Frame Pricing as ROI Share or Justified Range

When potential customers push for pricing information early in the sales process, most founders make a critical mistake: they provide a single price point that becomes an anchor, often too low to capture the true value they deliver. Madhavan Ramanujam shares a powerful negotiation tactic that reframes the conversation around value rather than cost.

Instead of responding with a specific price when pressed, use one of these two value-based framing approaches:

The ROI Share Approach

When customers insist on knowing your price, contextualize it as a fraction of the value you deliver:

"For customers similar to yours, we've been able to unlock $10 million in value in very similar situations, and our pricing is typically a 1-to-10x ROI. So you're getting a 10x return on your investment with us."

This brilliant framing accomplishes several things simultaneously:

• You've implied your price is around $1 million without directly stating it
• You've anchored the conversation to the $10 million in value, not your fee
• You've established your pricing as reasonable (taking just 10% of the value created)
• You've shifted the conversation from "how much does it cost?" to "what value will I get?"

The Range Approach

If they still push for a specific budget figure, provide a range rather than a single number:

"The final pricing would be anywhere from $500K to $1 million. Based on the business case we would co-create with you, we can pick a point in that range that justifies the value we bring to the table."

This approach:

• Gives them the budgetary guidance they need
• Maintains flexibility in your pricing
• Keeps the focus on value-based pricing
• Avoids locking you into a specific price before you've established the full value

This tactic is particularly crucial for AI companies, where the value delivered can be 10x higher than traditional software, but founders often undermonetize by using old SaaS pricing playbooks. The winners in AI will be those who master monetization from day one, contextualizing their price based on the substantial value they create.