Ready to break free from the ordinary?
Many Startups are working on technologies that just a few years ago didn’t even exist. They weren’t even possible, maybe not even a dream. Technology is evolving fast and so are the new and innovative ideas that come along with those advancements. And the question I often get from people is “How do I price something that’s unknown?”
Do the same tactics and strategies apply? How can I help my customer understand the real value when they can’t even conceive this as a possible solution? Truly innovative solutions push the boundaries of value and often require an innovative approach to pricing as well. It’s true that this can be tricky but it can also be incredibly exciting.
That’s one reason why I’ve invited this week’s guest to join me on the show.
In This Episode
Cristina Ruiz de Castaneda, Founder of Blue Vega started her business after working with a really great consultant during her corporate days. She now consults herself, helping innovative Startups with new technologies develop their commercial roadmaps.
She shares with us her own pricing journey. Then we dive deep into the captivating realm of strategies for pricing unique offerings. From understanding the unconventional costs to gauging the value for early adopters, Cristina sheds light on the myriad fascinating factors that come into play.
But that’s just the beginning! Cristina also shares some of the common mistakes startups make when pricing their innovations. Get ready to gain fresh perspectives, practical insights, and inspiration to navigate the intricacies of pricing your own unique offerings.
Podcast Episode Highlights
- 0:00 Intro
- 1:49 Getting to Know Cristina
- 3:30 The Value of Working with Cristina
- 6:10 How Did She Get Started
- 8:19 Pricing At the Beginning
- 10:47 Pricing of Unusual Things
- 14:13 Common Mistakes Startups Make
- 19:27 Looking through Multiple Lens
- 22:53 Wrapping It Up
“Clarity is the last one (value I bring) because, when you know where you’re going, you can be aligned in your company.” Cristina
“It’s not always throwing in the towel. I guess that there’s a point where you may want to do that as well, but, It’s about having that flexibility and learning the skill of when to keep trying and when to let go and things like that. And it was hard.” Janene
“It’s fundamental that you know who you’re targeting. Do interviews. Do very practical thing to find out who they are. It would be a shame to spend six months on messaging and communication to find out it doesn’t work.” Cristina
“Find the knowledge in people because they have lived through it or they have learned it. Many people are so ready to give you advice. Find, of course, good people you trust.” Cristina
“Put yourself (i.e. position your offer) where more or less you think it’s fair and then grow with time.” Cristina
“I think too often people just look at what everybody else is doing, that’ll be the right price for me. Or if I just add up my costs, that’ll be the right price for me. And actually, it’s not, something that you should look at through one lens. It should be looked at through multiple lens.” Janene
Reach out to Cristina:
Cristina’s Book Recommendation; Venture Deals
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Janene: Today I would like to welcome a very special guest, Ms. Cristina Ruiz De Castañeda. Hi Cristina.
Cristina: Hi Janene.
Janene: So lovely to have you here.
Cristina: Thank you for having me. Pleasure.
Janene: Why don’t we start with a few rapid-fire questions, and the first one is, where are you joining us from today?
Cristina: I am based in Zurich, Switzerland.
Janene: Yes. We met at the female founder of Switzerland. Hello to all our other female founders from. What would you describe as your superpower?
Cristina: Well, if I would ask people around me, they would probably say something like, when she has a task at hand, she gets into this hyper structured way of processing. I would say really structuring a problem, trying to break it down. That’s something I have the tendency to do and use it in, in at my work a lot.
Janene: Super excellent. Great skill to have. What’s one interesting thing that people don’t know about you?
Cristina: Well in contrast to the hyper structuration, the other thing is basically that painting is my passion.
I’ve been painting since I’m little. It’s really the contrast because it allows me the freedom to actually have no constraints, no structure, and the freedom of creativity.
Janene: Oh, that’s great. Do you have your drawings or paintings somewhere that we can look at them?
Cristina: Well, it’s a mess. Imagine it’s full of canvases and color and chair is covered in color. So yeah.
Janene: I love it. Cristina, what is it that you do and what kind of value do clients get from your service?
The Value of Working with Cristina
Cristina: I’m a commercial consultant for early stage and small companies, and what I do is, we’re built together with them, the commercial roadmap that is basically where your company is today, where your company, should or where you want it to be in the future and how to get there.
We do that in materializing the vision into concrete numbers and developing an actionable plan to get to those targets. The value I would say I work myself in startups is three things. First, build confidence. Confidence in your own numbers, in knowing your business very well, your technology very well in terms of, let’s say the commercial aspect and know where you’re going.
