Startups often find themselves constrained by time, money, and resources, forcing entrepreneurs to creatively hack their way to efficient solutions. Seattle-based startup Peasy is a shining example of this scrappy yet genius entrepreneurial mindset. Founded by Ryan Conti and Bryan Mitchiner, Peasy has not only managed to disrupt traditional spreadsheet dependency in the Consumer Packaged Goods (CPG) industry but has also boldly gone where very few startups dare: it’s giving its core product away for free. So, what makes this approach so unique, and why should founders and business owners pay close attention to it? Let’s delve deeper.
Why Peasy Stands Out in the Startup Space
Imagine you’re running a small or mid-sized CPG brand, perhaps producing artisanal jams or organic skincare products. Chances are, you’re relying on spreadsheets to manage inventory, operations, and analytics. This is both time-consuming and error-prone, eating away at the time you could otherwise spend innovating your product or scaling operations.
Peasy saw this inefficiency and designed an operating system that centralizes inventory and operational management for independent CPG brands. Brands that use Peasy eliminate the spreadsheet chaos and reduce manual data entry by about 60%, while gaining better insights into inventory forecasting and demand changes. In an era where efficiency is everything, this kind of impact cannot be overstated.
But here’s the kicker, their software is completely free.
The Vision Behind a Free Product Offering
Peasy's decision to offer its inventory management software for free is grounded in what co-founder Ryan Conti described as a fight against the status quo: “We’re competing with spreadsheets… and spreadsheets are free.” The lightbulb moment here is a fundamental understanding of their audience. Small CPG businesses opt for spreadsheets not out of preference but because of their zero cost. Peasy’s free software levels the playing field, allowing these brands to benefit from advanced solutions without financial constraints.
But let’s not mistake "free" for "unsustainable", Peasy has strategically aligned its monetization model with a long-term vision. Instead of charging subscription fees, they generate revenue through payment processing fees on financial transactions between brands, suppliers, and logistics providers that flow through their platform. This is what Peasy’s investors called a “harmonic business model,” where both the startup and its customers share in the upside as they grow.
A Unique Business Model: “Free is a Hell of a Wedge”
The founders recently raised $2 million in a pre-seed funding round backed by Founders’ Co-op and Bread and Butter Ventures, giving them the financial runway to test this unconventional pricing model. Conti’s LinkedIn post about the funding announcement included a simple yet profound statement: “Free is a hell of a wedge.”
This model perfectly reflects broader trends in SaaS, where artificial intelligence-driven tools and services are moving towards outcome-focused pricing models. As seasoned startup founder Violetta Bonenkamp observes, the true innovation lies in creating win-win scenarios where both the business and its clients scale symbiotically. Peasy accomplishes that by removing the friction associated with upfront costs and allowing customers to grow on their own merit before monetizing their success.
How Entrepreneurs Can Learn from Peasy’s Approach
If you’re a founder considering how to disrupt your space or take your SaaS product to market, there are key takeaways from Peasy’s strategy:
1. Know Your Competition (Even if it’s a Spreadsheet)
- Don’t underestimate the “default” solution your customers are using. Even something as basic as spreadsheet reliance can signal an opportunity if you’re improving or automating a cumbersome process.
2. Innovate Your Revenue Model
- Subscription-based pricing is not the only path to monetization. Outcome-based, transaction-based, or usage-based pricing models are increasingly disrupting traditional SaaS norms.
3. Focus on Strong Unit Economics
- Offering a free product makes sense when your backend monetization is scalable and aligned with customer growth.
4. Be Transparent with Your Value Proposition
- Peasy’s messaging clearly speaks to its target audience: independent CPG brands that feel underserved. Aligning your product with the specific pain points of a niche audience is critical when disrupting entrenched habits.
Most Common Mistakes to Avoid When Offering Freemium SaaS Services
While Peasy’s approach is exciting, it’s worth noting that rolling out a freemium model is not without risks. Founders should steer clear of these common pitfalls:
1. Overpromising and Underdelivering
- A free tier is a great growth hack, but only if the product actually solves your target audience’s pain points. If your solution falls flat, you risk losing trust.
2. Failing to Define Transition Metrics
- Make sure there’s a clear metric or touchpoint where customers transition into customers. For instance, Peasy ties its success to the growth of customer transactions.
3. Ignoring Customer Education
- Free software does not eliminate the need for guiding early adopters. Provide resources, webinars, or customer success managers to ensure your users adopt and stick with your solution.
4. Scaling Too Quickly
- Giving away your product for free can lead to a flood of users, but scaling prematurely without sufficient infrastructure can cripple your operations.
