This week, Tim Bryan (CRO) and Brett Robbins (Head of BD) of Custora joined us in the Bowery Capital studio for another episode of the Startup Sales Podcast: “Choosing Your Scaling Units in SaaS Pricing.” Custora is a leading platform for advanced customer analytics in the retail space. The company’s solution brings CLTV analysis to the next level, providing marketing leaders with the data they need to maximize profitable growth over the long term. In our podcast, we discussed a critical element of SaaS pricing: choosing the proper “unit” by which your pricing model should scale.
Tim Bryan is the Chief Revenue Officer at Custora. Tim brings over 8 years of experience as a sales leader, having served in a role CRO the last 3.5. Tim previously led Sales at Moveable Ink. Before that, he worked as VP of Advertising Sales at Time, Director of New Media Sales at A&E, and Managing Director at the New York Times Media Group. Tim earned his BA in English from Syracuse University.
Brett Robbins is the Head of Business Development at Custora. Brett brings over 9 years of Business Development and Sales expertise to Custora. Brett is responsible for leading strategy and product development for Custora’s new businesses verticals and growth areas. Previously, Brett served as Custora’s Head of Sales. Prior to that, he worked as VP of Ops at Seamless Health, Engagement Manager at McKinsey, and CEO of Inside New York. Brett earned his BA in Economics and Anthropology from Columbia University.
Setting and optimizing pricing is one of the most difficult challenges a SaaS startup leader faces early on, and the first key step is determining the scaling unit that will underpin your model. Some example scaling units, also called “pricing currencies,” include: per employee (a model used by many HR tech businesses), per GB (used by many enterprise storage providers), per customer or contact (used by Custora and Hubspot, respectively), and many others (an interesting example is Amazon Lambda’s per millisecond model). Many SaaS pricing models include a layer on top of this scaling unit that breaks packages down into consumable, easy to understand “tiers.” SaaS pricing tiers (commonly 3-6) are offered at discrete price points and divided by “breakpoints” of the scaling unit (e.g. Tier 1 is up to 10 users, Tier 2 is up to 50, and so on). Each subsequent tier includes its own set of features you won’t get with lesser tiers, like additional modules or higher-touch levels of support. For the purposes of this week’s subject, however, we focused squarely on the underlying scaling unit and how to choose the right one for the business. We broke the thought process down into 5 key considerations: (1) aligning with value; (2) aligning with product; (3) aligning with sector; (4) testing the model; and (5) evolving the model over time.
Tune in now to find out how Tim and Brett used these 5 steps to perfect their SaaS pricing model at Custora and in past roles at companies like Moveable Ink, the NYT, and McKinsey. Bringing together both Sales and BD perspectives, today’s episode should provide you with a framework for determining the scaling unit that makes sense for your business and customers. Keep an eye out for an in-depth follow-up post on this topic Monday, and until next week, happy listening!
If you liked “Choosing Your Scaling Units in SaaS Pricing” and want to read more content from the Bowery Capital Team, check out other relevant posts from the Bowery Capital Blog. If you haven’t already, subscribe to the podcast to get all our new content each week!