What is a financial consideration when adding users to cloud-based software?

When adding users to cloud-based software, a significant financial consideration is that the initial cost of the software can increase dramatically with more users. This is often due to many cloud services operating on a subscription model that charges based on the number of users. Each additional user typically necessitates an additional license or access fee, which can lead to a substantial rise in the overall cost as the user base expands.

Understanding this model is crucial for businesses planning to scale their operations or expand their teams, as it directly affects budgeting and financial forecasting. Companies must consider user growth and its impact on costs to ensure they manage their expenses effectively.