the better business model?

Hello fellow warriors,

which is the better online business model would you say -

While studying and learning from Frank Kern. I gathered that in his niche business/s he used to build a list by giving away something for free
(nothing new there..)
but he wouldn't take leads straight to a sales page. He would just give a free value offer on the front end, cultivate that list, provide value to the list and help them, then promote his paid offer/s to that list and do product launches ect.

Now we all know Frank Kern is a special case with marketing. But is that a better business model then say the regular sales funnel..

While also learning and studying from Alex Jeffreys I found out about sales funnels like:

traffic - free value offer - then to paid product/sales page - to upsell/s and all that good stuff.

Which would you guys who have sales funnels in place or those that have just focused on list building,giving value then promoting stuff, say is the better business model?

1) focus on list building with free value offer - cultivate list and then promote paid offers/ your own products ect?
2) regular sales funnel, while still giving value and selling upfront good value stuff?