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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.
Head of AI Dialpad: How to Build AI at Scale GTM/ B2B Speakers: CEO HubSpot Yamini Rangan: Going More Multiproduct, Going More AI, and Going More SMB and More Enterprise CEO Dropbox Drew Houston: DropBoxs Third Act: AI & Content Intelligence CEO Calendly, Tope Awotona Open AMA and AI in 2026 CEO Clio, Jack Newton: Reaccelerating Vertical SaaS to (..)
If you’re selling software to SMB merchants and outside of tech like Shopify and Toast and Monday , things are pretty, pretty good, if in some ways still harder than before. On top of that, inflation and price increases are eating into overall IT budgets. Growth in public cloud services (AWS, Azure, Google Cloud, Snowflake, etc.)
What lessons can we learn from this huge Kiwi SMB success, for other founders? ” So even in SMB sales in smaller markets, if you take dominant market share — you can get to $500m+ in ARR! ” So even in SMB sales in smaller markets, if you take dominant market share — you can get to $500m+ in ARR!
Right now, you may have 3-4-stage sales processes that work for SMB customers. Everything you have now will probably look different upmarket, including pricing. Pricing is a big one. You have your pricing strategy for down-market customers, such as how you price the bundle, packaging, etc.
It’s worth pointing out that Azure is a bit above the long term trendline, while AWS is still below (but accelerating up). For businesses selling predominantly to SMB customers, these benchmarks are all slightly lower given the higher-churn nature of SMBs. However, it’s still a fun data point to track.
Customers range from AWS skills-builder platforms with billions of users to Zoom using it for customers and employees. They started via SMB and are now serving the Amazons of the world. Folks need to figure out ways to add incremental improvements to pricing, and the only way to do that is to think deeply about how you’re doing it.
So to serve both segments at the simultaneously, ZoomInfo has been rolling out a Product-led sales motion, that gives the ability for an SMB customer to sign up directly on their website for a free trial and grow into a paid customer, without ever having to talk to an sales rep or go through a demo process.
And it’s one of the three large cloud vendors that we all know: Microsoft, AWS, and Google. AWS’s marketplace has seen 1.5 But also it’s allowed us to get much closer to our provider, I mean, we host and run 100% on AWS, but pull data from everywhere. It was pretty easy to drive that from our side.
The other thing that dropped our odds of success was the fact that we were focused on small business, on the SMB market, and everyone we talked to, literally everyone. Do not…,” and the reason is no one hardly ever has succeeded in building a big business in SMB. ” “Yep, we need a price.”
This has all resulted in the median stock price declining 5% YTD. It looks at the YoY dollar change in quarterly revenue from the hyperscalers (just looking at Azure / AWS because the data goes back further) going back a few years. I consider >120% best in class for companies selling to SMBs (like Bill.com).
Patrick Campbell’s got thousands of SaaS companies and pricing and issues. Then, we’ll end of the day with me and Stewart Butterfield and obviously Slack is doing well, but Slack also has a massive SMB base and its challenges. We can save companies $100,000 on their AWS bill. That’s how it all works.
For SaaS businesses that target smaller SMB customer segments, gross retention is typically in the mid to low 80’s with net expansion in the ~105% range. This is why the consumption players (Snowflake, Mongo, Confluent, Azure, AWS, etc) so more variability in the macro slowdown. Buyers are also experimenting on vendors.
They did call out sequential growth in Confluent Cloud every quarter this year which was a big positive Still seeing elongated deal cycles and less expansion revenue The Bad AWS: Headwinds Getting Worse Their quarter ended in March, but on the earnings call they called out weakening growth in April.
It was around that time about 12 years ago that Jeff Bezos launched AWS, and some of you may remember that, when he did this, Wall Street analysts were looking at him and saying, “Why would you take what’s already a very unprofitable business and drive it further into the red by investing in this AWS initiative?”
