Startup Business Models and Pricing | Startup School
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- Опубликовано: 28 май 2024
- YC Group Partner Aaron Epstein talks about different startup business models, how to monetize, and how to price your product. Pricing and monetization is one of the most common questions from founders, and this talk outlines 9 business models as well as highlighting business model lessons from the top YC companies.
Business Model Guide: www.ycombinator.com/library/G...
Apply to Y Combinator: yc.link/SUS-apply
Work at a startup: yc.link/SUS-jobs
Chapters (Powered by bit.ly/chapterme-yc) -
00:00 - Introduction
00:13 - Outline
00:42 - 9 business models that build billion-dollar companies
02:28 - Business model lessons from the top 100 YC companies
09:42 - Overall lessons
16:06 - 5 pricing insights from top YC companies
29:15 - Story of Segment - How to charge for your product
32:00 - Wrap-up - Key pricing insights
#startup #tech #entrepreneur 
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Read the business model guide here: www.ycombinator.com/library/Gh-business-model-guide
Which of the nine models does your startup use?
How would you categorize LinkedIn? They seem to have a marketplace where each new user would be adding value and they have a SAAS model as well. They also do some advertising. I know you said a mature firm will evolve, but I remember even in the earliest days they had both the marketplace and SAAS model.
@flipgoo that model is just another way to take a cut from the seller. Whether you call it 'commission' or 'adding 5% on each item'. Same idea, it is a fee aka cost of using your platform.
I like yhis job
"Pricing is not permanent". I needed to be taught this.
I lost myself for all those 32:33 minutes. Thank you is not enough for such a presentation. Well done.
Funny how for the only business model focused on hardware the short description is basically a negative/risk statement rather than an actual description.
Remember that this statistic is Y combinators personal statistic. Their investment model is favorable for certain kinds of businesses which is why they see success in the types of businesses that work well according to their investment parameters. Not all kinds of startups are not a good fit for y combinator but that doesn't mean they don't/cant succeed. For example hardware businesses are not in their top 100 because they need so much capital. Easy examples are Nvidia or SpaceX. SpaceX needed 100 million plus capital to create a working product that now is almost monopolizing the market of orbital payload delivery.
The Y Combinator channel is one of the most valuable channels on youtube IMO and this video has been one of the best ones that I have seen not only on this channel but anywhere. Love this and thank you for sharing.
Hello Daniel. Any other channels that you recommend?
Any other channels you recommend?
@@AdeJolaosho The Y Comb channel is great at the blocking and tackling of the startup world. One of the channel I enjoy is This Week in Startups. There is a lot there so you have to pick and choose what episodes to spend time on, but the interviews are usually pretty in depth and gives you a great idea on how tech leaders and investors think. In addition to the interviews, there are topics that you will learn various strategies and their pitch show is pretty interesting to see as well as they provide quick fire feedback to the startups.
Outside of youtube, there are a lot of great blogs out there but IMO one of the best and most helpful is the blog by VC firm First Round Capital. Check that out and sign up for their mailer. Great stuff.
Definitely
Chapters (Powered by ChapterMe) -
00:00 - Introduction
00:13 - Outline
00:42 - 9 business models that build billion-dollar companies
02:28 - Leaning from the top 100 YC companies
04:19 - Marketplaces
06:13 - Transactional businesses
07:55 - SaaS companies
08:30 - Advertising businesses
09:42 - Overall lessons
09:46 - What's not in the top 100
11:24 - Recurring revenue consistently creates winners
13:24 - Defensible moats
15:36 - Recap - Best businesses
16:06 - 5 pricing insights from top YC companies
16:33 - 1. You should charge
19:40 - 2. Pricing on value, not cost
23:13 - 3. Most startups are undercharging
26:41 - 4. Pricing isn't permanent
28:19 - 5. Keep it simple
29:15 - Story of Segment - How to charge for your product
32:00 - Wrap-up - 5 key pricing insights
Your startup has a lot of potential
@@arjoaiThank you 😊
11:24
This is 100% spot on excellence: content, delivery, clarity, tone, and storytelling. Thank you 🎉
Now, that's what we call "Highly Valuable".
Thanks for sharing!
