Here's a hypothetical question... let's say you have a UGC site and so far everything on the site has been free but someone needs to start paying bills so you've been looking at various options. You can add advertising (like what many sites do these days), you can start charging for 'premium' features (the so-called freemium business model), or you can start requesting donations (wikipedia model).
Each of these different montization methods has its own pros and cons and each of them has a potential to piss of users and alienate them.
So the question that I have is: what is the best time to implement one of these features? Do you start charging/advertising from the beginning or do you wait for the community to grow on the completely free model?
1. You're more likely to piss of customers if you introduce advertisements/donation requests/subscriptions later than if it is there at the beginning. People like to know what they can expect from a site when they first start using it, and they tend to get very comfortable with a given dynamic. I've been very surprised how offended/alienated people can become if you introduce monetization later...people don't seem to understand about hosting costs or time investments.
2. You get the chance to see what is actually going to work for you before you go through too many iterations of your idea. Maybe your initial focus is not able to sustain itself...being able to adjust on the fly and experiment is a key component of internet sites and your monetization strategy is definitely something you can/should experiment with.
3. People with something invested in your site beyond their content contributions (such as donations/subscriptions) are more likely to give you honest feedback about your site. You also tend to get more partner inquiries if there is a visible monetization method (versus 'labors of love'.)