Madhavan Ramanujam: recommendation

Transcript context

…This touches on something I was about to ask, which is a change in your pricing strategy. How often is it a success to change the way you price? I know we're talking about you need to get it right from the beginning if you're an AI company. In your experience, how often... What does it take to successfully shift the way you price down the road if people are listening to this and are like, "Shit, we already have this pricing strategy"? Back in the day, we used to say that you should revisit your pricing strategy, overall pricing model, how much you're charging at least once in two years. With AI, that's probably reduced in half because of the scale with which and the speed with which companies are built and competing. So I would say that it is an ongoing journey. It is not like you just solve it in day one, fill it, and forget it. You have to be thoughtful from day one, but also be ready to pivot, iterate, and you're going to learn along your journey. So the whole point is to think about pricing as also a test-and-learn opportunity in your early days. And there are things that you would change more often, and there are things that you probably don't want to change too often. Things like pricing model, unless you really changed your attribution autonomy, there is no need to shift your pricing model. Stay within that archetype. Don't confuse things. But there are things like price points. Should I increase my price because it's been six months a year? Yeah, you should. Because in a year there's probably prices go up three to 5% for everything that you consume. But how can you actually increase your prices and be thoughtful about it? So that entire chapter on how to do price increases smartly become very important in the scale-up phase. I think Warren Buffett summarized this really well. He said the true definition of a company is a pricing power. And if you have a prayer session for doing a 10% price increase, you have a terrible business. So you have to be able to increase prices over a bit of time. But how do you do it strategically that does not affect too much churn, but you're also able to pass on the increase as a value exchange, those things become critical. Awesome. Zooming out a little bit, something that I love about your book is you structured it around these axioms. You have a bunch of these really clever axioms that get stuck in your head and help you think about pricing. Can you share some of your favorites, maybe two or three referred axioms from the book?…

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