Three defensible pricing methods, one of them right for your stage. This page is about choosing the method — not about ending your price in a nine.
A SaaS pricing framework is a method for deciding how to set a price, not the price itself. There are three defensible methods, and the honest answer is that only one of them works well for a solo founder — but not until you have enough customers to use it.
Launch competitor-anchored, migrate to value-based once you have roughly twenty customers and know what they actually replaced.
Most pricing advice skips the selection step and goes straight to tactics — end in 9, three tiers, anchor high. Those tactics only work once the method underneath them is right.
Every SaaS pricing framework reduces to one of three ways of answering "what number goes on the page".
| Method | Basis | When it is defensible | Failure mode |
|---|---|---|---|
| Cost-plus | Your cost to serve | Heavy per-customer compute or human delivery | Prices a $500 outcome at $12 because hosting is cheap |
| Competitor-anchored | The alternatives | Pre-launch and first ~20 customers | Locks you to a competitor's cost structure and their mistakes |
| Value-based | Value delivered | Once you know what customers replaced | Needs customer evidence you do not have at launch |
Cost-plus is a trap for software. Marginal cost per customer is close to zero, so cost-plus produces absurdly low prices. It is the reason so many indie products launch at $9 a month. The exception is products with real per-customer cost — heavy AI inference, video processing, or anything with you in the delivery loop.
Competitor-anchored is the correct starting point, which contradicts most pricing advice. At zero customers you have no value evidence, and a defensible reference point beats a confident guess. The mistake is staying there.
Value-based is where you should end up. It is also the method that requires the most information: what the customer did before, what that cost them, and what they would do if your product disappeared.
Four steps, in order. Do not skip step one — it is the step that determines whether the rest of the exercise is grounded.
Step 1. Name the alternative. Write the specific thing your customer does today instead of using your product. Not "nothing" — people always do something. A spreadsheet, a freelancer, a competitor, four hours of manual work. Name it and price it.
Step 2. Anchor against that alternative, not against other SaaS. If the alternative is a freelancer at $600 a month, your ceiling is much higher than if the alternative is a free Notion template. Founders anchor against the cheapest tool in their category and inherit its ceiling.
Step 3. Pick the unit before the number. What you charge for shapes everything after it. This is the value metric decision, and it is harder to change later than the price itself.
Step 4. Set a number you are slightly uncomfortable with. Discomfort is a reasonable signal at this stage, because the systematic error runs one direction. Nearly every solo founder underprices.
Bring your alternative, your unit and your candidate number to a session. Marcus will tell you which of the three is wrong.
Run it past Marcus →| Stage | Method | What to do |
|---|---|---|
| Pre-launch, 0 customers | Competitor-anchored | Price against the named alternative. Ship. Do not survey. |
| 1–20 customers | Competitor-anchored | Ask every customer what they replaced. Collect evidence. |
| 20–100 customers | Value-based | Reprice on evidence. Raise for new customers only. |
| 100+ customers | Value-based, segmented | Different value stories per segment, tiers reflect them |
The transition at twenty customers is the one most solo founders never make. They set a price pre-launch, it works well enough, and three years later they are still charging it while the product has tripled in scope.
Pricing against your own financial situation instead of your customer's alternative.
A founder living on $3,000 a month reads $79 as a significant expense. Their customer, a consultant billing $8,000 a month who currently loses four hours a week to the problem, reads it as a rounding error. Both are looking at the same number and seeing different things.
The correction is mechanical: never evaluate your price in your own currency of pain. Evaluate it against the specific cost of the alternative you named in step one.
A useful check: if no prospect has ever told you the price is too high, it is too low. A price nobody objects to is a price nobody had to think about, which usually means it sits below the threshold where people evaluate value at all.
This page covers method selection. Three other pages cover execution.
For running the numbers, tiers and the actual page, use the guide to pricing a SaaS product. If your pricing is already live and something feels wrong, the pricing diagnostic works backwards from the symptom.
If you built the product with AI tools and have not priced it yet, pricing a vibe-coded SaaS covers the specific version of this problem. And if your pricing is fine but trials are not converting, the bottleneck is elsewhere — see trial-to-paid conversion.
A SaaS pricing framework is a method for deciding how to set a price, rather than the price itself. There are three: cost-plus, competitor-anchored, and value-based. Choosing the method comes before choosing tiers or numbers, because the tactics only work when the method underneath them is right.
Launch competitor-anchored, then migrate to value-based at roughly twenty customers. At zero customers you have no value evidence, so a defensible reference point beats a confident guess. The mistake is never making the transition and charging your launch price for three years.
Rarely. Marginal cost per customer in software is close to zero, so cost-plus produces absurdly low prices — it is why many indie products launch at $9 a month. The exception is products with real per-customer costs, such as heavy AI inference, video processing, or human delivery.
At around twenty customers, once you can answer what each of them was doing before they found you and what that alternative cost. Before that point you are guessing at value; after it you have evidence. Apply new pricing to new customers first.
If no prospect has ever objected to the price, it is almost certainly too low. A price nobody questions is a price nobody evaluated, which usually means it sits below the threshold where buyers assess value at all.
Tell Marcus your product, your stage and what your customers did before they found you. You get one specific recommendation on price.
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