Amazing you put this public. 🙏🏼I've done b2b pricing for a few startups. It's difficult. My feeling is the biggest thing you need are real customers to work on pricing with. Pricing ultimately is what the market will bear so you have to start doing deals to understand what the market will bear. All startups seem to come down to one basic principle - know your customer (and their problems) well. The hardest part is getting out and finding customers but ultimately it's the only thing that matters. Do it early and often (advice I'm giving myself!).
33 minutes absolutely flew by! Brilliant speaker and insights, thank you!
These business models primarily apply to high growth high investment companies aiming for Billions or 100 mills which makes perfect sense for Y-C but for other entrepreneurs who just want to have several 100k or millions businesses take this list and also learn other things about small/medium businesses. Your plumber or plumbing company makes great money with a simple: build trust, do good work, advertise , hire good employees and send an invoice.
I watch all of the y combinator channel videos and never comment, but for this one I have to make an exception. That was an extremely informative video and helped me a lot-- thank you!
I really enjoyed this video! Everything was succinct, clear, and actionable! And it provided enough context for the usual advice that one receives.
I was trying to figure out how to show my business model on my investor pitch deck. Your video comes like a savior for me. Law of attraction 😅
Exactly as we’ve been struggling with this issue, YC comes through. Thank you!!
marketplace or transactional
tldr 15:50
20:00 cost pricing
21:50 one of four things
2230 complain but stilll pay
23:00 price can't be your only moat
24:00
pricing implies values, and why
26:10 well recognized logo, lock in
This would easily qualify as having high value content. I needed this video so much!
Very clear explanation! We believe that all employees of the company should be oriented in how the business works and develop their business acumen. We have already advised our team members to take a look!
Thank you SO much!!! It is incredible, super relevant, concise, and comprehensive 💥
This one wowed me. Great. Lessons learned. Thanks YC. Thumbs up Aaron.
This content is such valuable why most people watching something else as of today I can start my own startup
Man this was the most useful thing I ever heard about business and I heard it in the perfect time while im writing down my business model and plan
Wish me luck 🙏
Guys, I'm applying to YC for my startup this year. Wish me luck!!
Luck
fantastic content!!! I hope everyone understands how valuable this information is.
Fantastic advice. Thank you for putting so much thought into this video.
Awesome teaching. Very insightful.
Great video. Incredibly insightful. Thanks!!
It's funny that basically great web design was one of Stripe's differentiators for years. There are a number of times I suggested/chose Stripe just because the docs were so nice. It did save a ton of dev time. Before modern payments APIs, to setup payments on your website you had to dial a number and it made internet noises for a while, then some guy answered and was like "hello?"
Incredibly good content. No-nonsense. Excellent presenter
This was so valuable - thank you for sharing!
direct to points. very useful video. I wanted to do a video exactly like this
11:45 recurring revenue 14:10 enterprise, churn is a lot lower 15:11 organic distribution
This was very informative and helpful. Thanks
Thanks Y Combinator for sharing those valuable lessons
This is perfect. I will be rewatching this video along with the ones by thiel and graham
Incredible insights ❤❤❤🎉 thank you!
Some great valuable lessons, thanks YC team!
Really enjoyed watching this...great insight.
Thank you for sharing this knowledge!
Very enlightening. Thank you
That is phenomenally useful. Thankyou.
Thank you, very informative
Wow, that was an amazing piece of content, thanks!
The best channel on RUclips. Contents galore
Excellent talk! more please!
Awesome info! Thanks.
This video is priceless. Thank you so much.
extremly valuable , thank you man ❤
This video is incredibly packed of essential information. Thanks for sharing! 🙏
Still gets me thinking that a founder managed to talk to a client who was previously paying $120 a year and asked $120,000 for the same services?! 😂 And then finally settled for $18,000? What's going on?
Good points nevertheless, but that Founder I want to meet.. 😂😂
@@cryptoniku6723 enterprise customer. They were embarrased to pay $120, also they feared the startup was going to fail. Interesting founder indeed but for not realizing this eariler.
Great work! Thank you
This video, like a lot of YC videos is pure gold for founders.
Wow, that’s a lot of good info! Maybe I don’t really don’t need to get an MBA after all. Just subscribe to this channel!
hello! thank you very much. where is the business model guide link?
Really like your videos. Really wish you could condense them in to 10 minutes or send links to full articles. Your target market for these videos often doesn't have the time to watch 30+ minutes of RUclips with everything else going on
Fantastic explanation!
