4 ms·
The era of startups charging below fair price (to deliver the service) in pursuit of "growth" comes to an end. This was the end game for lot of these companies
by npalli 3y ago
The era of startups charging below fair price (to deliver the service) in pursuit of "growth" comes to an end. This was the end game for lot of these companies working in the ZIRP environment from 2009-21. Underprice your service, lock in customers to your service, hope it will be too difficult to migrate away, when dust settles jack up prices to reach fair value, of course if everything fails, sell to a large company who will not have a problem enforcing. We will begin to see waves of these re-pricings as VC funded subsidies comes to a close.
- aenis 3y agoMaybe. Or maybe the price of passing the cost of internal bloat to the customer is coming to an end? Look at their gross vs net margin. Where is the money spent? How much engineers vs. non engineers do they employ? Did they acquire naming rights to a stadium? My company was just hit by an egregious 6.5x price increase from one of those managed open source companies. A cool $7m per year delta. We will feel sore for a year, since we were told 2 months in advance of the new pricing, and we will migrate off it easily for the demonstrable ROI. I didnt even need to ask the C suite for the migration money, they were so pissed.