The Long-Term Implications of Peasy’s Model
For entrepreneurs in the CPG industry and beyond, Peasy's free tier and its focus on operational efficiency speak to a broader trend in SaaS: the symbiosis between customer success and company growth. Violetta Bonenkamp notes that such shifts signal the growing need for businesses to build with empathy, understanding the constraints and aspirations of their target demographics.
It’s also a fascinating lens into how startups can use frictionless entry points (like a $0 price tag) to build trust and loyalty while creating long-term value. In many ways, Peasy isn’t just replacing spreadsheets with better tools; it’s creating a collaborative ecosystem that empowers small businesses to thrive.
Conclusion: Rethink Your Go-to-Market Strategy
Whether you’re an aspiring entrepreneur, a freelancer scaling your consulting practice, or a seasoned founder in the SaaS space, Peasy’s approach offers rich lessons in disruption, empathy, and innovation. Giving away a core product for free may seem counterintuitive, but when tied to scalable backend revenue, it can create a growth engine that’s incredibly powerful.
Think about the markets you serve and reflect: What are their pain points? Are they clinging to suboptimal solutions simply because they’re cheap or available? If you can answer these questions and design a model that marries value with financial feasibility, you may just find your wedge into a crowded market.
Learn more about how industry-disrupting startups like Peasy are shaping the CPG landscape through platforms like GeekWire’s coverage. It’s not just the startups that succeed, it’s the ones brave enough to rethink the rules.
FAQ
1. What is Peasy and why is it significant?
Peasy is a Seattle-based startup that provides free inventory and operations management software for independent CPG (Consumer Packaged Goods) brands. It aims to replace traditional spreadsheet dependency, reducing manual data entry by up to 60% and improving forecasting. Learn more about Peasy
2. Who founded Peasy and what inspired it?
Peasy was founded by Ryan Conti and Bryan Mitchiner, both former executives at Shelf Engine. Their experience growing CPG brands and observing the inefficiencies of spreadsheets inspired them to create Peasy. Explore Peasy’s founders
3. Why is Peasy providing its core product for free?
Peasy’s co-founders decided to offer their software for free to compete effectively against spreadsheets, which are also free. This approach lowers the upfront financial barrier for small CPG businesses. Learn about Peasy’s pricing strategy
4. How does Peasy generate revenue despite being free?
Peasy charges payment processing fees on financial transactions conducted through its platform between brands, suppliers, and logistics providers. This transaction-based revenue aligns with customer growth. Understand Peasy’s monetization model
5. How much funding has Peasy raised and who are its investors?
Peasy secured $2 million in pre-seed funding from Founders’ Co-op and Bread and Butter Ventures. These funds provide financial runway to scale its innovative business model. Read about Peasy’s funding
6. Which companies are currently using Peasy?
Peasy is collaborating with eight design partners, including Frankie & Jo’s, a Seattle ice cream company, and has 30 additional brands on its waitlist. Explore Peasy’s partnerships
7. What pain points does Peasy solve for users?
Peasy addresses inefficiencies in manual spreadsheet management for inventory and operations, allowing brands to reduce errors and gain better insights into demand forecasting and inventory needs. Learn about Peasy’s impact
8. What does the phrase “Free is a hell of a wedge” mean in Peasy’s context?
Co-founder Ryan Conti described their free pricing strategy as a wedge into the market, allowing customers to experience their software without financial risk. Discover Peasy’s strategic insights
9. How does Peasy reflect broader industry trends?
Peasy’s outcome-based monetization model is part of a larger shift in SaaS pricing, favoring AI-driven, transaction-based revenue over traditional subscription fees. Learn about SaaS trends
10. How does Peasy’s freemium model benefit small CPG businesses?
By eliminating subscription costs, Peasy makes advanced inventory management tools accessible to small brands, helping them compete with larger players without financial strain. Understand Peasy’s market innovation
About the Author
Violetta Bonenkamp, also known as MeanCEO, is an experienced startup founder with an impressive educational background including an MBA and four other higher education degrees. She has over 20 years of work experience across multiple countries, including 5 years as a solopreneur and serial entrepreneur. Throughout her startup experience she has applied for multiple startup grants at the EU level, in the Netherlands and Malta, and her startups received quite a few of those. She’s been living, studying and working in many countries around the globe and her extensive multicultural experience has influenced her immensely.
Violetta Bonenkamp's expertise in CAD sector, IP protection and blockchain
Violetta Bonenkamp is recognized as a multidisciplinary expert with significant achievements in the CAD sector, intellectual property (IP) protection, and blockchain technology.
CAD Sector:
- Violetta is the CEO and co-founder of CADChain, a deep tech startup focused on developing IP management software specifically for CAD (Computer-Aided Design) data. CADChain addresses the lack of industry standards for CAD data protection and sharing, using innovative technology to secure and manage design data.
