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The Complete Guide to SaaS Pricing Strategy

Tom Tunguz

Most startups play defense when discussing pricing with customers. They use pricing as an offensive tool to reinforce their product’s value and underscore the company’s core marketing message. For many founding teams, pricing is one of the most difficult and complex decisions for the business.

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Half of You Are Planning to Raise Prices in 2023

SaaStr

HubSpot for example, which has been very judicious on holding the line on pricing and ACVs, raised prices 12% for the first time since 2018 — albeit only on new customers: Slack also similarly did its first pricing increase in history recently, of about 10%: Prices are going up in SaaS. And 2 Better Ways to Do It Anyway.

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5 Interesting Learnings from Klaviyo at Almost $1 Billion in ARR

SaaStr

It was the only SaaS IPO on 2023. But SMBs in the middle have become more cost and price-sensitive. #10. So the latest SaaS leader to cross $1B ARR is Klaviyo. Klaviyo dominates marketing in the Shopify ecosystem and in ecommerce, and just keeps on scaling. The only one! ” 5 Interesting Learnings: #1. SMB Weaker.

Scale 301
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5 Top Learnings from Legal SaaS Logikcull’s Almost $300,000,000 Sale to Private Equity

SaaStr

Andy had to completely reboot the team to reignite growth, pushing past $30m+ ARR by 2023 and selling to a top private equity firm. But Andy got 3 other firm offers through the bank he hired — along with a price more than $10m higher. They got several offers in 2021, then a pause in 2022, and the offers came back in 2023.

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The Hardest Round to Raise in 2023

Tom Tunguz

The hardest round to raise so far in 2023 is the Series B. Seeds peaked at 1500 in Q1 of 2020 falling to 155 in Q1 of 2023. First, the market hasn’t yet determined the clearing prices for Series B companies. The new pricing norms, the multiples of ARR which declined from 100x ARR , aren’t broadly accepted.

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The Typical Startup Saw a 24% Increase in Sales Cycle in 2023

Tom Tunguz

Sales cycles shifted dramatically in 2023. The average startup saw a 24% increase in sales cycle from early 2022 to 2023. And yes, enterprise focused companies with usage based pricing models have borne the greatest overall increase of 44%. The data analysis uses the results from the 2023 GTM Survey.

Startup 350
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76% of You Are Raising Prices in 2024

SaaStr

Are we thought the endless price increases we saw in 2023? A stunning 76% of you are raising prices in 2024. That’s up from 54% in 2023. Personally, I’m a fan of only raising prices if you’ve earned it, and focusing on raising prices on new customers, not just the base. Apparently not.

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