So there’s a lot of talk in B2B and AI about the per-seat model being dead.  That per outcome pricing and other AI pricing models will kill it.

Well maybe.  But it doesn’t seem so … yet:

• Open AI itself still gets most of its revenue from per-seat pricing!
• HubSpot and other leaders are doubling down on per-seat pricing.
• The majority of Shopify revenue is from payments and merchant services, not even software.  Same with Toast.

• Vertical SaaS leader for construction Procore at $1B ARR charges per project volume and per product, not per seat.
• Monday, Asana and other leaders are using a “some is included in per seat pricing, beyond that you pay per usage” AI model.  Even that though it still an experiment and the revenues aren’t yet truly material.
• Most Vertical SaaS companies I’ve invested in have hybrid models, with 40%-60% of revenue from payments and other services.
• Most API-driven models were never seat based in the first place.  From Twilio to Snowflake to Databricks to Stripe, none of these ever priced per seat anyway.
• Ultimately, it’s not even clear how much of this “per action” pricing will stick.  Will customers really pay Salesforce $2 per action in 2027?  Especially as basic AI costs fall an order of magnitude every few months?  We’ll see.

One point folks often miss: the per seat model was never even 50%+ of all SaaS pricing before AI.

Yes, many of us learned from Salesforce and many of us build and sold sales and marketing-related tools and thus also used seat based pricing.

But even in 2021, only 47% of SaaS companies priced per seat:

I’m not suggesting pricing models aren’t rapidly evolving with AI.

It’s just don’t kill the seat — if it works.  Don’t kill the seat where is the model that works today for the customer.

Don’t look down on per-seat pricing.  It was never used by the majority of B2B apps.  But it will still have its place going forward.  In whole, or in many cases, in part, in hybrid pricing.

AI is highly disruptive in SaaS, and that disruption is accelerating.  It’s just, I’m not so sure in the end it will disrupt pricing as much as many in social media think.  Let’s just see.  In the end, the easiest way to close a deal is pricing that’s similar to other products a customer already buyers.

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• Source: https://www.saastr.com/the-per-seat-model-isnt-dead-it-also-surpisingly-was-never-dominant/