Many early-stage founders are hesitant to charge a 6 figure amount, but if you’re selling to Enterprise customers, $100k a year is the minimum price. Here’s why:
1. Time to Close
Enterprise customers can sometimes take 6–12 months to close, so given you’re only going to close a small number of them each year, you’ll need to charge a significant fee.
2. Cost to Supply
Enterprise customers often have a myriad of compliance, security, integration and reliability requirements. All of these will drastically increase your costs to supply the product, so you have to charge a lot more than you would for a consumer or small business.
3. Customer Expectations
If you’re not charging a 6 figure amount, enterprise customers will be suspicious. They expect to be charged more than other types of customers and if you don’t, it may reveal your inexperience.
Best of luck out there.
Sterling Road invests in idea stage and pre-seed B2B startups based in the US, Canada and UK.
