Initial product pricing is the process of setting the first price for your new product or service. It’s a critical decision that balances the need to attract your first customers with the goal of establishing your product’s value and building a sustainable business model from day one.

Getting the price right for your first ten customers isn’t about maximizing revenue immediately. Instead, it’s a strategic exercise in market validation. This early phase is your best opportunity to test assumptions, gather direct feedback, and understand how real users perceive the value you’re offering. The goal is to find a price point that feels like a great deal to early adopters but also sets a foundation for future, scalable pricing tiers.

Setting your initial pricing is one of the most impactful decisions a founder can make. It directly influences your product’s market position, who your first users will be, and the trajectory of your revenue growth.

Here’s why focusing on the first ten customers is so crucial:

• It validates your value proposition. If people are willing to pay for your solution, you’ve confirmed you’re solving a real problem. The price they pay is a strong signal of the value they expect to receive.
• It attracts the right kind of customer. Early adopters who pay are invested in your success. They are more likely to provide detailed, constructive feedback than users of a free product.
• It sets a price anchor. Your initial price establishes a reference point for all future customers. Starting too low can make it difficult to raise prices later without backlash, while starting too high can deter adoption altogether.
• It builds momentum. Securing your first paying customers provides the revenue, confidence, and social proof needed to attract the next 100.

There isn’t a single magic formula for pricing. It’s a blend of art and science. The best approach involves researching your market, understanding your costs, and, most importantly, talking to potential customers. Below is a practical framework for thinking through your first price.

Instead of just covering your costs or copying competitors, anchor your price to the value your product delivers. Ask yourself:

• How much time or money does my product save my customer?
• How much additional revenue can it help them generate?
• Does it remove a major pain point or frustration?

Quantifying this value gives you a ceiling for your price. For example, if your tool saves a small business 10 hours of manual work a month, and their time is worth $50/hour, the value you provide is around $500 a month. You could reasonably charge a fraction of that, making it an easy decision for the customer.

Look at what direct and indirect competitors are charging. This helps you understand market expectations and where your product fits in. Don’t just look at the price; analyze their pricing models (e.g., per-user, usage-based, flat fee) and the features offered at each tier.

Create a simple table to map this out:

This exercise isn’t to find an average price to copy. It’s to identify opportunities. Is there a gap in the market for a simpler, more affordable solution? Or a premium offering with more hands-on support?

The most valuable insights come from direct conversations. Before you even set a price, talk to at least 10-20 people in your target audience. Don’t ask them “What would you pay?” as people are notoriously bad at answering that question hypothetically.

Instead, use techniques like the Van Westendorp Price Sensitivity Meter, which involves asking four key questions:

• At what price would you consider the product to be so expensive that you would not consider buying it? (Too expensive)
• At what price would you consider the product to be priced so low that you would feel the quality couldn’t be very good? (Too cheap)
• At what price would you consider the product starting to get expensive, so that it is not out of the question, but you would have to give some thought to buying it? (Expensive/High Side)
• At what price would you consider the product to be a bargain—a great buy for the money? (Cheap/Good Value)

The answers will give you a realistic price range to test.

Pricing is fraught with uncertainty, and it’s easy to fall into common traps.

• The fear of charging money. Many first-time founders are afraid to ask for money, worrying it will scare users away. But a free product often attracts users who aren’t serious and won’t provide the quality feedback you need. Charging, even a small amount, is a powerful filter.
• Believing the price is set in stone. Your initial price is not a permanent decision. It’s a starting point. Plan to revisit and adjust your pricing strategy as you learn more about your customers and as your product evolves.
• Pricing based on costs alone. While you need to cover your costs to be profitable, cost-plus pricing ignores the most important factor: the value your customer receives. You could be leaving significant money on the table.
• Offering too many options. For your first ten customers, keep it simple. One or two pricing plans are enough. Complexity can lead to confusion and analysis paralysis, preventing potential customers from making a decision.

• Offer an “early adopter” deal. Acknowledge and reward your first customers with a special discount. A lifetime discount (e.g., “50% off forever”) can be a powerful incentive for them to commit early and stick with you.
• Be transparent. Clearly communicate what customers get for their money. If you plan to raise prices later, be upfront about it. For example, you could state that the current price is for the first 50 customers only.
• Focus on learning, not profit. The primary goal with your first ten customers is to validate your product and pricing. The revenue is a bonus. Prioritize feedback and building strong relationships.
• Make it easy to pay. Ensure your payment and checkout process is seamless. Any friction here can cause you to lose a hard-won customer.

Once you’ve settled on an initial pricing strategy, you need the infrastructure to implement it. This is where a platform like Kinde can accelerate your progress. Instead of building a billing system from scratch, you can focus on your core product.

Kinde’s billing engine is designed for flexibility, allowing you to easily set up and manage different pricing structures. You can start with a simple flat-rate subscription and later evolve to more complex models like usage-based or tiered pricing without having to re-engineer your entire system.

You can create subscription plans, manage features for each plan, and even generate pricing tables to embed in your application. This allows you to test different price points and offerings quickly, gathering real-world data on what resonates with your first customers.

• Pricing models
• Create plans
• Add and manage plan groups
• About plans
• Build a pricing table