Paid Ad Channel for PLG

Using paid ad as a catalyst for PLG

Author

Gary Chan
March 06, 2025

Launching PLG with Paid Ad

When we launched our PLG motion back at the end of 2022, we needed to make a bang and get a lot of traffic coming in so that we could start creating momentum around our freemium offering. 

In the beginning, the company spent a lot of money on pay ads, competing against some incumbent competitors that were also using pay ad as a channel. 

We felt that with our freemium tagline, we can overcome them in marketing to our ICP, early stage and growing stage startups.

We had a massive amount of sign-ups because the free plan was incredible and attractive to a lot of founders. We use LinkedIn as the primary paid ad channel. 

PLG Sign-ups from Paid Ad

We knew we had to "juice" the traffic and acquisition signups so that we can get enough data points to quickly improve our onboarding experiences. 

And the traffic started coming in, and we immediately got them signed up for our onboarding calls. 

It was definitely challenging because we had sign-ups coming in and our onboarding call was just not refined enough... 

We didn't have enough answers to handle objections. The way we described our mission and our understanding of the product wasn't fluent enough to reassure our customers. The number of customers that were signing up were definitely attracted to the free plan, so they weren't immediately interested in buying. This makes total sense. However, in the very beginning, in the first three months or so, folks internally in the company where questioning the strategy. 

Creating a PLG Paid Ad Flywheel

Slowly, we began to refine the onboarding calls. We were reassuring our customers and yes, we were able to handle the objections on why it is free and transition them to up-sell opportunities. 

In my previous post, I talked about the CAC LTV Excel sheet and how we're starting to actually make the money back off our paid ad investment each month. 

Any additional revenue would be put back into the Flywheel, solidifying that we're building a sustainable Product-Led Growth motion. 

For us, we were able to make the CAC LTV 1:1 ratio. This means that we need to make the Flywheel go faster by investing in more because $1 in equals $1 out, and if we put $2 in, not only do we get $2 out, but we also get more customers and generate our word-of-mouth flywheel. 

The folks that signed up and didn't buy were creating virality and word-of-mouth because we did give them free access to the platform. When they went into their communities and networks, they were praising us, letting other folks know that there is a free option out there. 

So this pay ad channel starts to drive that word of mouth flywheel. The pay ad became the catalyst to getting users onto the platform, us learning very quickly, iterating, reassuring customers, and getting folks to feel the value of our freemium tier, which influences the word-of-mouth virality growth flywheel channels. 

Read more about CAC LTV with Product Led Growth:

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I am Gary Yau Chan. 3x Head of Growth. Product Growth specialist. 26x hackathon winner. I write about #PLG and #BuildInPublic. Please follow me on LinkedIn, or read about what you can hire me for on my Notion page.