Dealing with startups and financial models is one of the areas of discussion that always comes up in product pricing. What’s generally astounding is the lack of thought or time that has gone into the process. I know, I know, you’re busy building a product and can’t be bothered by such triviality. But, when it’s time to prepare a venture ready financial model, you’re going to need to input your pricing hypothesis into your pro-forma document. So let’s get to that hypothesis. But first:
- SAAS isn’t a price – software as a service is a delivery model (Compared to shipping boxes of software on disks).
- Freemium isn’t a price – it’s a go-to-market strategy that is designed to acquire customers and convert some percentage of these customers to a paid version of the product.
- In App Purchase isn’t a price – it’s a way to monetize the sale of virtual goods within a game. Continue reading “Startup Guide to Pricing your Product”