Easier to be Premium

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Today, we’re talking about initial pricing for startups. In my opinion, it’s a lot easier to start as a premium service.

1. If you’re charging more, you give yourself room to make mistakes without it costing you more than you’ve received from the customer and reducing your runway.

2. Building great software is tough, when you’re still a very small team. It’s a lot easier to provide a wonderful, concierge service, because you don’t have a lot of customers.

3. No need for broad distribution. As premium customers pay more, you need less of them, which then means you can spend less money on marketing.