How does SurveyMonkey make money?

Steven Loeb · October 30, 2015 · Short URL:

SurveyMonkey uses a freemium model that it says helps to creates organic viral loop for the product

Sometimes the best way to do something is also the simplest way. There's a ton of big data companies out there designed to find out what you think, and to know you better than you know yourself. The simpler way is to just ask.

That's the idea behind online survey development company SurveyMonkey, which lets companies create and send surveys, then use that data to make better business decisions.

SurveyMonkey uses a freemium business model, meaning everyone is free to sign up, create, and send a survey with basic features, including 10 questions, 100 responses and e-mail support, for free. It also offers tiered pricing plans, which start at $26 a month and go to $780 a year, which offer more responses and features, such as custom logos, question & answer piping, white label surveys and HIPPA-compliant features.

However, product has feature walls around survey customization, branding, and logic so advanced use cases subscribe for paid plans to unlock those features.

SurveyMonkey offers three tiered pricing plans. The lowest is its Select plan, for $26 a month or $228 annually, with features such as custom logos and colors, skip logic, cross tabs and filters, and the ability to export data.

The next plan is the Gold plan, for $25 per month or $300 annually, which comes with statistical significance, text analysis, question and answer piping, and randomization.

The third plan is its Platinum plan, which is for teams. It costs $65 a month per user or $780 annually, and it comes with the abiity to add multiple users, team collaboration, white label surveys, phone support and HIPAA-compliant features.

"Paid plans are offered on subscription basis, ensuring uninterrupted access for the customers.
Freemium model works for SurveyMonkey because it creates organic viral loop for the product. As customers send out surveys, even if they never pay, they spread SurveyMonkey brand to survey respondents who eventually might become survey creator," Elena Verna, VP of Growth at SurveyMonkey, told me.

Founded in 1999, SurveyMonkey has raised $1.15 billion in funding, including a $250 million round of equity financing in December of last year, which valued the company at $2 billion. SurveyMonkey investors include Tiger Global Management, T. Rowe Price, Morgan Stanley Asset Management, Baillie Gifford, Spectrum Equity, Google Capital, and Social + Capital.

Its customers currently include 99% of the Fortune 500.

Support VatorNews by Donating

Read more from our "Making Money" series

More episodes