The Indie Hacker's Guide to SaaS Pricing That Actually Converts

Pricing is the most powerful lever you have for growing your SaaS business, yet most indie hackers spend less than an hour thinking about it. They pick a number that "feels right," usually way too low, and leave massive amounts of money on the table.

In this guide, we'll cover everything you need to know about pricing your SaaS product for maximum revenue and growth.

The Underpricing Epidemic

Here's a hard truth: if nobody has ever complained about your price, it's too low.

Indie hackers consistently underprice their products for several reasons:

• Imposter syndrome - "Who am I to charge that much?"
• Fear of rejection - "What if nobody buys?"
• Comparison to big players - "Notion is only $10/month"
• Undervaluing their time - "I built it in a weekend"

But here's what underpricing actually costs you:

• Lower perceived value (cheap = low quality)
• Attracting price-sensitive customers who churn faster
• Less revenue to reinvest in growth
• Burnout from needing too many customers to survive

Understanding Pricing Models

Flat-Rate Pricing

One price for everyone. Simple to understand and implement.

Best for: Simple tools with clear value propositions

Examples: Carrd ($19/year), Plausible ($9/month)

Pros:

• Easy to communicate
• Simple billing
• No confusion

Cons:

• Leaves money on the table from power users
• Can't capture different willingness to pay

Tiered Pricing

Good-better-best options at different price points.

Best for: Most SaaS products

Examples: Notion, Slack, virtually every SaaS

Pros:

• Captures different customer segments
• Creates natural upgrade path
• Middle tier benefits from anchoring

Cons:

• More complex to manage
• Requires clear differentiation between tiers

Pro tip: Most customers choose the middle tier. Make it your most profitable option.

Usage-Based Pricing

Pay for what you use.

Best for: APIs, infrastructure, tools with variable usage

Examples: AWS, Stripe, OpenAI

Pros:

• Low barrier to entry
• Revenue scales with customer success
• Fair perception

Cons:

• Unpredictable revenue
• Can scare customers with variable bills
• Complex to implement

Per-Seat Pricing

Charge per user or team member.

Best for: Collaboration tools, team software

Examples: Slack, Figma, Linear

Pros:

• Revenue grows as customers grow
• Easy to understand
• Predictable for customers

Cons:

• Incentivizes seat sharing
• Can limit adoption within organizations

How to Find Your Optimal Price

The Van Westendorp Method

Ask potential customers four questions:

1. At what price would this be so cheap you'd question the quality?
2. At what price would this be a bargain?
3. At what price would this start to get expensive?
4. At what price would this be too expensive to consider?

Plot the responses and find where the curves intersect. This gives you an acceptable price range.

The 10x Value Rule

Your product should deliver at least 10x the value of its price. If you charge $50/month, your product should save or generate at least $500/month for the customer.

How to calculate value:

• Time saved × hourly rate
• Revenue generated
• Costs avoided
• Productivity gains

If you can't articulate 10x value, either your price is too high or your positioning is wrong.

Competitor Analysis

Research what competitors charge, but don't just copy them.

Questions to ask:

• What do they include at each tier?
• What do customers complain about?
• Where are the gaps in the market?
• Can you serve a different segment?

Positioning options:

• Premium: Charge 2-3x more with better service/features
• Value: Similar features at lower price
• Niche: Specialized solution for specific segment

Customer Interviews

Ask existing or potential customers directly:

• "What would you expect to pay for this?"
• "At what price would this be an easy yes?"
• "At what price would you have to think hard about it?"
• "What would make it worth paying more?"

Pricing Page Best Practices

Highlight One Plan

Use visual hierarchy to draw attention to your recommended plan. This is usually the middle tier.

Use Anchoring

Show your highest-priced plan first (on the left or top). This makes other plans seem more reasonable.

Annual Billing Discount

Offer 15-20% off for annual billing. This improves cash flow and reduces churn.

Show Prices in Local Currency

Use geo-detection to show prices in the visitor's currency. This removes friction and improves conversion.

Include Social Proof

Add customer logos, testimonials, or user counts near your pricing. This builds trust at the decision point.

Money-Back Guarantee

Reduce risk with a 30-day money-back guarantee. Very few people actually request refunds, but it removes purchase anxiety.

Clear Feature Comparison

Use a comparison table to show exactly what's included in each tier. Highlight the differences that matter most.

When and How to Raise Prices

Signs It's Time to Raise Prices

• Conversion rate is above 5%
• No one complains about price
• You've added significant new features
• Competitors charge more for less
• You're attracting too many low-quality customers

How to Raise Prices

1. Grandfather existing customers - Keep them at their current price
2. Announce in advance - Give 30-60 days notice
3. Explain the value - Connect the increase to new features/improvements
4. Test first - Raise prices for new customers only, measure impact

How Much to Raise

Start with 20-30% increases. If conversion stays stable, raise again in 6 months. Keep going until you see meaningful resistance.

Pricing Psychology Tricks

Charm Pricing

$49 feels significantly cheaper than $50. Use prices ending in 9 for consumer products.

Round Numbers for Premium

$100 feels more premium than $99. Use round numbers for high-end positioning.

Remove the Dollar Sign

Studies show removing currency symbols increases willingness to pay. Use "49" instead of "$49" where appropriate.

Price Per Day

"Less than a cup of coffee per day" makes monthly prices feel smaller. Use this in marketing copy.

Decoy Pricing

Add a third option that makes your target option look better. The decoy isn't meant to sell; it's meant to make another option more attractive.

Common Pricing Mistakes

1. Pricing based on costs - Price based on value, not what it costs you
2. One price for everyone - Different segments have different willingness to pay
3. Never changing prices - Pricing should evolve with your product
4. Hiding prices - Transparency builds trust
5. Too many tiers - 3-4 options maximum
6. Feature overload - Differentiate on outcomes, not feature counts

Your Pricing Action Plan

1. This week: Interview 5 customers about pricing
2. Next week: Analyze 5 competitors' pricing pages
3. Week 3: Calculate the value your product delivers
4. Week 4: Design your pricing page with 3 tiers
5. Month 2: Test a 20% price increase on new customers

Remember: You can always lower prices, but raising them is harder. Start higher than you think, and adjust based on data.

The right price isn't the one that gets the most customers. It's the one that maximizes revenue while attracting customers you can serve well.