Do not sign a contract with Snowflake

Throwaway to share a cautionary tale about contract chicanery with Snowflake to protect our ID. In mid-2019, I started testing DWH providers for our small data stack. Did the free trial for on demand Snowflake after hearing how it is suited for smaller use cases. After a few months of using it, we had bills in the low hundreds range/month. Their sales rep reached out to sell us on a contract where we pre-purchase $10k credits on a yearly contract (their lowest contract at that point) where we can roll-over any un-used credits next year. I will emphasize here that the sales conversation, rep never mentioned anything regarding new purchases requirements with the roll over, and in fact portrayed it as a paperwork process to just continue the credits. The actual contract clause is pretty vague and just says unused capacity will roll over into the next contract.

Fast forward to now, we need to do our roll-over contract for our unused credits, which due to covid, we have over 90% unused credits because we had to prioritize other projects. Rep reaches out and informs us that we need to sign a new contract for $1k min. to roll-over our 9k credits and we would lose the 15% discount on the unused credits. Losing the discount is one thing, but having to purchase more just to keep what we have purchased was not at all how this roll-over process was portrayed at signing. The rep then said in fact there is a worse policy for newer customers where unused credits will only roll-over if you renew at the same price or greater only. I should count myself lucky that they had the decency to enforce this policy rather than their other arbitrary policy that is not mentioned anywhere.

If you are considering contracting with them and they are promising all these great things about discounts and roll-over, don't do it. I guess since their IPO, they no longer care about their smaller customers. There has been some chatter on HN about how Snowflake is worth so much, well...here you go.

I don't have any experience with them but I went to the pricing section on their website[0] and was greeted with very large all-caps text:

PRICING: WHY PAY FOR WHAT YOU DON’T USE?

PAY FOR THE COMPUTE AND STORAGE YOU ACTUALLY USE.

I found that pretty funny given the problem you're running in to.

[0] https://www.snowflake.com/pricing/

Reminds me of Audible's bullshit premium. If you cancel the premium, you lose the credits almost immediately.

Not to condone their approach but in the SaaS subscription business, any renewal that yields less revenue than the previous term is treated as churn (for the difference in value).

With churn being of the metrics that affects investors dynamic and thus valuation the most, I understand their desire to eliminate these situations.

Enter negotiations and at the end of the day, vote with your dollars.

I wish that along with that a lot of these vendors were happy to start small.

I've found a trend where SaaS vendors will only sell licenses in bundles that are either way less or way more than anyone needs, pushing to start the relationship with you overprovisioned.

Then at renewal time there's pressure to add more licenses and you're still not using all of the ones you have.