Price so it's interesting

If the entry price for your B2B SaaS is $20/mo and your max price is $200/mo, new customers won't be very impactful on average. At that price point, each new customer will add so little revenue that growth will be slow — and over time will become uninteresting.

The only way low prices are interesting is when you have distribution. But most don't have distribution, especially early on — and most won't ever reach the level that actually makes it interesting.

Almost a decade ago, I started at $9/mo. Not because the product was only worth that, but because I was desperate for customers.

And being "desperate" is not inherently a bad thing! — most founders go through a desperation phase. You need users, you need customers — you need any kind of validation. It's a normal phase.

But pricing too low doesn't make those things easier, and it often leads to focusing your efforts on the segment of your market that values you the least. You trade higher volume for higher churn.

And more customers and more users equals more work. But not more interesting. Not more meaningful. It's also worth understanding that "desperation" isn't an invisible signal to the market.

In B2B, like it or not, price is always a signal:

1. Set price too low and you communicate that the problem isn't important, i.e. it lacks value, or that your specific solution lacks quality or that it's only for the "littles."
2. Set price too high and you communicate that the problem you're solving is one that most don't have — that your solution is only for the "bigs" — even if that isn't true.

In the beginning, I was scared I'd fall into that "too high" camp even at $20/mo. I was naive. But I barely had a business at the time, so that $20 felt like a lot to me. But over time I realized higher pricing is about aligning price with value, and aligning product with market.

And for me, it's also about aligning my interest.

If I pay $100/mo to keep the office stocked with coffee, why wouldn't someone else pay $500/mo for software that saves them hours of work every month, or keeps their business running?

I remember there was a point a couple years ago when I was paying more for Keygen's status page and an underused affiliate system than I was charging for the mission-critical product that Keygen had become. There was a moment when I asked myself why I was pricing myself so low, and I asked myself what effect that choice had on how my customers and users, i.e. my market, perceives Keygen.

I didn't like my answer, so I changed things.

I used to believe the whole "don't let anybody overpay you" bit, but then I decided to stop worrying about a problem that somebody else told me about but one that I hadn't experienced myself.

I stopped worrying that letting people "overpay" me would "turn me into a consultancy." I don't let people dictate my vision, so why would I let them dictate my price? A higher entry point attracts the people I enjoy working with and makes every new customer impactful to me.

If I were to start something new today, but that idea can't support a $500/mo+ entry point, I probably won't pursue it. Spending another decade chasing volume on low prices isn't interesting to me.

Price so it's interesting. Interesting to the market because it signals value. Interesting to you because it makes everything "worth it."

If it's not interesting, why bother? If it's not interesting today, why not change that for tomorrow? Align your interest.