I think when you know that, and when you have a plan, you are also transmitting or sharing. With confidence in building trust on the other side when you’re acquiring investors or when you are talking to potential partners or customers. The other point is time. I help them do things that they cannot do because they’re overwhelmed with all the other stuff, and it takes us maybe a workshop of two and a half days.
I helped them with all that thing, the research, and the strategy and all these things that they often don’t have the time. And I think clarity is the last one because, when you know where you’re going, you can also be aligned in your company. It’s very motivational to know where you’re going.
I’ve worked with companies where they weren’t completely aligned and there were different expectations, and that can be not only, not motivating, but demotivating. I think this is a package of having a clear aim.
Janene: I love that. Excellent. Thank you for sharing that.
It’s such a Tough Job
Janene: It’s such a tough job starting a business for most people. If you’ve never done it before or you don’t have someone dear to you who’s done it and you knew what they went through. Yeah. A lot of people go into starting a business, underestimating what it’s gonna take. Not just mentally, but also physically. Energy wise. And knowledge wise, all these things you have to learn. It’s fantastic to have people out there to support your business.
Cristina: Absolutely. I mean, anybody who’s supporting, not just me, but really to give them the chance at having a fair shot at that idea that they have. That’s a pretty thing.
Janene: Cristina, why did you get started in this, or how did you get started in doing this?
How Did She Get Started
Cristina: It’s a super old idea I had but it’s in my head. I worked already in the past with a venture capital firm in or from the other side of the startups where the investors are.
I worked in large companies. I worked as head of sales and marketing in a startup and that’s where it happened. We had to take so many decisions and we were quite under pressure and that we needed to all pull from the same rope.
One day we had a consultant, he stayed with us two days. It was the best experience apart from all I learned in the company. It was really all about knowing where’s the company and where do you wanna go? The company, where’s the best, most suitable market to invest in the next year? Very specific. It never left my mind.
I never found this man again. I’ve been searching but I took the idea and changed it in a way and turned it into what I think is the best tool is a commercial roadmap. Have to buy company. This is what I love to do.
Janene: What is it you love so much about it?
Cristina: I love to first dive into an organization of very enthusiastic and knowledgeable people who have an idea and the process of turning that idea into something more real. This is a process I just love because it is exactly what I said at the beginning. It’s structuring something, breaking it down, and going for it, not let’s go with here, let’s go with there.
The tendency of deviating as a startup is so big. I think it’s just nice to know to have a path, even if the path might change a bit because it’s a startup.
Pricing at the Beginning
Janene: When you first started your business and you sat down and you had to fix some prices, what was that like for you?
Cristina: I probably was one day completely overwhelmed, like, no, I cannot charge this. I was looking at lists of consultants pricing and in different areas, market research for sure. I was looking, what is the market charging then I stopped. That’s fine. I went to the other side, which is for me, what is the value I bring?
If I had startup, what’s the value in materially? What am I helping? Then also try to monetize it in a way also saving time. It is a bit hard to monetize because I think at the end there is a lot of information and knowledge that goes into these workshops, but I think the approach was to mix methods.
Yes, market research, yes value-based, cost-based approach to pricing, not really. I think as a consultant, yes, you need resources in terms of maybe digital resources or descriptions to information. But that’s for me not that important.
Janene: Did it feel easy to you?
Cristina: Not at all. I think I was very exciting because I love to do market research when it’s for yourself. There is always this element of. I try to really understand what a consultant was offering to be clear about what am I offering and somewhere put myself out there and feel. The point is to put yourself where more or less you think it’s fair, and then grow with time.
A Dynamic Thing
Cristina: Pricing is a dynamic thing. We shouldn’t look at… and you mentioned it, you’re the expert. You mentioned it many times. It keeps evolving. Find the price that you feel fine with it. Maybe you’re underpriced at the beginning, but then just go step by step and find your confidence and raise your price if necessary.
Janene: That’s great. Thanks for sharing that. It’s always interesting to hear how different people approached it at the beginning and for those who are watching to understand that if they’re struggling with it, it’s normal.
Cristina, I’m curious because one of the things that we talked about before we got on this call today was pricing of unusual things. I’d like you to share with us a little bit more about what you mean by that, and maybe have some examples you can share.
Pricing of Unusual Things
Cristina: I will, let’s say, bring the example for my work now.
