Threshold Fees

Set clear usage limits that, when crossed, lead to extra fees. This gives clients a solid cap on what standard usage looks like and helps them think about how they consume your product.

For instance, you might limit the number of transactions or the amount of data a client can use in a billing cycle.

If they go over that limit, they’ll face additional charges, making sure that any increase in their usage also boosts your revenue.

This model not only covers the costs of higher usage but also makes clients more aware of how much they're using.

3. Usage-Based Pricing

Think about a pricing model that directly ties costs to what clients get from your software.

In this setup, the more value they get, the more they pay. It’s a fair way to do things because it links pricing to actual usage instead of random fees.

It also creates a predictable framework for both you and your clients.

They’ll appreciate this straightforwardness, as they only pay for what they actually use, which can help build loyalty and long-term relationships.

You can use any of these strategies. But the point is to keep control over your offerings and maximize revenue as your software becomes more popular.

Protect Profitability with Structure

In the tech industry, simplicity can help you close a deal quickly, but setting clear boundaries is what truly protects your future.

The next time someone requests unlimited rights, consider the long-term implications. Clearly define your terms and align usage with the value provided.

Profit is not generated through shortcuts; it comes from smart systems.

This approach allows you to build a business that grows with you, rather than working against you.

If you want my help setting up any of this in a contract or more, then reach out to me on LinkedIn.

Just drop a DM there and let's talk.