Playbook / Lessons / First customers: the offer, the price
StartupsA money-back guarantee starts the billing relationship
Tunguz lays out four ways a software company can charge: freemium, a limited free trial, up-front payment and a money-back guarantee. He says up-front payment suits well-known products, while a money-back guarantee suits products with no established brand because it starts a billing relationship at once. He adds that this early commitment gives the sales team fewer, higher quality leads.
“In other words, the up front commitment is a sales pre-qualifier.”— Tomasz Tunguz, How To Price and Sell Your Startup’s Product, Apr 2013
Do this
Choose one payment model this week, such as a paid start with a money-back guarantee, and put it on your pricing page.