Price and package it

Pick a first price, then change it later without losing the customers you have.

4 steps, 64 questions underneath

1. 1
   Pricing and packaging

   What to charge, what to charge for, how to package it, and how to change it later without losing people.

   I have no idea what to charge. How do I pick a first price?

   The gist Find the right order of magnitude first and stop arguing about the exact number. Are you a ten dollar product, a hundred dollar product, a thousand dollar product or a hundred thousand dollar product? That decision follows from who buys, what budget it comes out of, and what they do today instead. Bound it from below by what it costs you to serve a customer and from above by what a heavy user is worth. Most early founders underprice badly, so if nobody has flinched at your price you are almost certainly too cheap. Announce pricing as late as you sensibly can, and build the product so pricing can change without an engineering project.

   ✍️ The Price Is Right: And for Early-Stage SaaS Companies, It Needs to Be The bounding method for a first price (cost to serve as the floor, cost of a heavy power user as the ceiling) plus the advice to keep pricing chang... 16 questions on pricing and packaging →
2. 2
   Who you sell to

   Picking a customer worth chasing, and knowing early when a deal is not one.

   What is an ICP and how is it different from a persona? People use both words for the same thing.

   The gist An ICP describes the company you want as a customer: size, industry, what they already use, what has to be true for your product to matter. A persona describes the human inside that company: their title, what they get judged on, what makes them look good or bad. You need both and they do different jobs. The ICP tells you which doors to knock on, the persona tells you what to say when someone opens. A useful ICP is uncomfortably narrow and written as filters you could actually apply to a list, not as adjectives like 'modern' or 'fast growing'.

   📰 Defining our ICP is the most important thing we ever did A real company showing its ICP before and after, including the messy middle where they were guessing. The point that narrow ICPs beat broad ones, a... 16 questions on who you sell to →
3. 3
   Expansion, upsell and churn

   Growing revenue inside accounts you already have, and stopping the leaks.

   What is net revenue retention and why does every investor keep asking me for it?

   The gist NRR is what happens to the revenue from one group of customers over a year, with no new logos counted: start with what they paid, subtract what churned, subtract downgrades, add upgrades and expansion. Above 100 percent means the customers you already have would grow your revenue even if you sold nothing new. That is why investors care. It is the single number that tells them whether your growth needs to be bought every year or whether it compounds. Enterprise SaaS is usually judged good around 110 percent, consumer SaaS much lower, so ask what benchmark you are being held to.

   📄 Net revenue retention (NRR): What is NRR and why does it matter for SaaS businesses? The formula written out term by term, with the three performance bands. The right first read if you have been nodding along in NRR conversations wi... 16 questions on expansion, upsell and churn →
4. 4
   Forecasting and GTM metrics

   Pipeline coverage, stage conversion, CAC payback, magic number, and calling a number you can defend to a board.

   What is pipeline coverage and how much pipeline do I actually need to hit my number?

   The gist Pipeline coverage is qualified open pipeline divided by the target for the period, and the honest answer to how much you need is one over your win rate. The famous 3x rule comes from a time when good B2B teams closed about a third of qualified pipeline. If you close twenty percent, you need five times coverage, not three, and using the rule of thumb instead of your own number is how teams cheerfully walk into a miss. Two cautions: only count opportunities with a real buyer, a real need, and a date, because inflating the numerator is the easiest way to feel safe and be wrong. And measure coverage at the start of the period, not at the end, since coverage is only useful as a leading indicator you can still act on.

   📄 Pipeline Coverage Ratio: What Your Number Actually Means Explains why the 3x rule of thumb is wrong for most teams and shows how to derive your own coverage number from your actual win rate. Weighted vers... 16 questions on forecasting and gtm metrics →