On Wednesday night I was invited to speak at the Flounders Club.
The theme for the night was Pricing and Revenue Models and as the oldest company there IÂ was the last to speak so was wondering how much I’d have to add to the topic after hearing from Dale from Weirdly and Vaughan from Vend.
As it turned out while we were all on the same page, we had all got there in different ways. This in essence sums up pricing in my mind – experiment, experiment experiment.
Dale explained how they had continued testing different pricing and even updated what service they actually sell (though not as a result of changing the product).
Vaughan talked about Negative Churn as the holy grail for a SaS business and how to set about achieving this – or at least trying to.
I talked about the history of our Cadimage pricing over the last 10 years and how we recently moved from a perpetual model to a SaS model.
Overall it seemed that the biggest questions for the night revolved around the assumptions required to get a SaS business started. Â All three of us were asked the question in different ways but ultimately the message was, you have to make some assumptions (and various rules of thumb were suggested) and then you just need to get started, experiment and evolve. The more you get into it the more you can tweak your original assumptions.
For anyone interested in the state of play in the New Zealand start-up scene, or anyone who likes to read what has worked or not worked when building a business check out Rowan Simpson’s Founder Centric Startups Series.
The series is an amazing piece of work and all credit has to go to Rowan and the contributors for making this happen.
The stories are all good and certainly shows there is no script when it comes to creating / running a startup. What works for one doesn’t necessarily apply to another.
My perspective has always been to read and research material like this and take out what I think may work for my businesses. Sometimes we succeed, sometimes we make mistakes, but the most important thing is we review and we learn.
In parallel with this series both Rowan(as an intro to his series)Â and Lance (Are you an Angel – probably not and Investing with appropriate speed) commented on the structures that support startups – this stirred up a great debate, one that is extremely healthy as New Zealand strives to grow the knowledge economy.
I have written before about the bookÂ Rework and also Getting Real by the same authors.
One of the authors,Â Jason Fried, also has a column on Inc that is well worth a review.
Articles I really enjoyed include:
Don’t Exaggerate Your Size
Why I Run a Flat Company
Go Ahead, Raise Your Business’s Prices
I find the way Jason writes is very straight forward and to the point – much like the software his company 37Signals creates!
Here are a couple of recent articles that are definitely worth a read if you are thinking about starting a business:
Evernote Shows Startups: ‘Free’ Can Pay – by concentrating on making customers happy you can use ‘free’ products to make money. Also, don’t get hung up on the percentage of your customers who pay, but the number of customers who pay.
From the latest issue of Idealog a great read by Rowan Simpson about the Mythical Startup – most overnight successes take time!