The Asana business model

Asana in the last four years has increased its value from $280m to $600m following a freemium business model. After the last fund rising round in March, Asana is expected to move active users from free to premium, not surprisingly. How do they aim to do it?

On September 2015, founders Dustin Moskovitz and Justin Rosenstein launched the new Asana. Back then Asana counted around 10,000 premium users and over 140,000 companies of all kinds –growing over 10,000 organizations a month– with a number of active users over 2 millions.

Asana free has almost the same features than premium, being the limit of 15 members per workspace the only hard constraint. How can they get free users to go premium paying more than $5 per user a month?

This question must be a real concern to the new operations director Chris Farinacci: If he tries to impose any kind of scarcity paradigm, that is, less features or a lower threshold than 15 members, virality rate will decrease and current users will choose other collaborative tool among a highly competitive marketplace:

For the peace of mind of freemium users, Asana strategy seems to be going towards an abundance paradigm, making the pie bigger providing more functionality to premium users, without sacrificing the increasing share of freemium users.

Task management is a global problem. Everybody has tasks to do or tasks to be delegated to someone else. In organizations there are tasks to be completed by teams and many of them have to be managed in a professional way, using project management standards, processes, tools and techniques well known by project managers, so that projects meet schedule and cost constraints.

In the same way that email and social networks covered the global need to communicate everywhere anytime, and to keep permanently connected with others and up to date, etc. Will Asana founders be able to cover our basic need of getting things done?

From my point of view, Asana success can be explained due two key factors:

  1. An excellent interface (user experience and performance): No wonder founders coming from Facebook and Google. Great challenges in web programming are solved brilliantly in Asana –list management, co-authoring, quick page loading, searching, filtering, charts, notifications, third party integrations, developer extensions, etc. Asana invested hard on architecture and web programming models –they have their own architecture platform called Luna2.
  2. A well designed data model covering the whole set of requirements and use cases in task management.

Asana data model, at the core of it, could be depicted more or less like this:

  • TASK is the central information piece. A set of tasks can be grouped into a PROJECT. Any task can belong to many projects at the same time, i.e. we can have the same task on different lists.
  • A WORKSPACE is a team of members working together on several related projects. MEMBERS belonging to a work space have access to all tasks in public projects. Any task can be assigned (or not) to a unique accountable person, or ASSIGNEE, who can be a MEMBER –members have complete functionality– or a GUEST –guests can only see their own tasks. Any member in a WORKSPACE can see a list of complete or incomplete tasks, being theirs or assigned to other members or guests.
  • Any task list may be shown under different VIEWS –incomplete tasks, completed tasks, all tasks, tasks by due date, tasks by assignee, etc. Besides, there are several ways to show any project tasks –list, calendar, progress and files. Task assigned to ourselves, even if they don’t belong to any project, can be quickly prioritized in MY TASKS private section.
  • Any project may have several CONVERSATION threads. When there is a change in a task, FOLLOWERS receive NOTIFICATIONS messages in MY INBOX private section.

Virality is easily achieved in Asana. To start using Asana you only need an email address –most people use their personal email. There are three main use cases in Asana:

  • If we want to use Asana only on our own, we use the folder PERSONAL PROJECTS. Tasks in personal projects are done by ourselves, but sometimes we need to delegate some task to other. We can assign tasks to guests. If the assignee is new to Asana, the invitation email will lead him to the sign up page. First thing he will see when entering Asana will be the new task inside his PERSONAL PROJECTS section. There is no PROJECT OWNERS –Asana users are the owners of their personal projects– and there is no MEMBERS –we can only have GUESTS to our personal projects.
  • If we need to work as a team, any user can create a WORKSPACE and then invite other members. This is the way most users use Asana. Any WORKSPACE member can invite others –members or guests– up to the freemium limit of 15 members per WORKSPACE. There is no limit in the number of guests. Users can leave any WORKSPACE when they want –they can be reinvited. There is no limit for the number of WORKSPACES any user can create, but they are mutually exclusive, you cannot copy tasks, projects … –what happens in a WORKSPACE, stays in a WORKSPACE. If the team has less than 15 members, the tool is practically 100% functional. Another important constraint is that members have to be totally reliable: They can see all tasks in public projects and they can do anything, even to complete or delete any other’s task. There is no administrator role.
  • These problems are solved with the premium model, which consist basically on using ORGANIZATIONS. Inside an organization we have TEAMS instead of WORKSPACES, being the functionality the same. Any MEMBER may belong to several TEAMS inside an ORGANIZATION. Now you can set user access configuration options, hide certain projects or teams, move projects from one team to another, etc. Users experience is better because with the same access they have centralized in one tool all task management in all personal and professional contexts:

In order to move from freemium to premium, you have to access with a company email –Gmail accounts are not allowed. You pay for a limited member number, billed monthly or annually –saving 2 months– and from then on any user accessing with that company email will consume one license –if administrator approves. Guests do not use the company email. Asana premium plan is reversible: you can decrease the number of members or even get back to freemium. Administrator may deprovision any current member, if needed. Administrators can also register new members, although it is more common that current members invite the new ones to a concrete team.

ORGANIZATIONS model seems to be aimed to big companies. Many small companies may cover 100% of their functional requirements with WORKSPACES: They don’t cover their non functional requirements about security and administration, but they can live with it. Asana sales teams, aware of that problem, are launching email campaigns to schedule videoconference meetings with prospects –many teams use ORGANIZATIONS with their company email for free, since payment is not mandatory. On the other hand, there is a lot of marketing on the new premium features, mainly these three:

  • Dashboards: Any user can see any project high level summary with the health check indicator –red, yellow, green–, a short comment by the project owner, a due date and a burn-up chart on total vs. incomplete tasks. In WORKSPACES, users can see only 3 projects dashboards on his private section DASHBOARD. In ORGANIZATIONS there is no 3 projects limitation.
  • Dependencies: Any task can be marked as waiting on others, so that many notifications are automated among assignees and followers working on tasks with precedence relationships.
  • Track Anything (Beta): This is the most remarkable functionality. Users can add new fields inside tasks, manage lists with customized columns and have new features for searching, filtering, grouping, notifications, dashboards, etc. Programmers have a new API to build new customized extensions to Asana.

Quoting Rosenstein’s words:

“Track anything will make Asana something as easy to use as a spreadsheet, but as powerful as a database.”

This article is also available in Spanish.

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