How Pricing IO CEO Marcos Rivera grew Pricing IO to $5M revenue with a 10 person team in 2024.

hey folks my guest today is marcos rivera he's the founder and ceo of pricing io a b2b sas pricing expert who uses street smarts to help companies capture value and unlock growth with over 20 years of experience he has a knack for effortlessly delivering complex ideas helping his clients out leaving them feeling more confident again now building pricing io.com marcos you're ready to the top i am let's do this all right so you've also got a book coming out which i'll talk about in a second but first uh pricing um io when did you launch the business what year 2019 i launched in the summer of 2019's for about three years old and i see verbiage related sort of services on the website are you building are you flirting with sort of software on the back end yet or is it all people yep so today it's all people although i think the ultimate goal would be to start introducing some tech behind the scenes uh to start introducing some other levels of scale uh but at this stage we are full on services all people some of it uh most of it being one time and some of it recurring the reason i love this is a lot of the most successful sas companies come out of agencies so maybe a year two year three years from now you're sitting on a billion dollar sas company right and it started off here free revenue with just an agency so tell us about the agency what what are you selling so right now we help sas companies figure out their monetization strategy how to price for what they're building um and we do that through uh combination of coaching and consulting right so the idea is to help them learn how to price as well and the big reason for that is their their products could be changing a lot their customers change markets change competitors change so they need to stay on top of how they monetize their value uh which is the best way for them to get to their growth goals and so if someone wants to hire you to do this are they like are you committing making the commit to a 5k for three months sort of deal or what's the average retainer look like yeah so from our perspective we do it in very focused uh sprint projects and so i don't think folks need to pay half a million dollars in six months to get their pricing right so we have uh projects for four weeks that are eight weeks 12 weeks and we work with the companies we do the heavy lifting on getting the data we'll coach them on here's what all this stuff means and how do we figure out your pricing and packaging and then we actually uh build it and then help them with how to figure out implementing it too like how do you design skus to you know how do you figure out how to compensate your sales people uh the right way so if i was going to pay you for a 12 week sort of engagement i guess what might i pay for that yeah so our if i had to think about our curve the the bell curve for our engagements can be anywhere uh the majority paid between anywhere from 25 to 175 k higher engagement some on the smaller end and some on the higher end but that's the general uh what we look at for what we uh what and what do you price again so someone paying you 25k for 12 weeks versus 275k for 12 weeks it just depends on the number of seats or number of customers they have or their current mrr yeah there's really there's really three things the first one is how many products are we pricing here is it just one main application do you have like a bunch of products in a portfolio um the second thing is uh complexity in terms of your markets and models do you have channel partners versus direct versus plg or something self-serve how many models are we dealing with here and then the last one is how much help and support do you really need like do you need us to hold your hand as all the way you're through implementing or do you just want the data and the answers and then you run from there okay super interesting um by the way you said half a million bucks for an engagement was that a shot at a price intelligently no just uh if you think about it uh all the the simon couchers out there mckenzie's bane if you ever run a project with them it's going to be in the very high six figures to even millions and minutes are the other players are specific to sas pricing you who else yeah i would say price intelligently comes up a lot or profit well uh i know that they may be shifting a little bit with the recent announcement with paddle and everything they're doing but uh but they do a great job of offering some good survey services to figure out willingness to pay things like that which a lot of folks take run with and use but they don't really get into how do you implement this stuff like how do you actually figure out uh how do you put implemented discounting matrix how do you make sure that you can actually uh pull this off on the other end how do you do execute a price increase for example all those things uh we get into uh and that comes from you know a lot of the value creation background that i have oh what's going on there youtube good to see you guys now imagine this you love watching these interviews with sas founders but imagine if we took all of the valuation data out from over 2807 interviews i've done manually saves you a lot of time well we've done this we've built it into the beautiful interface inside of founder path check this out i'll show you how you can access this in a second but you log in you connect your stripe account you see your valuation real time you can see what it changed over the past 88 days and even set goals for valuation this year now the secret evaluation is there's many different ways to value a sas business so the reason you're going to see three or four different valuations inside of your frowner path dashboard this is all free by the way is because depending on who's doing the buying of your sas company you're going to get a different valuation a vc is going to pay a different valuation private equity firm is different if you're going to do a minority sale that's different and if you sell the whole business that's a different valuation you can see all those when i hover over here right so the teal is what a vc would pay yellow is what private equity and red is if you sold the whole thing outright now what's cool about this is this is not built off random data again you guys hear these interviews on youtube all these datas are built from real-time valuation data points founders share with us on the show so traction 1.2 million seed round 3.7 raised they sold 22 of their business go in here and filter by the event maybe you only want to see companies that have sold the whole business well here are a bunch that have been acquired the valuation and the multiple maybe you're going out right now and you're raising your seed round well go in here and look at all this recent seed deals that went down what they raised what valuation they raised at and what percent that they sold there's never been a larger data set of sas valuations than what you can get now inside of founder path and we're thrilled to bring it to you all right we're going to go back to the youtube video here in a second but if you want to check this tool out if you want to jump in and sign up you can check it out for free to get your valuation at this link this link founderpath.com forward slash products forward slash evaluations or if you go to founderpath.com and hover over products click on get your evaluation here and go ahead and sign up to give it a whirl again all that valuation data live right inside the platform i hope to see you there all right let's jump back into the interview i want to get into some of those playbooks here in a second but what do you know i mean what is profit while charging these days for these sorts of things is it half a million and bigger no so profitwell you know believe it or not i actually had someone tell me uh just a couple weeks ago they said yeah profit well today won't even get out of bed for 250k quote what he said now i i think their engagements do kind of range around that low six figures uh from what i've seen and they have different models out there but yeah that's that's what he told me as his last conversation with him yep okay so let's just just so people can get really getting your heads i want you to get sort of street cred with my audience i don't want them to see you as just like a consultant right so tell us about how you helped the sas company executed price increase and what was the result yeah absolutely so i'm actually not much of a consultant i'm more of an operator because i've built software and sold it my whole life uh which is a funny story but the wheel the real deal here is how do i help companies figure out how to price so the first thing we do is we get into where is the growth coming from like are you actually going down market up market are you trying to increase your profit are you trying to gain a bunch of you know market share or network effect that's going to tell me okay which uh which options are available to you from a model perspective then we get into your customer base who are you selling to and no small medium and large is not good enough anymore i actually help them figure out either on...