As a consultant, my focus is mainly on Cleantech startups, but I also advise others Cleantech technologies that make better use of resources more efficiently and find or maybe use renewable, and energy sources. This is a bit too fine cleantech and these are often, or sometimes, technologies that either don’t exist yet or that are being built at as we speak.
One good example is a hydrogen powered vehicle. This is not a new vehicle. It has been existing now for a few years, but it has not yet been used as a widespread mean of transportation. Their pricing is an interesting point because you have a completely new set of costs compared to a regular car that works with gasoline.
You have other materials, you have another assembly way, and then also you have another infrastructure. What’s interesting is how do you price that? What you cannot look at the market and say, sure. They’ve been doing it like this because of this. There’s a whole history.
No, it’s a new technology that not only costs differently, but also have a new value. Especially for people like early adopters that are maybe tech savvy users that are super excited about a hydrogen part vehicle. Maybe they’re ready to vape to pay a little more. There is also on the other side, the price sensitivity of the user, of the customer.
There’re other elements that flow into this new price for a hybrid powered vehicle. I find that super exciting. It is then even more complicated because you have no reference, but I think it’s really to find the logic and market readiness.
Janene: I mean in a lot of cases when you’re working with things like that, we use something called value stacking where we use a reference and then as the comparison point, and then you look at what is the additional value, and you can stack on top of that.
That’s often used for things that are, let’s say unusual or new in the market, but you have to be really careful because oftentimes if you say, well, it’s just like this, but it’s not, then you give people that reference and it destroys the value,
Cristina: Can get confusing.
Janene: I think the most unusual thing I’ve priced was lab mice.
I had a client, it was one of my very first projects when I started my own business, and they needed, it was a university needed, who needed help. Trying to figure out how to price the lab mice that they were selling, I didn’t know was super. Oh yeah. It was quite interesting.
You work, cause you work with a lot of startups. You see a lot of behavior good and bad. I’m curious, what are some of the mistakes that you commonly see startups making when it comes to their pricing?
Common Mistakes Startups Make
Cristina: I think it’s (i.e. a common mistake) the time span or the midterm, long term and the short term. They are very anxious sometimes. Even if they decide for a strategy, a pricing strategy, they might have the tendency to very quickly say, it’s not working. We don’t have time that this should be moving. You know? And I think time is sometimes against Startups. And I think that’s a shame because also, again, this is why maybe you need a well-informed ground of decisions.
I’m not saying it’s perfect. I’m not saying it’s going to immediately give you all the answers, but to feel that whatever you’ve decided, Pricing, for example, go with it for the why you’ve decided, because the fruits come sometimes a little later or a little, or, or it takes a bit more time, but sometimes I’ve been feeling the times I mentioned.
Somewhere has become very short term and success needs to happen immediately. And obviously, financing plays a role, but it takes a bit of time.
Janene: The time. That’s a good point. I mean it’s hard when you’re in those early days of a business to be, let’s say, patient when you’re trying to get to those first clients and get that profit engine, to get it greased and going a little bit. It’s very hard to be patient. I think you’re right That’s something they struggle with.
Cristina: or keep insisting even. I mean, in not only patient, but try again and try again. But I think I talk to so many startups, also, relation to the female founders and then so many good conversations and, and they say it’s really, you need to try again and again.
Know when to Change Things
Cristina: It gets better because you also know now what they want to know, and you understand also why they wanna know it. That’s also what I mean by time, really try again. Of course, when you’ve been trying for three years, you also need to know when to give up.
Janene: Or when to change things, right?
It’s not always throwing in the towel. I guess that there’s a point where you may want to do that as well, but, It’s about having that flexibility and learning the skill of when to keep trying and when to let go and things like that. And it was hard.
Cristina: It’s hard and I don’t know, I feel a lot for them, and I feel with them because I’ve been there, I know it’s hard.
I think I really hope that when they work with me, they get a bit of a security and then again, of a bit of an impulse to say, let’s go.
Janene: That’s interesting. One thing that I’ve seen, I was talking with somebody, I was at a startup event over the weekend.
Back to this, if you have something unusual that you’re pricing. I forget what it was, but they were, they said, this is what we’re bringing to the market. It’s kind of like this, but it’s better. So how much more can we charge?
I said, well, first, why do you assume that people are gonna be willing to pay more for it if it does the same thing? No, you also have to be careful with making these assumptions and one of the things that I always emphasize with people is the importance of understanding who you’re targeting.
What’s your experience with that?
