Pricing strategy · Saas

How did you price your SaaS MVP?

Ravi Kiran Salestech Founder, Discovery Stage Investor, Business Model Mentor, #JTBD Fan, Ex Advg CEO @ravitwo

Last updated on January 25th, 2020

Question for founders who have priced their MVP and have picked up traction, how did you decide your pricing? How often did you iterate? What challenges or objections did you face and how did you overcome them? I am not looking for links to reading material, I know there is a tonne of that out there, but experience from real founders, specially if that experience is recent. Thanks in advance.

Paul Garcia marketing exec & business advisor

January 29th, 2020

You'll find the answer is "it depends" no matter whom you ask. Your marketing strategy validation should inform your pricing model, not your guess, not someone else's model. You ask real people, preferably people who would be your customers, what they're paying now to solve the problem, whether they feel they are getting value, and what value they wish they were getting but aren't.

Your price should be what the market will bear, based on the value you deliver. Whether you license by site, by user, by service level, or by size of enterprise, it doesn't help for someone to tell you what worked for their company. It only matters what works for your company.

Keep in mind that you can always lower your prices, but it's very hard to raise them. Deep discounting might feel good to get your early adopters onboard, but it also erodes perceived value. If you can survive selling for less money, then why would they want to pay more?

Your aversion to reading is disconcerting. Real founders write too, and often. If you aren't reading their discussions, you aren't getting a broader picture of the circumstances to watch out for, and you aren't learning their process.

The objections will be unique to your business, as will how you answer them. Remember, people don't buy based on price as the highest priority. They buy based on value. You can find countless sources of proof that this is so. Deliver enough value and customers will gladly pay the pricetag.