- She has led the company since its inception in 2018, overseeing R&D, PR, and business development, and driving the creation of products for platforms such as Autodesk Inventor, Blender, and SolidWorks.
- Her leadership has been instrumental in scaling CADChain from a small team to a significant player in the deeptech space, with a diverse, international team.
IP Protection:
- Violetta has built deep expertise in intellectual property, combining academic training with practical startup experience. She has taken specialized courses in IP from institutions like WIPO and the EU IPO.
- She is known for sharing actionable strategies for startup IP protection, leveraging both legal and technological approaches, and has published guides and content on this topic for the entrepreneurial community.
- Her work at CADChain directly addresses the need for robust IP protection in the engineering and design industries, integrating cybersecurity and compliance measures to safeguard digital assets.
Blockchain:
- Violetta’s entry into the blockchain sector began with the founding of CADChain, which uses blockchain as a core technology for securing and managing CAD data.
- She holds several certifications in blockchain and has participated in major hackathons and policy forums, such as the OECD Global Blockchain Policy Forum.
- Her expertise extends to applying blockchain for IP management, ensuring data integrity, traceability, and secure sharing in the CAD industry.
Violetta is a true multiple specialist who has built expertise in Linguistics, Education, Business Management, Blockchain, Entrepreneurship, Intellectual Property, Game Design, AI, SEO, Digital Marketing, cyber security and zero code automations. Her extensive educational journey includes a Master of Arts in Linguistics and Education, an Advanced Master in Linguistics from Belgium (2006-2007), an MBA from Blekinge Institute of Technology in Sweden (2006-2008), and an Erasmus Mundus joint program European Master of Higher Education from universities in Norway, Finland, and Portugal (2009).
She is the founder of Fe/male Switch, a startup game that encourages women to enter STEM fields, and also leads CADChain, and multiple other projects like the Directory of 1,000 Startup Cities with a proprietary MeanCEO Index that ranks cities for female entrepreneurs. Violetta created the "gamepreneurship" methodology, which forms the scientific basis of her startup game. She also builds a lot of SEO tools for startups. Her achievements include being named one of the top 100 women in Europe by EU Startups in 2022 and being nominated for Impact Person of the year at the Dutch Blockchain Week. She is an author with Sifted and a speaker at different Universities. Recently she published a book on Startup Idea Validation the right way: from zero to first customers and beyond, launched a Directory of 1,500+ websites for startups to list themselves in order to gain traction and build backlinks and is building MELA AI to help local restaurants in Malta get more visibility online.
For the past several years Violetta has been living between the Netherlands and Malta, while also regularly traveling to different destinations around the globe, usually due to her entrepreneurial activities. This has led her to start writing about different locations and amenities from the POV of an entrepreneur. Here’s her recent article about the best hotels in Italy to work from.
About the Publication
Fe/male Switch is an innovative startup platform designed to empower women entrepreneurs through an immersive, game-like experience. Founded in 2020 during the pandemic "without any funding and without any code," this non-profit initiative has evolved into a comprehensive educational tool for aspiring female entrepreneurs.The platform was co-founded by Violetta Shishkina-Bonenkamp, who serves as CEO and one of the lead authors of the Startup News branch.
Mission and Purpose
Fe/male Switch Foundation was created to address the gender gap in the tech and entrepreneurship space. The platform aims to skill-up future female tech leaders and empower them to create resilient and innovative tech startups through what they call "gamepreneurship". By putting players in a virtual startup village where they must survive and thrive, the startup game allows women to test their entrepreneurial abilities without financial risk.
Key Features
The platform offers a unique blend of news, resources,learning, networking, and practical application within a supportive, female-focused environment:
- Skill Lab: Micro-modules covering essential startup skills
- Virtual Startup Building: Create or join startups and tackle real-world challenges
- AI Co-founder (PlayPal): Guides users through the startup process
- SANDBOX: A testing environment for idea validation before launch
- Wellness Integration: Virtual activities to balance work and self-care
- Marketplace: Buy or sell expert sessions and tutorials
Impact and Growth
Since its inception, Fe/male Switch has shown impressive growth:
- 5,000+ female entrepreneurs in the community
- 100+ startup tools built
- 5,000+ pieces of articles and news written
- 1,000 unique business ideas for women created
Partnerships
Fe/male Switch has formed strategic partnerships to enhance its offerings. In January 2022, it teamed up with global website builder Tilda to provide free access to website building tools and mentorship services for Fe/male Switch participants.
Recognition
Fe/male Switch has received media attention for its innovative approach to closing the gender gap in tech entrepreneurship. The platform has been featured in various publications highlighting its unique "play to learn and earn" model.