Maybe endless price increases,” Jason says. You can see the growth on the platform side with Azure, Google, and AWS and how much it’s accelerating in AI. They’re very SMB and just closed their first $750k TCV deal. The chart estimates spend will grow 20% to $675B. If we’re adding 20%, where is the money going?
Consumption-based pricing is best used when you can accurately and easily break down your service offering into small, digestible units. Many companies in the technology industry are moving toward “pay for what you use” consumption-based pricing models. Four pricing models. Uncommitted contracts. Challenges and shifts.
Then we went on to build another company called SteelBrick, another SaaS configure price quoting solution. And G2 Gives, we partner with philanthropies, we partner with some of our customers like AWS and Google Cloud, who can then make donations for every review, to thank their customers. It’s most severe in the SMB world.
Usage-based pricing (UBP) , also known as consumption-based pricing, allows customers to pay for products according to how much they use. AWS and other infrastructure providers have been using UBP for nearly a decade. OpenView’s Blake Bartlett advises that continuous experimentation can drive down CAC.
The answer likely depends on your market segmentation, as freemium may ease adoption friction for SMB/mid-market companies. You can often see these types of feature segmentations detailed on open-source pricing pages, as with GitLab and HashiCorp. Are you targeting enterprise or mid-market/SMB?
But if you target SMBs or consumers, PLG is a fantastic way, and you have a very large user base to reach out to as well. If you have a very complicated product–for example you sell AWS or you sell Snowflake–those are infrastructure products. The pricing for SaaS is much more complicated. should you be focusing on first?
With a background that includes leadership roles at AWS, Microsoft, and Lenovo, Fred brings a wealth of experience in building high-performing teams and driving revenue growth. And I know you’ve had some great experience, particularly while you were at AWS, running different partner sales, channel sales. They cannot resell.
And I remember being at that Dreamforce in 2009, which was awful. ” I’m like, that sounds awful. SMB numbers are harder to get with, but it’s like 60 or 70 for SMBs. And every vendor was just staring at each other like the world’s dead. I mean, literally. Every retail shop was closed by 2000.
I’m going to get the numbers wrong, I think Amazon has 10,000 open positions out in AWS. Salesforce was a very rudimentary SMB app for a brief period of time, but it was. Frankly, product and even engineering, marketing, and sales are all pretty darn similar at a price point. I think Azure’s like 7,000, Google.
” Is it something beyond just “we want bigger deal sizes to make our unit economics work” or do they feel they have a strong product market fit and can actually command those prices. Seth Hammac , Global Partnerships & Alliances @ AWS Ok so what CAN you do to set yourself up for success?
It took me a long time to admit to myself that I don’t enjoy transactional SMB sales. Option 1: Early in my career, I was asked my opinion about enterprise pricing for a new product. Laura leads and empowers a team that never stops shattering revenue goals at the number one price reporting agency in the protein space.
” Head of AI Dialpad: “How to Build AI at Scale” GTM/ B2B Speakers: CEO HubSpot Yamini Rangan : “Going More Multiproduct, Going More AI, and Going More SMB and More Enterprise” CEO Dropbox Drew Houston : “DropBox’s Third Act: AI & Content Intelligence” CEO Calendly Tope Awotona “Open AMA and (..)
Be like, "And we got it at a fantastic price." Dharmesh: Which you can take the number of shares, which is on the public record and multiply it by the current price and get. You don't really need to check the prices when you go do things. And then I met Brian in grad school and we both have this kind of shared passion for SMB.
Pricing? * Harry Stebbings: Is it also challenging in terms of pricing, given the fact that one has to have consistent pricing, but also you might actually not have optimal value extraction for the product dependent on who’s using it and what sector they’re in. I think our pricing strategy will continue to evolve.
Be like, "And we got it at a fantastic price." Dharmesh: Which you can take the number of shares, which is on the public record and multiply it by the current price and get. You don't really need to check the prices when you go do things. And then I met Brian in grad school and we both have this kind of shared passion for SMB.
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