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Business Operations Business Models

How Does LastPass Make Money (Business and Revenue Model)

The LastPass business model

LastPass logo
Here’s what you should know:
  • What is LastPass, and how does LastPass work?
  • How does LastPass make money?
  • Subscription Revenue (LastPass Premium)
  • Additional Add-on Services
  • Ad Revenue
  • LastPass funding, net worth, and valuation
  • LastPass profit and revenue
  • What is the LastPass business and revenue model?
  • LastPass subsidiaries, acquisitions, and exits

How does LastPass make money and how is it free to use? Well, here is a complete, in depth, breakdown of their three (3) revenue streams and the different products and services they offer, as well as the LastPass business and revenue model, how much LastPass makes per year, and how LastPass works.

What is LastPass, and how does LastPass work?

LastPass is a freemium password manager that allows users to safely store passwords online.

Founded in 2008 by Andrew Zitnay, Joe Siegrist, Robert Billingslea, and Sameer Kochar, LastPass went on to later get acquired by LogMeIn on Oct 8, 2015, for a reported $110 million.

Since that time, LastPass now has more than 33 million users and 100,000+ businesses using its password manager.

So, how does LastPass work? To use LastPass, you can start by first either downloading their mobile app on Apple Store or Google Play store; or visiting their website and downloading the LastPass browser extension for the browser you use (Google Chrome, Firefox, Safari, Opera, etc).

Once downloaded, create an account and choose a secure master password for it. From there, you can then add all of the sites you visit and save and or make those passwords stronger.

Some of LastPass’ competitors include 1Password, Bitwarden, Dashlane, and other password managers.

LastPass App in Apple App Store | LastPass Business Model | How Does LastPass Make Money | How Does LastPass Work
Source: Apple App Store | LastPass

How does LastPass make money?

According to LastPass, LastPass has 33+ million users and more than 100,000+ businesses using its password manager. So how does LastPass make money off of all these users?

Below is a breakdown of how much money LastPass makes and its revenue model. Including all revenue streams and how much they charge for their services.

Here are the 3 ways how LastPass makes money in 2022

LastPass has a revenue model that makes money in three (3) ways; through subscription revenue (LastPass Premium), additional add-on services, and ad revenue.

#1. Subscription Revenue (LastPass Premium)

LastPass makes most of its money from its subscription revenue.

Although LastPass has a freemium version, LastPass also offers four (4) subscription plans to choose from for users who want more security – they are; Premium, Family, Teams, and Business.

All of which offer additional perks and features that the free version does not offer such as unlimited device types, dark web monitoring, advanced MFA options, and more – depending on the pricing plan. Which you can see below.

How much does a LastPass subscription cost? (LastPass pricing plans)

  • Premium: $3 per month
  • Family: $4 per month for up to 6 family members
  • Teams: $4 per month, per user for up to 50 users
  • Business: $6 per month, per user
LastPass for browser | LastPass Business Model | How Does LastPass Make Money | How Does LastPass Work
Source: LastPass

Note: Of LastPass’ 33+ million users, LastPass has not disclosed how many of those are paying users.

#2. Additional Add-on Services

LastPass Business Plan users also have the option of purchasing additional add-on services that can be added to their Business subscription plans.

These two (2) add-ons are advanced Single Sign-on (SSO) and advanced Multifactor Authentication (MFA). Which are only available to Business Plan users and are added onto the $6 per month, per user costs. Which you can see the additional costs below.

LastPass advanced MFA and SSO costs:

  • Advanced SSO: $2 per month, per user
  • Advanced MFA: $3 per month, per user

Note: These add-ons are available to Business Plan users only.

#3. Ad Revenue

In addition to the subscription and add-on revenue, LastPass also makes money via the ad revenue it earns from third-party display ads.

As described in LastPass’ Privacy Policy, they allow display advertisers, like DoubleClick or Dynamic Remarketing, to serve up interest-based ads on their website.

LastPass funding, net worth, and valuation

According to LastPass’ Crunchbase profile, it’s unclear how much money LastPass has raised.

On Oct 8, 2015, LastPass was acquired by LogMeIn for $110 million.

LastPass profit and revenue

In 2021, LastPass had a reported $200 million USD in revenue.

Note: Because LastPass is a privately held company, they are not required to make their annual reporting, such as Form 10-K’s, pubic.

What is the LastPass business and revenue model?

LastPass makes money through a few revenue models that they combine within their company, they are:

  • Freemium (upselling) business model
  • Subscription business model
  • Advertising based business model
  • Business to business (B2B) business model
  • B2B2C (partnerships) business model
  • Mergers and acquisitions (M&A) business model

LastPass subsidiaries, acquisitions, and exits

Aside from LastPass being acquired by LogMeIn for $110 million, LastPass has had its own fair share of acquisitions.

To date, LastPass has made a total of 1 acquisition.