Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The 5$ SaaS

alpblog.heroku.com

Post reply on HN
Print view View original

21–30 of 39 posts

Re: The 5$ SaaS

#21

Post by damncabbage »

6ren wrote: post #14
sondh wrote: post #4

He mentioned the github $5 plan however I always pays $7 each month since the beginning. I checked github pricing[1] and it's showing the micro plan starts at $7/mo. Is there a lower plan by buying in bulk, paying annually or else? [1] https://github.com/plans

I have a free account on github, but I must be a terrible customer, because starting from my account, it took about 8 clicks to find the pricing information. I ended up having to go through the FAQ, and one question happened to link to the plans. Either that, or github has very relaxed attitude about sales. Maybe they only alert you to it when you attempt an action that requires an upgrade (e.g. too many repositories…

It tells you about paid plans whenever you go to create a new repository, and on the front page when you're logged out, but otherwise, yeah, it's pretty obtuse if you're an existing user.

Re: The 5$ SaaS

#22

Post by mattmanser »

fmavituna wrote: post #13

Although it's one of the worst models for startup. If volume is possible that means too many players in that market. Startup is already a risky business, why make it even harder by going into a space where you have to fight with lots of other big / small / medium players?

What a load of utter nonsense. Many of HNs favourite startups operate in saturated spaces.

Re: The 5$ SaaS

#23

Post by jacques_chester »

Availability bias. There are many SaaS companies making many different offerings.

Choosing $5 as your price point because everyone else does it, or because you think it would be an easy sale, or because you feel bad about asking more, is stupid.

Don't do that[1].

Give pricing a tenth of the care and attention you give to your code. Because it is the single most important lever of profitability you will ever control, and it is much easier to pull it before you launch than afterwards.

[1] http://chester.id.au/2012/09/12/review-the-strategy-and-tact...

Re: The 5$ SaaS

#24

Post by nicholassmith »

fmavituna wrote: post #17
riffraff wrote: post #16

Earlier quoted context omitted.

isn't there something to be said for "a smaller slice of the bigger pie" ?

It applies to certain things but I don't think that applies to $5 SaaS. Because to be sustainable you'll need 1000-5000 customers, even though those numbers can be small in that big pie, it's still extremely hard to reach and support. However you can easily get a smaller slice of the bigger pie in an enterprise market with 20 customers instead of 5000, and that's much easier to accomplish. This model seems more suita…

Depending entirely on how you structure and how much you want to get out of it $5 a month with 2000 core customers is $120000, minus operation costs like servers and such. Not an unhealthy amount of money if the time you need to invest in the product each month is relatively low.

Re: The 5$ SaaS

#25

Post by netcan »

The the relatively recent rise of two big types of software pricing & distribution is a opportunity to notice how different things in markets interact in these markets. If you spend your career in software you forget how weird an industry with n marginal costs is.

An app store lends well to $1-$10 apps creating a demand creating a supply.

Web based Saas lends well to $5-$50 apps creating a demand creating a supply.

If you need a sales consultant or a long decision making process you need to go into the 5-6 figures realm.

These things didn't happen because consumers really wanted smartphone apps that happened to cost around $1 or webapps that happened to cost $5 per month. The marble dictated the sculpture

Consumer webapps need to be sold as monthly subscriptions. Subscriptions have a customer decision making and vendor responsibility overhead that makes $5 roughly the lowest possible price, so you naturally get the "cheaper" apps bunching around the lowest viable point.

B2B web apps/services were able to crack into a price range that was inaccessible before. $1500 one off payment for a shrink wrap version is too expensive for self service sales & too small for a sales teams. $99 p/m with 30 days free isn't. Whole programming cultures formed around this new opening.

Re: The 5$ SaaS

#26

Post by fmavituna »

mattmanser wrote: post #22
fmavituna wrote: post #13

Although it's one of the worst models for startup. If volume is possible that means too many players in that market. Startup is already a risky business, why make it even harder by going into a space where you have to fight with lots of other big / small / medium players?

What a load of utter nonsense. Many of HNs favourite startups operate in saturated spaces.

Survivor bias?

Re: The 5$ SaaS

#28

Post by impostervt »

I priced my side project at $5/month, because it was the lowest amount of money that made it worth doing the work.

I did A/B testing before I started charging, and there was no difference between charging $12/year, $3/month, $4/month, and $5/month. Which is crazy, but it reached statistical significance according to optimizely. And fewer customers for the same money sounded good to me.

Re: The 5$ SaaS

#29

Post by bdunn »

andrewkkirk wrote: post #12

Most of my paid SaaS plans are closer to the $9-$19 dollar per month range. Examples: Freshbooks, HootSuite, MailChimp, KISSmetrics, Dropbox

And all of the above are B2B products, whereas the OP described B2C products.

That's a very important point to make: There's a comfort zone of about $5 a month that the typical consumer will pay for SaaS software. There really is no cap for businesses, as it's much easier to gauge the ROI of software that eliminates a position vs. software that tracks your runs.

Re: The 5$ SaaS

#30

Post by scott_meade »

impostervt wrote: post #28

I priced my side project at $5/month, because it was the lowest amount of money that made it worth doing the work. I did A/B testing before I started charging, and there was no difference between charging $12/year, $3/month, $4/month, and $5/month. Which is crazy, but it reached statistical significance according to optimizely. And fewer customers for the same money sounded good to me.

Why price at the lowest amount that makes it worth it instead of the highest amount that people will pay? Said another way, did you test $6/month, $10/month, $20/month?
Post reply on HN