@donnacha | WordSkill - The license key for Gravity Forms is entered once on the Settings page of the plugin and it is then hashed and stored in the database so that other users with admin access cannot see your license key.

The license key then comes into play when WordPress checks for plugin updates. Automatic upgrades are only available to users who purchased the plugin. When WordPress cron job runs to check for plugin updates, it pings our update server to check if an update is available and passes your hashed license key as part of the request. If the key is valid and an upgrade is available, automatic upgrade takes place just like plugins from the repository.

The license key is also tied to our support system. It helps identify you as a customer. When you register on the support site it knows if you are a customer because your email is tied to your license key. So it then unlocks areas of the site that only customers have access to.

You enter your license key once, most likely the first time you activate the plugin. Not being able to reach our update server does not prevent the plugin or forms from working. It just prevents automatic upgrades from taking place if one is available.

A valid license key also automatically removes the "Buy Gravity Forms" message that appears in the admin side of the plugin when no license key is present.

As for the demo not fully showing what the plugin can do, unfortunately its very difficult to provide an online demo of the plugin that gives users full access without.... giving users full access. We did what we could given the security issues. If we made it wide open, a small percentage of users would end up purposely causing problems with the demo WordPress install and it's just not worth the headache. That is why it is locked down.