If Nothing Else – Segment Churn. You’ll See Patterns and Learnings You Wouldn’t Otherwise
Churn is not a GAAP metric. It doesn’t have a universal definition. Public companies and startups all seem to define churn differently. And even hide it in part, by doing so. I learned this myself starting out as a B2B CEO. I compared us to the only public...
Dear SaaStr: When Does It Make Sense to Price Low in the Market?
Dear SaaStr: When and how should SaaS startups offer reduced pricing vs the competition? For most B2B apps, you want to at least start with “just right”, Goldilocks pricing: #1. Too high a price, and you start to add friction to the sales process. Deals take longer,...
Salesforce Now Has 3+ Pricing Models for Agentforce. And Maybe Right Now, That’s The Way to Do It.
Salesforce has now shipped three different pricing models for Agentforce — in roughly 18 months. First, $2 per conversation when they launched. Then Flex Credits at $0.10 per action in May 2025. And now per-user licenses starting at $125/user/month with what Benioff...
Dear SaaStr: How Do You Change the Price of Your SaaS Product Without Upsetting Existing Customers?
Raise prices on existing customers,Doesn’t help if you are growing quickly. Just makes them unhappy. Raise prices on new customers,Forces you to deliver more value. Often makes everyone more happy. — Jason ✨👾SaaStr.Ai✨ Lemkin (@jasonlk) April 7, 2022 Dear...
Freemium is Back — The AI Edition! But You’ll Still Probably Need 50 Million Active Users for Freemium to Actually Work as a Business Model.
“For Freemium and PLG to work at scale, you probably need millions of folks to use your product. If it’s 1000’s … then go sell it.” Freemium is back. In fact, it’s never been bigger. The Age of AI is build on freemium. ChatGPT is the...
The $7,500 Migration Fee That Just Cost a Vendor $80,000 ARR. Really, $240,000.
I almost switched vendors today. After many, many years with our current solution, I was ready to make the jump. New vendor lined up. Budget approved. $80,000 a year contract ready to sign. Then I saw it: $7,500 migration fee. And just like that, the deal died....
Gartner: Enterprise Software Spend Will Grow a Stunning 15.2% Next Year. But Most Of That Will Go to Price Increases and AI Apps
Software spend will accelerate to a stunning 15.2% in 2026 per Gartner. It will remain the largest and fastest-growing segment of the $6 Trillion enterprise IT spent. A massive number with record growth – the biggest growth rate in the entire IT market. But before...
The Great SaaS Price Surge of 2025: A Comprehensive Breakdown of Pricing Increases. And The Issues They Have Created for All Of Us.
2025 has become the year of aggressive B2B pricing increases, with legacy and older vendors across the board pushing through some of the steepest hikes we’ve seen in years. So far, SaaS pricing is up by approximately 11.4% compared to the same time in 2024—a...
The Confounding Logic of Discounting
There can be nothing more frustrating in the middle-early days than when sales closes some great deal for, say, $125,000 a year … but you “knew” they could have gotten $200,000 if they just held the line on discounting. You’d talked to that...
Why I’m Scared to Buy New SaaS Apps Now
So many of you may find this ironic on SaaStr, but I’m scared to buy new SaaS apps today. Genuinely. Why? Let’s make a list. But the uber-reason is buying and renewing has in many cases gotten much less customer-friendly than it used to be. With one big exception:...
Will Buyers Ultimately Pay More for AI? Vendr’s Data Says … Maybe Not
So will buyers really pay more for AI? Or will they expect it to be included in the already in many cases expensive purchase price for the core product? We’re still learning. On the one hand, many players in the support space have clearly been able to charge...
Dear SaaStr: How Do You Price a SaaS Product in a New B2B Market?
Dear SaaStr: How Do You Price a SaaS Product in a New B2B Market? I’ve lived it. It’s not as complicated or as hard as it sounds. The simplest answer is usually to copy the pricing from the closest public company or other break-out leader you can find that is...
Dear SaaStr: What is a Good Refund Policy for a SaaS Product?
Dear SaaStr: What is a Good Refund Policy for a SaaS Product? SaaS startups, especially those that sign customers to annual customers, will have customers that want to cancel those un-cancelable contracts and get a refund. Even customers that pay monthly on credit...
Dear SaaStr: Which SaaS Products Offer ONLY Annual Pricing?
Dear SaaStr: Which SaaS Products Offer ONLY Annual Pricing? Many of the companies I’ve invested in only offer annual pricing. The common denominator is: they are products that require some real business process change to achieve the value from the product. and that...
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