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Manny Medina

04/22/25

@ Sequoia Capital

AI can facilitate bespoke contracts that align with customer value, moving away from rigid pricing models and allowing for more tailored agreements, which are essential for AI companies to effectively manage pricing and value delivery.

Video

Pricing in the AI Era: From Inputs to Outcomes, with Paid CEO Manny Medina

@ Sequoia Capital

Pricing in the AI Era: From Inputs to Outcomes, with Paid CEO Manny Medina

04/22/25

Related Takeaways

Aaron Levie

02/20/25

@ Y Combinator

The pricing model for AI services is evolving; companies might pay for successful outcomes, qualified leads, or resource utilization, reflecting a shift in how value is perceived in AI-driven businesses.

Manny Medina

04/22/25

@ Sequoia Capital

AI companies should align their pricing with what matters to their customers after demonstrating value, rather than relying solely on fixed or consumption-based pricing models.

Manny Medina

04/22/25

@ Sequoia Capital

Charging by activity and changing pricing based on workflows are effective strategies for AI companies, moving towards value-based pricing rather than cost-based pricing.

Y Combinator Cast

01/25/25

@ Y Combinator

The pricing model for AI tools is shifting towards usage-based pricing, making it easier for companies to justify ROI and shorten sales cycles.

Manny Medina

04/22/25

@ Sequoia Capital

To succeed, AI companies need to understand their unit economics and how to price their services effectively based on the value they provide.

Manny Medina

04/22/25

@ Sequoia Capital

Paid provides infrastructure that helps AI companies transition from simple activity-based pricing to more sophisticated value-based approaches, enabling them to capture their fair share of the value they create.

Manny Medina

04/22/25

@ Sequoia Capital

Agent-based pricing allows companies to charge based on the work done by AI agents, which can replace a significant portion of traditional sales development roles.

a16z Cast

05/02/25

@ a16z

Value-based pricing is common in AI applications, where vendors charge based on the perceived savings or value they provide to customers, rather than just margins.

a16z Cast

05/02/25

@ a16z

Pricing strategies for AI agents can vary; if the service is used by humans, it may follow a per-user pricing model, while machine-to-machine services might adopt usage-based pricing.