Should I offer a free tier?

Only if free users turn into paying ones through a path you can measure. Otherwise a free tier adds support cost and hides whether anyone would pay.

How often should I change prices?

Review pricing at least yearly, and change it when you have evidence from deals. Protect existing customers with notice, and let new pricing apply to new deals first.

The nine GTM dimensions

Pricing and monetization: charging for the value you create

Pricing and monetization is whether you charge in proportion to the value customers get, keep discounts in check, and package the product so customers can spend more as they grow, and it matters because price is the fastest lever on revenue and margin. Technical founders often underprice because the product was cheap to build.

Price on value, not on cost

What it cost you to build has little to do with what a customer will pay. Price from the problem: what the customer spends today on the problem, in money or hours, and what the product saves. Then test the price in real sales conversations, in writing.

Discount discipline

Discounts given to close a deal tend to become the price. Decide in advance who can discount, by how much, and in exchange for what, such as a longer contract or a case study. Track the gap between list price and what customers actually pay.

Packaging that grows with the customer

Pick a pricing unit that grows as the customer gets more value: seats, usage, accounts, or modules. Good packaging means a successful customer pays more without a new negotiation, which is what drives net revenue retention.

Key takeaways

Price from the value of the problem solved, not the cost to build.
Set discount rules in advance and track realized price.
Choose a pricing unit that grows with the customer.

Questions founders ask

Should I offer a free tier?: Only if free users turn into paying ones through a path you can measure. Otherwise a free tier adds support cost and hides whether anyone would pay.
How often should I change prices?: Review pricing at least yearly, and change it when you have evidence from deals. Protect existing customers with notice, and let new pricing apply to new deals first.

Score your company on pricing and monetization

Rate how well your price captures value, with the other eight dimensions, in a few minutes. Your own view, unsigned, to test against what customers actually pay.

Start your GTM Pressure Test

Free calculators for the numbers in this lesson, each with its formula and a worked example.