What is the business model of Apple according to the nine business models?
wow! its amazing and insightful, thanks!
Dude 🤓 thank you so much to this team
Considering that this is the half-year old video and Gitlab at that time has been charging $19 (screenshots in the video), but as we can see now on their website it is $29 for the same plan... they have watched this video too!
Thank you so much YC
Thanks for a great video
amazing content well done
Great insights 🎉
Wow really great value!
This is amazing!
This video was great. Love the idea about pricing models and charging instead of going free. But I also feel that for some startups having a free / basic options with limited functionality is a good way attract new customers. If they need and love the product sooner or later they signup for premium account.
exactly. Near the end of the video i shown Gitlabs pricing and it shows the free option with the 2 other paid ones.
What type of business model does apple have according to the nine business models explained in the video?
this was gold 🤝
O melhor a explicar sobre startup business no mercado
Great insights
Thank you! Very informative and very well presented... very grateful!
However, at the same time very uninspiring... I know these are hard strategies but would I work with somebody just trying to get a biz model right..? Nah.. though these are critically important they are as inspiring as reptiles!
This is a very valuable vid
the high frequencies of the audio here is strangely abrasive
thank you!
Incredible content.
Amazing Video!
Education comes under which Business Model?
00:07 Key business model types for successful startups
02:17 SAS, transactional, and marketplaces make up 67% of the top 100 YC companies.
07:00 Transactional businesses are critical infrastructure for companies and have consistent revenue.
09:20 Avoid using ads as primary business model unless a top 10 site on the internet.
13:52 The best businesses have recurring revenue and defensible moats
16:10 Use pricing as a tool to learn faster
20:01 Avoid Cost Plus pricing and focus on capturing the perceived value of your product.
21:53 Find your value proposition and ideal pricing strategy.
25:39 Consider offering lower pricing in exchange for specific benefits
27:31 Adding enough value into the product can support price increase and growth.
31:22 Startups should charge for their product and pricing should be based on value, not cost.
If i got this before, may be I can earn more money. Really nice video.
Better described than my mba class
3:24 - I wonder if this is partially due to Y Combinator's preference for these types of companies?
Very useful information and great thank you for that. At the same time video have horrible sound - speaker deafeningly loud at the first letter of sentence and then quiet to be heard in the end of the sentence. Maybe at least editor should google about how to use the sound compressor.
Fantastic!!!
How do the 9 business models apply to Healthcare Services companies? e.g. if it's a healthcare provider like Caron Health / Parsley / One Medical?
Thank you
Would like to see the SaaS model updated to also consider the other ‘as-a-service’ models like TaaS: Transportation-as-a-Service (ours!)
Isn't that just a service as a service?
@@koshobai all services are as a service. But there is a wide variety of things that can be done as a service with different models and specificities and applications
If your TaaS works like Lyft, Uber or the likes (which I think it does), then it falls right into the marketplace category, given that it drivers + riders onto the same platform.
Can you guide food business comes in which category?
I didn't understand the part you were talking about lowering price in exchange for your first user, logo etc. What do you mean by that?
Let's say a company helps it's customers invest, now would this be a marketplace because they are providing investments options or a transactional business because they make their revenue as a percentage of the investments?
Awesome 👌
Can you guys figure out the whole audio situation? Love the videos but the audio is really difficult to hear (says the old guy).
BRILLIANT
What about launching a product for a 2 weeks frío trial and then let customers know that it I am going to charge with either transaction fee or by subscription?
Is this a good idea to approach on a small size mobile app product?
More specifically a marketplace to bring supplier and consumer into the app itself
5:11 Marketplace Takeaways
Rather than Bio, I think it's more descriptive to call that business model Patent Royalties
Hi there, just wondering if there is a way to gauge the valuation of an early stage hardware startup seeking its first funding. Is there a formula that I could use any excel?
What kind of hardware startup are you working on
@@Abhishek-zd9vk smartwatches
Gold !
Very insightful. Please upload more about oricing techniques.
What is the difference between transactional and e-commerce companies?
This video is brilliant.
However, there is usually something not considered, and it is not in this videos: pricing depends on the customer, not on the seller. So, there is no. specific price level where customers drop off. Some customers do at some level others do at some different one.
So, we have to be sure our first customers do present our target market, don't we? :)