Ask HN: How to price a service that saves hundreds of engineering hours?

Counterpoint: I have personally seen companies of the size OP is talking about run into unexpected big jumps in spending on key infrastructure and tooling because they made some architectural change and then suddenly realised it was going to run the tests 10x as often or something. Without exception the response has been twofold. First they did take the immediate financial hit because they couldn't afford to be without a critical system. Second they diverted significant resources to getting the usage levels back under control very quickly so they didn't have to rework that critical infrastructure as well.

If anything, since bringing the costs of some important infrastructure down is exactly the problem OP's tool is solving and its value is directly demonstrable in terms of time and therefore money saved, your general argument should be a positive sign for OP that they probably have a viable business model.

I could buy an argument that tiered pricing might work better for OP than metered if someone showed up with data supporting the theory. But metered pricing seems to be working out pretty well for a lot of popular cloud-hosted dev tools and of course is almost universal among cloud infrastructure providers. People complain a lot about AWS having unpredictable pricing but I heard AWS has still had some success breaking into the cloud hosting market and probably it's making enough money that Amazon might keep it running. To be fair that's partly because although AWS lacks safeguards that would certainly be welcomed by many it does also have a reputation for being very decent about support in the occasional "Oh s@£t" scenarios.

What is your customer base and target market? Both pricing models and numbers will come out very differently for the same underlying technical work depending on if you're aiming for fewer how-much-could-a-banana-cost-biggies (these need service agreements and someone who they can talk to on a first-name basis) or a turnkey system for every startup and corporate using Cypress out there (they just register a credit card and e-mail and start integrating).

While you are considering your margins, you're going by value-based pricing here - you focus less on how much it costs you to build and run and your bottom line and more on how valuable it is to the potential customer. Some told you hundreds of hours were saved.

It sounds like you have the pricing model for a mass-market SaaS with the pricing for the high-end.

One risk with such high value-based pricing is that assuming initial success, some happy customers might get restless after a few weeks/months/years and realize that for the price they're paying you they could actually save money by building and rolling something similar in-house. The customers who are ready to pay those prices are precisely the ones likely to do it, I think. In any case, unless your market is super niche or you have some crazy edge, you will get competitors if you're successful enough. Maybe even straight-up copycats. This is nothing bad at all but it can be good to keep in mind that you may lose customers if they're able to slaughter you on cost-performance.

Also consider that these higher-end clients likely care a lot about availability and stability. If you don't have brand-recognition or a personal reference, it can be hard to convince them to take a shot. Free trials will never be enough for them to be confident either. Initial underpricing (not too much obv) is a way to compensate for that initially.

But again, I think we need more context before we can make a fair assessment of if the price is reasonable or not.

Market Pricing: what are your competitors charging.

Cost plus: What is your investment to date and what do you see ongoing marginal costs as, and what type of pricing do you need to make this worthwhile for you financially?

nearest substitute pricing: what’s the financial savings of your product versus the competitor? Charge a price that captures some of this value (what you’re proposing)

Also be mindful of Cypress possible taking steps to improve their own run times. What will you do to stay ahead and keep your marketshare? include this in your considerations as ongoing r&d.