Clay deliberately chose usage-based over seat-based pricing because their ideal customer is a technical builder (GTM Ops, Growth Marketer), not an individual salesperson. This model aligns value with the systems these builders create for the entire team, rather than charging for every end-user who benefits from the output.
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After realizing most users creating casual polls for lunch spots would never pay, Polly found its premium market. They targeted users responsible for expensive, high-stakes events like company all-hands and sales kickoffs, where the value of instant feedback was undeniable and justified the cost.
AI startups should choose their pricing model based on a 2x2 matrix of autonomy (human-in-the-loop vs. fully automated) and attribution (how clearly its value can be measured). Low levels lead to seat-based pricing, while high levels of both unlock outcome-based models.
A one-size-fits-all sales role fails in consumption models. Success requires segmenting the team into specialized roles—new business acquisition, customer onboarding, and account management—each with distinct incentives aligned to their specific function, from initial sign-up to value realization and expansion.
Assembled launched with usage-based pricing and no minimums. When the pandemic hit, customers scaled usage to zero, and revenue flatlined. The team initially blamed their product, only later realizing their pricing model made them vulnerable to customers' cost-cutting measures, independent of product value.
Standard SaaS pricing fails for agentic products because high usage becomes a cost center. Avoid the trap of profiting from non-use. Instead, implement a hybrid model with a fixed base and usage-based overages, or, ideally, tie pricing directly to measurable outcomes generated by the AI.
At the $300k revenue stage with one salesperson, defining a precise Ideal Customer Profile isn't just for targeting. It's a survival mechanism to focus limited resources, prevent churn, and ensure every sales effort contributes to scalable growth, rather than creating future service burdens that consume your only salesperson.
For his next SaaS, Castos founder Craig Hewitt has three strict rules: 1) Price must be at least $100/month. 2) The model must have built-in expansion revenue (e.g., usage-based). 3) It must align with his existing customer base to leverage his established brand and audience.
Effective pricing is not just a number; it is a value story. The ultimate test is whether a customer can accurately pitch your product's pricing and value proposition to someone else. This reframes pricing from a simple number to a compelling narrative.