Does a forever free plan hurt early software monetization?

We initially launched with a permanent free tier, hoping a large base of free users would naturally convert to paying subscribers over time. Instead, hundreds of users remained on the free plan indefinitely, consuming cloud resources without ever reaching the feature limits we set for conversion. we replaced the free tier with a strict 14-day full-access trial requiring a credit card upfront. Account signups dropped significantly, but our trial-to-paid conversion rate improved by 300% within the first month.

​Is a forever-free tier counterproductive for early SaaS survival, or is it still a valid strategy for word-of-mouth growth?