How should we price our startup?

http://www.redline.cc/welcome

by inprogress • 14 years ago

15 10 14 years ago

Hello Hacker News,

We need some help! We launched our startup Redline, http://www.redline.cc, into private beta a few months back. We are about ready to make it public and as part of that we want to introduce a pricing model. We have had some lively discussions about what to price it and how to determine if that is the right price but all our solutions feel like we are just guessing. The only thing we can agree on is that we have a free tier, a qa tier and a production tier. Beyond that, what should we set as the initial prices and how should we run pricing tests after that?

duiker1012• 14 years ago

It seems interesting, unfortunately while trying I got a 404 after submitting the test bug, I was really interested in seeing the part behind the scenes ...

inprogress3• 14 years ago

Thanks for giving it a try! Could you give me a little more info about the problem you saw? We just gave the system a quick test and everything seems to be working. If you have specifics please email me at doug <at> redline <dot> cc.

duiker1012• 14 years ago

I dropped you an email ;)

mixmax• 14 years ago

Some time ago I wrote a blogpost about how you can maximise the profit in your pricing using a bit of hacking.

http://www.maximise.dk/getting-product-pricing-right/

If you use the idea I'd love to hear about it.

inprogress3• 14 years ago

Cool, we will take a look and give you some feedback.

ainsleyb• 14 years ago

This looks a lot like BugHerd (http://www.bugherd.com). Might be worth looking at what they do?

luvablerasta• 14 years ago

i like the UI of redline better. Quick and easy integration. and free too :)

fieldforceapp• 14 years ago

Hi, for us, this would have been a great visual addition to the HTML preview features built into Beanstalk... http://beanstalkapp.com/features/collaboration

Maybe the Wildbit boys would be open to some affiliate program pricing for you?

cocoadev• 14 years ago

This is an interesting problem for a number of startups. Revenue generation is a vexing problem and one that I assume you will iterate over numerous times.

When thinking of online services there seems to be a few ways in which to generate revenue. Advertising, Subscription, per-click or data selling are pretty much the main revenue generation mechanisms. If we break them down and assume that user experience is key above all else for your product and brand then Advertising take a back seat. It doesn't seem as though your product really allows in concept a good space for throwing an add or two in the mix. Doing so would create an annoying an ugly experience for users. I don't think that it is entirely out of the question, however, you have or will have a group of users who are using your product as a tool. There is a good possibility they might need other tools to help get the job done as well. Sending weekly emails with possible tools a particular user might need would help generate advertising revenue.

Charging Per click or per use would also be super annoying and I don't recommend it at all. A low priced subscription model which allows unlimited use gives the user the ability to interact with your product without the unpleasantness of ads or paying "per-click". The actual price for the service should be looked at closely and iterated over several times as adoption becomes higher.

The last item on the list is data selling. You can track what your customers are doing what they are interacting with and make some assumptions on why. I'm sure that there are a number of people who are super interested in that data and would be willing to pay for it.

I hope that helps answer your question.

inprogress3• 14 years ago

That does help! What would you suggest that we start the initial prices at?

How should we price our startup?

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