Wave AI's Paywall-First Funnel: 10% Conversion at $30-50 CAC

Wave AI flipped conventional app wisdom. Most apps hide their paywall until users experience value. Wave AI shows pricing immediately—and converts at 10%.

Open the app. See three slides explaining what it does. Then the paywall appears. You haven't recorded anything yet. You're staring at pricing options before you've tested a single feature.

The result? Double the conversion rate of most productivity apps.

When everyone screams value-first, Josh Moore whispered price-first

Josh launched Wave AI with a contrarian bet. Show everyone the paywall immediately. No exceptions. No "experience the magic first" philosophy. Just pricing, upfront, with a small X button in the corner.

His reasoning came from watching Meta's algorithm struggle:

"The signals you get from a trial are definitionally lower value than a subscription. By forcing the subscription to happen or not right up front we're potentially giving meta better signal."

Meta's machine learning needs clean data. When users start free trials, the algorithm sees noise. Install → Trial Start → Maybe Purchase (7 days later). Too many steps. Too much ambiguity.

Wave AI's funnel is binary: Install → Purchase or Exit. Meta learns faster because the signal is immediate. Someone either pays within minutes or they don't. No waiting. No wondering.

The buyers who don't need convincing

Josh discovered something that contradicted his instincts:

"My intuition was that you try it once and you're like oh my God I got to buy it... and then I looked at data and so many people buy it before they try it... like they see the ad they're like I'm in."

These buyers already decided from the ad. They watched the 15-second demo showing: record audio → get transcript → read AI summary. They understood the job. The app just needed to accept their money.

Traditional funnels make these people jump through hoops. Download. Explore. Find the upgrade button. Wave AI removes the friction. The paywall is waiting when they arrive.

The 30-minute free tier that forces decisions

Wave AI offers 30 minutes of recording per month for free. Not a 7-day trial. Not a feature-limited version. Just 30 minutes monthly.

Josh admits he guessed at this number:

"The 30 minute was a sort of a guess. I give them a little bit of taste and then they're gonna have to pay like you have a business to run."

Thirty minutes equals roughly two test recordings. Enough to validate the transcription works. Not enough for regular use. Users hit the limit quickly and make a choice: pay or leave.

No trial countdown creating urgency. No emails reminding you to subscribe. The product itself creates the decision point through usage.

Wave AI's pricing structure: Standard vs Professional

Wave AI offers 3 tiers designed to match usage patterns:

The Standard plan includes unlimited summary customizations and upcoming integrations like Zapier. The Professional plan adds cloud backups, advanced integrations (Slack, Zoom), and custom templates.

Weekly pricing is also available: $3.99/week for Standard and $8.99/week for Professional.

Annual pricing in the middle changes everything for this mobile app

Josh initially placed the annual plan on the right side of the paywall screen. Then he moved it to the center:

"We put annual in the middle it was on the right until like yesterday and we did a test with the middle and it's so much better these things make no sense but you know it is what it is."

The middle position reads as the default. The "normal" choice. Monthly feels like a recurring commitment. Annual sits in the sweet spot—substantial savings but not overwhelming.

This single change improved annual take-rate significantly. More annual subscribers means higher immediate revenue. Higher revenue per install means Meta's algorithm optimizes toward more valuable users.

The economics that make aggressive spending possible

Josh targets $30-50 cost per acquisition:

"I would love it to be like 30 bucks or maybe less and sometimes a little more and that's okay but yeah I mean I think I buy at 30 all day."

At 10% conversion with Wave AI's pricing, the math works:

• 100 installs cost $3,000-5,000

• 10 convert to paid subscribers

• Annual subscribers provide immediate revenue

• Monthly subscribers contribute to recurring revenue

• The deficit gets covered by retention

In July 2024, Josh spent $100K on ads. The paywall-first funnel made that scale possible.

The growth that validates the approach

Wave AI's revenue trajectory:

• February 2024: $100K ARR

• April 2024: $500K ARR

• June 2024: $1M ARR

• September 2024: $4M ARR

• November 2024: $5M ARR

• December 2024: $5.4M ARR ($450K MRR)

• May 2025: $6M ARR

• July 2025: $6M ARR

• September 2025: $7M ARR

"It is roughly doubling every month."

With ~500 paid subscribers at one point and 10% conversion rates maintained at scale.

Wave AI maintains a 4.9-star rating across 10,000+ reviews. Users aren't angry about seeing pricing immediately. They're rating the product quality, not the funnel position.

Why this works for Wave AI but might fail for you

Josh Mohrer's success depends on his ad creative. He shows exactly what Wave AI does in 15 seconds. Record a meeting. See the transcript appear. Read the AI summary. The value is obvious before the download.

If your ad is vague or aspirational, paywall-first will kill conversion. Users need to understand what they're buying before they see the price.

Wave AI also delivers immediately. First recording works perfectly. Transcription appears in seconds. If your product needs setup, configuration, or learning time, showing the paywall first will frustrate users who haven't experienced any value yet.

The paywall-first funnel isn't about being aggressive. It's about alignment. When your ad demonstrates the job clearly and your product delivers immediately, removing the friction between "interested" and "paying" improves conversion for everyone involved.

Josh proved you don't need to hide your pricing. Sometimes showing it first is exactly what converts.

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