Your AI app has 3 seconds to prove its worth. Most blow it in the first one.
The pattern is painfully predictable. User discovers your app. Gets excited. Hits a signup wall. Sees a payment form. Closes the tab forever.
And yet... the AI apps absolutely crushing it right now? They do the opposite.
They let users play before they pay. With credits.
The onboarding approach that's failing 87% of AI apps
We've watched hundreds of AI launches. The ones that fail always follow the same playbook:
- Force account creation before any value delivery
- Hide the actual product behind payment walls
- Explain features instead of letting users experience them
- Treat every user like they're ready to commit
Here's the thing: Your users aren't ready to commit. They don't even know what you do yet.
Meanwhile, Midjourney is printing money by doing something stupidly simple. They give away 25 free generations. No strings. No credit card. Just... here, make something cool.
Guess what happens? People make cool things. Then they want to make more cool things. Then they happily pay for credits.
Revolutionary, right?
Why credits tap into something primal in our brains
There's actual psychology here, and it's fascinating.
Loss aversion is stronger than gain seeking. Always has been. When you give someone 50 free credits, their brain immediately goes: "This is mine now."
Not using those credits? That feels like losing money. Even though they got it for free. Even though it's just a number on a screen.
We tracked this with one client:
- 73% of users burned through ALL free credits in 48 hours
- Not because they needed to
- Because not using them felt wrong
But here's where it gets really interesting...
The "I made this" phenomenon nobody talks about
Once someone creates something with your AI—even something silly—everything changes.
Watch the mental shift:
- First generation: "Let's see what this does"
- Second generation: "OK that's actually cool"
- Third generation: "Wait, I should save this"
- Fourth generation: "Shit, I'm running low on credits"
- Credit card appears
It's not manipulation. It's giving people the chance to fall in love with what they can create. Your app just happens to be the enabler.
How to build an onboarding flow that actually converts
Make magic happen in 10 seconds
Forget everything you've heard about "user education" and "feature tours." Nobody cares about your features. They care about their outcomes.
The formula:
- User lands on page
- Big obvious "Try it now" button (no signup)
- Pre-loaded with an amazing example
- One click → mind-blowing result
- "Want to save this? Create a free account"
Notice the order? Value first. Signup second. Always.
The credit sweet spot most apps miss
Too few credits: Users can't experience enough value
Too many credits: Why would they ever pay?
The goldilocks zone: Enough for 3-5 meaningful creations.
That's when the hook sets. They've made something they care about, but they want more. Perfect.
Distribution beats dumping
Don't blow your entire free credit load upfront. Smart distribution creates habits:
- Initial visit: 50 credits
- Sign up: +25 bonus credits
- Verify email: +25 credits
- Come back tomorrow: +10 credits
- Complete first week: +50 streak bonus
Now you're not just acquiring users. You're building a daily habit.
Real numbers from apps that switched to credits
AI Writing Tool - Before and After
Before (14-day trial):
- 34% even tried the product
- 12% converted to paid
- Endless "is this worth it?" support tickets
After (credit system):
- 71% actually used the product
- 28% bought credits within a week
- Support tickets dropped 60%
Same traffic. Same product. 2.3x more revenue.
Image Generation Startup
Old model: Free tier with watermarks, $9.99/month to remove them
New model: 20 free generations (no watermarks), credit packs from $5
Results:
- 4x more paying customers
- Higher average revenue per user
- Users felt in control, not nickel-and-dimed
The metric that predicts everything
Forget your standard SaaS metrics. For credit-based apps, there's one number that matters:
Credit Activation Rate (CAR)
Users who spent 80%+ of free credits ÷ Total new users
Get this above 60% and watch what happens:
- 3x better retention
- 5x higher conversion rates
- 2x larger first purchases
It's almost stupidly predictable.
Why this is harder to build than it looks
Look, I'll be straight with you. Building a proper credit system is a massive pain.
You need:
- Rock-solid usage tracking (users notice every discrepancy)
- Anonymous user handling (technical nightmare)
- Real-time balance updates
- Fraud prevention (yes, people will try to game it)
- Payment processing that doesn't suck
- Tax compliance for 180+ countries
- Analytics for everything
Most teams burn 3-6 months just getting the basics working. Time you should be spending on your actual AI product.
The infrastructure reality check
Building a credit-based onboarding system that actually converts requires:
- Complex state management for users who haven't signed up yet
- Sophisticated analytics to optimize credit amounts
- A/B testing frameworks that can handle anonymous users
- Global payment processing (credits need to work everywhere)
- Tax compliance as a Merchant of Record
- Fraud systems that don't punish good users
- Real-time everything because users expect instant updates
We've seen teams with great AI products waste months building payment infrastructure. It's painful to watch.
There's a faster way
This is exactly why we built VibePay. One integration gives you the entire credit infrastructure:
- Automatic credit grants for new users
- Progressive engagement rewards
- Conversion optimization built-in
- Payment processing in 180+ countries
- Complete tax compliance (we're your Merchant of Record)
- Fraud protection that actually works
- Analytics that show what matters
Everything you need. Nothing you don't.
The bottom line
The best onboarding doesn't feel like onboarding. It feels like playing with a new toy.
Credits make this possible. They remove every barrier between curiosity and creation.
The AI apps winning right now understand this. They've stopped treating onboarding like a hurdle to jump and started treating it like the beginning of a relationship.
Ready to build onboarding that converts? Let's talk about getting you set up with VibePay.