The Cheapest Product Rarely Wins

Most founders I've backed have made the same mistake with pricing. They build something exceptional, something the market has never seen — and then price it like rice.

It's fear dressed as strategy.

They tell themselves: "If I charge less, more people will buy." It sounds logical. It's also wrong.

Here's what I've seen from inside dozens of companies: the ones that charge more grow faster. Not despite the higher price. Because of it.

The math isn't complicated. Higher margins mean more money for R&D. More money for R&D means a better product. A better product means happier customers who pay even more. It's a flywheel most founders never spin because they're too scared to turn the crank.

But there's something deeper.

Pricing reveals whether you actually have a moat. If your customers leave when you raise prices, you were never differentiated — you were just cheap. If they stay, you've learned something important: they need you more than you need them.

That's power. That's a business.

The question isn't "what does this cost to make?" The question is "what is this worth to the person buying it?"

When you're selling to businesses, you're not selling features. You're selling outcomes — time saved, money made, problems removed. Price should reflect a percentage of that value, not your server costs.

Engineers hate this. They see commerce like physics: one input, one output. But commerce isn't physics. It's psychology. It's trust. It's the story you tell about why your thing matters.

The company that charges more can afford the sales team that wins the deal. The company that wins the deal can afford the engineers that ship the next feature. The company that ships the feature can afford to charge even more.

High prices aren't just good for you. They're good for your customers. They fund the product your customers actually want.

Cheap is a trap. It feels generous. It's actually a shortcut to irrelevance.

Raise your prices. Then raise them again.

The founders who understand this build companies. The ones who don't compete on cost until they die.