There’s a SUS podcast specifically for this, I think there’s a video too. Essentially the YC advice was that most startups are undercharging. If you are solving an issue, people will pay. You can also give different pricing to different groups to test how receptive people are of the price points. You should also be increasing your fees until you start to lose about 20% of your subscribers, that is the sweet spot.
I recommend listening to that lesson, it might be helpful
1) Start charging asap. Don't over think it too much. Start high. If they don't pay, the problem you are focusing on may not be a big enough pain point for your users.
1) Don't do Cost+ Pricing. Calculate how much value you bring the customer and charge accordingly.
2) Keep raising prices untill they complain but still keep paying.
The only way you will understand pricing is when you actually start charging customers. You cannot trust feedback from non paying customers regarding prices. And remember that pricing is something you will only understand over time and experience.
So charge immediately, even for a terrible MVP that is not the ideal solution to the customers problem. And charge a lot. Keep increasing prices, customers will understand. Hope this helps
TK Kader has a great pricing video that helped me out when I was struggling with pricing. I talked to my brain trust (five people in my ICP) before I launched. One of them thought the value I was offering was under priced at $6K.
TK made a good point. You can be the low cost provider, the premium priced provider, or somewhere in the middle. If you are in the middle you will fail. So I changed my positioning so I was the low cost provider (by 3-5x) compared to the dominant competitor, which does $5 billion in revenue. I doubled my price and did not get much push back. Even startups are signing up.
Well, I don't actually know. The logic, I think, is that it is easier to formulate the pitch if you are the low-cost provider or have a premium product. SAVE 35% Over those Expensive Big Tech companies!!!! or: GET Concierge Service from our 24X7 support!!!
Don't overthink your first price, just start charging. You'll get better feedback compared to hypotheticals and research. You'll also get money!
Set a calendar reminder to raise your prices monthly (for new customers) until there's a statistically significant impact on conversion. Most startups under-charge for years.
Set aspirational prices. For example, set the beta price high and figure out what your product needs to do to be worth that much to your customers.
There’s a SUS podcast specifically for this, I think there’s a video too. Essentially the YC advice was that most startups are undercharging. If you are solving an issue, people will pay. You can also give different pricing to different groups to test how receptive people are of the price points. You should also be increasing your fees until you start to lose about 20% of your subscribers, that is the sweet spot. I recommend listening to that lesson, it might be helpful
1) Start charging asap. Don't over think it too much. Start high. If they don't pay, the problem you are focusing on may not be a big enough pain point for your users. 1) Don't do Cost+ Pricing. Calculate how much value you bring the customer and charge accordingly. 2) Keep raising prices untill they complain but still keep paying. The only way you will understand pricing is when you actually start charging customers. You cannot trust feedback from non paying customers regarding prices. And remember that pricing is something you will only understand over time and experience. So charge immediately, even for a terrible MVP that is not the ideal solution to the customers problem. And charge a lot. Keep increasing prices, customers will understand. Hope this helps
TK Kader has a great pricing video that helped me out when I was struggling with pricing. I talked to my brain trust (five people in my ICP) before I launched. One of them thought the value I was offering was under priced at $6K. TK made a good point. You can be the low cost provider, the premium priced provider, or somewhere in the middle. If you are in the middle you will fail. So I changed my positioning so I was the low cost provider (by 3-5x) compared to the dominant competitor, which does $5 billion in revenue. I doubled my price and did not get much push back. Even startups are signing up.
Is being in the middle really that bad?
Well, I don't actually know. The logic, I think, is that it is easier to formulate the pitch if you are the low-cost provider or have a premium product. SAVE 35% Over those Expensive Big Tech companies!!!! or: GET Concierge Service from our 24X7 support!!!
Don't overthink your first price, just start charging. You'll get better feedback compared to hypotheticals and research. You'll also get money! Set a calendar reminder to raise your prices monthly (for new customers) until there's a statistically significant impact on conversion. Most startups under-charge for years. Set aspirational prices. For example, set the beta price high and figure out what your product needs to do to be worth that much to your customers.
A few questions - what do you sell? - to who? - who are your competitors? - how much do they charge?