n8n Automation Is Not As Free As It Looks: A Strategic Breakdown For Companies
Many teams adopt n8n assuming it is free and open-source for any use case. The licence says otherwise. This article explains the real business limits behind n8n automation.
Why n8n Looks Like the Perfect Escape From SaaS Automation
n8n became popular fast because it promises everything teams feel locked out of in traditional automation tools self-hosting, source code access, no task limits, full control, and no vendor pricing model based on clicks or workflows.
That pitch created one core assumption n8n equals open-source freedom. The licence says otherwise.
n8n is not MIT, not Apache, not GPL. It runs on the Sustainable Use License, a restricted fair-code licence. That difference matters the moment automation moves from internal use to revenue use.
What n8n Actually Allows vs What Companies Think It Allows
The platform is legally safe when automation stays inside the organisation.
Internal workflows, internal users, internal data. No licence conflict.
The moment automation becomes a value proposition for external users, the licence blocks it.
Allowed without commercial licence
• Internal workflows for your own teams
• Self-hosting on your own servers
• Source code modification for in-house use
• Proof-of-concepts and internal RPA replacement
Not allowed without a commercial licence
• Embedding n8n inside a SaaS product
• Reselling automation as a service to clients
• Letting external users trigger workflows
• Using n8n as the engine of a platform you charge money for
Short version
n8n is free to use, not free to monetise.
Comparison Table: When n8n Works vs When It Breaks
| Use Case | Licence-compliant? | Needs paid contract? | Risk |
|---|---|---|---|
| Internal workflow automation | Yes | No | Low |
| SaaS product powered by n8n | No | Yes | Very high |
| Agency selling automation to clients | No | Yes | High |
| Customer portal where users trigger flows | No | Yes | High |
| On-prem automation inside a private network | Yes | No | Low |
| Hosting n8n for paying users | No | Yes | Extreme |
| Paid integrations built on n8n backend | No | Yes | High |
| Internal RPA alternative with no resale | Yes | No | Low |
Companies don’t get sued for technical misuse.
They get blocked when revenue depends on the engine they don’t have the right to sell.
The Hidden Cost of “Self-Hosted Freedom”
Teams adopt n8n thinking it unlocks infinite scale without SaaS pricing.
Then reality arrives.
Running n8n at scale requires:
• workers and queue management
• retries, error-handling, execution logs
• monitoring and alerting
• horizontal scaling and failover
• upgrades and dependency patching
• security, isolation, backups and rollback plans
You don’t just “self-host n8n”.
You operate an automation infrastructure.
Zapier and Make hide that cost, n8n hands it back to you.
Where n8n Is the Right Tool
n8n is a strong strategic choice when:
• automation stays internal
• data cannot leave the organisation
• development and DevOps capacity already exists
• workflows enhance operations, not revenue streams
In those cases, n8n is flexible, defensible and cost-effective.
Where n8n Becomes a Liability
n8n becomes the wrong tool when:
• automation is part of what you sell
• external users trigger workflows
• your product depends on a workflow engine you don’t own
• your future business model requires resale, white-label or embedding
At that point, the limitation is not technical it’s contractual.
The Real Question Is Not “Can It Automate?”
Zapier and Make sell execution.
n8n sells conditional permission.
Only true open-source engines let you own both code and commercial rights.
So the right question is not
“Can n8n build this workflow?”
but
“Are we legally allowed to scale this business model on top of n8n?”
Alternatives With Full Commercial Freedom
Windmill — open-source, code-first, licence-clean
Activepieces — open-core, transparent terms
Node-RED — mature, fully open, user-owned
Make / Zapier — no hosting, predictable cost, no licence audit later
Different tools remove different forms of risk.
The smart choice depends on the business, not the feature list.
How Scalevise Approaches Automation Architecture
Scalevise selects automation platforms based on:
- legal ownership and licence rights
- scaling behaviour under load
- total cost of operation, including DevOps
- exit strategy if the vendor or licence changes
- alignment with future product and revenue plans
The best automation stack is not the one that works today
it’s the one you still control when the business succeeds.
The Takeaway
n8n is not a bad platform.
It is a misunderstood one.
It works extremely well for internal automation.
It fails strategically when companies treat it as a free commercial engine.
It saves money when used correctly.
It creates hidden debt when used as the foundation of a product it is not licensed to power.
Use n8n with intention, and it delivers.
Use it on assumption, and it will cost more to unwind than it ever saved.
Book a Consultation
If you want expert guidance on automation architecture, licensing risks or platform selection, you can book a strategy session with Scalevise.