SaaS pricing calculator
Stop guessing your monthly price. Work the math from the LTV / CAC / payback your business actually needs.
What this tool does
Most early-stage SaaS founders pick a price by looking at competitors, picking a number that feels reasonable, and hoping it works. It almost never does. Pricing should fall out of the unit economics you need — not the other way around. Start from what a healthy business looks like in your category and back-solve the monthly price that makes it possible.
How to use it
- Decide the LTV/CAC ratio you need (3:1 minimum for venture-scale; 1:1 if you're bootstrapping for cashflow).
- Estimate your CAC honestly — fully loaded.
- Estimate your monthly churn rate. Customer lifespan in months is roughly 1 ÷ churn.
- Estimate your gross margin.
- Required ARPU = (LTV target × CAC) ÷ (lifespan × gross margin). That's the floor your monthly price has to clear.
Why it matters
Underpricing is a fatal SaaS mistake because it compounds — you set the floor, then anchor on it for years, then can't raise without churning your base. Get the price right at launch and you'll have the room to invest in product, support, and growth. Get it wrong and you'll be stuck running an emergency room for a margin-poor business until you eventually shut it down or rebuild from scratch.
Questions people actually ask.
How often should I raise prices?
For new customers, any time you can — pricing experiments are nearly free. For existing customers, grandfathering or a once-a-year polite increase with notice is the gentle approach. Software prices going up after years of value delivery is reasonable; act like it.
Should I offer annual plans?
Yes, at roughly a 15-20% discount versus monthly. Annual plans massively improve cash flow, reduce churn, and select for serious customers. The discount pays for itself many times over.
What about freemium?
Useful when paid conversion is high enough to subsidise the free tier and the free tier creates real distribution. Dangerous when free users cost you support time but never convert. Run the math on a freemium funnel before launching one.