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@warranty_wes ·

seat pricing or per-task pricing when one account costs me $410 a month in compute Usage-Based

Flat $12 per seat. One account has 8 seats, which is $96/month, and last month they ran 41,000 tasks. My variable cost is about $0.01 a task, so that account cost me $410 and paid me $96.

Meanwhile the median account runs 900 tasks and pays $36 for three seats, which is very comfortable.

So the seat model is subsidising one customer with everyone else. Do I move everyone to per-task, or is there a shape I am missing? Chart of the margin curve attached, the crossover is around 4,800 tasks.

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  • @brinekeeper · 3mo ago · 3 replies

    You do not have a pricing model problem, you have one price stretched over two different products. The 900-task account and the 41,000-task account are not buying the same thing.

    The shape you want is a platform fee plus an included allowance plus overage. Something like $99/month including 8,000 tasks, then $0.015 per task after. Light accounts pay a floor that covers support and hosting, heavy accounts pay for what they burn, and your margin stops being a lottery ticket on who signs up.

    Pure per-task is worse than it looks. Revenue becomes unforecastable, and more importantly customers get afraid of the product. Nobody wants a meter running from unit one, so they use it less, which is the opposite of what you want.

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    • @p99_hana · 3mo ago

      The included allowance is the part everyone skips and it is the part that makes usage pricing survivable. Same invoice most months, and the overage only shows up when they genuinely got more value.

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    • @epsilon_eddie · 3mo ago

      Set the allowance from your actual median, not from what you wish usage looked like. If your p50 is 900 tasks then 8,000 included means basically nobody ever sees an overage line and the whole mechanism is decorative.

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  • @burr_bennet · 3mo ago

    Keep seats for who is allowed to log in and meter the thing that costs you money. Two dials, both of which a finance person can read off an invoice without calling you. Seats-only breaks exactly the way you described, usage-only makes small customers nervous.

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  • @runway_math · 3mo ago · 2 replies

    Before you redesign anything, find out whether that account is a product bug wearing a costume. 41,000 tasks across 8 seats is 5,125 each. Is a human doing that? Or did somebody wire your API into a loop, or hit a retry path that never terminates?

    I would want to see the distribution of those 41,000 by hour before I changed a price.

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    • @bench_dogged · 3mo ago

      This. Roughly half the "we need usage pricing" conversations I have watched turned out to be a retry storm, a polling loop set to one second, or one integration test suite running against production.

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  • @rawfileruth · 3mo ago

    Or raise the seat price. $12 is a sandwich. If the product is worth $410 of compute to them it is very obviously worth more than $96 to them, and you are the only person in the transaction who thinks otherwise.

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  • @hemline_hana · 3mo ago · 2 replies

    Simplest thing: hard cap everyone at 10,000 tasks a month. No pricing redesign, no metering infrastructure, problem gone by Friday.

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    • @brinekeeper · 3mo ago

      Capping your heaviest, most engaged account is a churn event with extra steps. Cap the free tier if you have one. On a paid plan a cap is just a worse version of overage, because they hit the wall and you get an angry email instead of $200.

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  • @notetaking_ivo · 3mo ago

    Budget for the plumbing before you commit. Usage pricing means metering, an idempotent event pipeline, reconciliation, dunning on amounts that change every month, and a support load of "why is this invoice different". Two weeks minimum, and it never fully goes away.

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