Rebecca Mincy, Former Portfolio Manager, Acumen

How should entrepreneurs really think about their pricing?

It's really tough. There's always the kind of, what are my competitors selling their product for?

So there's a benchmarking part so that you are maybe the low cost provider, or if you want to provide a superior product and have your brand be perceived as a superior product, then you can go a bit higher.

A lot of times it's a benchmarking exercise, which doesn't sound so sophisticated, but I think it's probably true.

It's certainly one of the things that we look for when we are assessing a company's ability to scale. We do go out and we look at who else is in the market and what are their pricing and what is their positioning.

Because pricing, it's important in terms of making sure you cover your costs and unit economics. It's also an important signal to the market as well in terms of how your product is positioned relative to other things.

There's a bit of branding and market positioning that goes into your pricing as well. So you almost have to decide who you are and who you want to be in the market and have your pricing be a part of that.

Key takeaways

• Evaluate your competitors’ prices to benchmark your product

• Pricing reflects your market position - decide who you are and align pricing with desired brand perception