Cristina: I agree with what you say. It’s fundamental that, you know who you’re targeting. But how do you know. You need to put yourself out there and maybe even, do interviews. You know, very practical thing to find out because it would be a shame that you’ve been spending six months on messaging and communication when in fact it’s point or the person, you know, or the customer.
I think that’s the first, is really who are you selling it or who are you, who do you want actually, purchase whatever you are you’re offering and why? Why is it gonna be such a great thing for them? And it’s so. But it’s not always easy to answer that question.
And again, when you have maybe three founders in a startup, it could be that they really don’t, they’re not talking about the same thing, so mm-hmm. In a way, just really be on the same page. And yeah, I think that’s important.
Janene: Yeah. I think especially when you’re in a startup where there’s a team of people listening becomes probably one of the most important skills that any of the individual team members have, right?
Cristina: Yes. And listening outside. Talking to people, you know, go and invite someone for lunch that you know, Hey, this person, they just know a lot about this topic and go listen or go and ask.
Looking through Multiple Lens
Janene: Right. Cristina, we’re gonna start wrapping this up now. What’s one thing in your experience around pricing that you’d like people to take away from our discussion today?
Cristina: I think, when you’re doing pricing, maybe my lesson learned is use a mixed approach. Look at the market, but also try to figure out that what’s the value of your product, your technology for the customer, and try to basically bring two different lights or three different lights into this topic.
In order to look at from several different perspectives and to get, get a better grip on why your pricing should be like that.
Janene: I think that’s an excellent point. I think too often people do try to, just look at what everybody else is doing, that’ll be the right price for me.
Or if I just add up my costs, that’ll be the right price for me. And actually, it’s not, something that you should look at through one lens. It should be looked at through multiple lens. That’s great. I love it. Thanks for sharing that. Cristina, what’s the best business advice you’ve been given over the years?
Cristina: I think, it’s maybe also a life advice is, basically when you have a problem or a task or whatever that comes in, deal with it as best as possible, but doesn’t need to be perfect and get it out. Don’t being stuck. Don’t hold onto it for too long. there’s many things that arise, find a good solution and let it go again.
Janene: Yep. That’s great. It’s easy to get stuck. We’ve all been there.
What’s the most amazing thing that you’ve overcome in your business?
Most Amazing Thing
Cristina: I would say, go and talk to people out of the blue. I love to talk to people. I admit this probably is my Spanish side. I love to talk, but I think it’s different when you go and talk on a personal level. But then if you go really, and you’re trying to meet new clients and explain to them what you’re doing and how you could work together, I think that’s, I’m very happy to be doing it.
I’m learning so much every single time, but I think it’s, how you say in German you say practice.
Janene: It’s practice. Absolutely. Do you have a favorite book tool, podcast, or something you’d like to share with the audience?
Cristina: I’m reading now, book called Venture Deals.
I’m reading it in German, but I think it’s probably in English as well. It’s a deep dive into venture deals.. So everything from the legal perspective, the management, everything. And my thing is I’m not reading so many books. I read a lot during the pandemic and I’m done. I read, I want to see people again, my Spanish side.
My advice honestly, is, Find the knowledge in people because they have lived through it or they have learned it. Many people are so ready to give you advice. Find, of course, good people you trust. But there is really a lot of really, knowledgeable people out there.
Janene: Yeah, this weekend I was at the startup weekend here in Basel and it was fantastic. It was good to be around anybody, everyone. The energy was so great and so many great business ideas. It was really something special. I think in some ways, some of us at least, are starved for those kinds of things.
Wrapping it Up
Janene: One last question. How can people reach out to you if they’d like to find out more about working with you?
Cristina: They can go on my website and book a call straight like this. I’d be super happy to talk to them. It’s free of charge, not that some people think, I charge them for a call. Or just contact me on LinkedIn. Yeah.
Janene: Great. Thank you so much for joining me today. It’s been such pleasure having you on the show.
Cristina: It was lovely. Thank you very much for having me though
Janene: Great. All of you who are listening out there, thank you for joining us today. I wanna share with you one more thing before we go. I have a new course coming up called Fair Price Formula. This course is all about how to set your prices. I will take you through step by step, how to find a fair price for what you offer.
If you’d like to know more about this, you can head on over to Maven and type in pricing and you’ll find the course, the Fair Price Formula on their course list. If you have any questions, you can always book a call with me at thepricinglady.com/book-a-call-with-me. Otherwise, I wish you a great day. Have a wonderful time, and as always, everyone enjoy pricing.