I disagree. Free is not something you can compete on sustainable manner. Eventually you will need to start making cash. It's quite a bold gamble betting that educating your market will eventually lead into customers.
Imagine if one guy looking for a free tool tells 10 other people about the free tool. you are going to end up with 11 people now using your tool. if it costs you to upkeep the tool for each customer, you've now mangified it by 10 fold. you start hoping that one of these customers one day will become a customer but are they really? you've sold them something free, it costs nothing therefore there's no reason to pay for it, ever.
It's not a bold gamble, educating your market is definitely taking into account as a cost of capital, from consumer electronics to, food, to tech startups. And it's definitely not about hope, there is a clear marketing strategy to get people to buy again. Just google free trials and samples, even supermarkets have been doing this forever, it's not a new concept.
This is because it is ALWAYS more expensive to get a new customer than keep an older one.
In software, the cost to onboard a new user is or should be insignificant. If you don't have this working for you, go back and try again.
If you build a small base of customers that absolutely love what you do, that's far more sustainable than building something that a lot of like what you do. Growth is more sustainable when you've built a product that can scale because it actually addressed a problem that is passionately shared by others. Think about the major successes that exist today...how did they start...then you'll have your answer.
The problem in your scenario is not that the word spread, but that the word that spread wasn't any good.