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Comment by cschmidt | Hacker News Reader

Pinboard has a slowly increasing price as more users join. It was only $4.21 the day I signed up, and is now up to $9.25. I'm really glad I joined before the onslaught. :-)

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With the signup fee currently at $9.25 and a pricing scheme of

  fee = (number of users * $0.001)

that means there are currently approximately 9250 registered users. Who remembers calculus and can calculate how much revenue they have generated, assuming their signup fee started at $0.01?

The pricing scheme is (number of users * $0.001 * C) where C is a multiplier that has changed with time. On top of that a significant portion of total revenue comes from archival accounts.

This urge to reverse-engineer our total number of users when I actually share that information in the post baffles me.

Reverse-engineering is much more fun

"where C is a multiplier that has changed with time"

Well, there's your bug :D

Assuming the fee as a function of users is linear and started at zero, the average user is paying 1/2 of the current price. So if the current price is $9.25, the average user is paying $4.625 per month. So they have made 9250*$4.625 = $42,781.25.

It isn't per month -- it's a one-time signup fee.

Archiving is annual.

I didn’t realize it was a one-time signup fee. Thanks for pointing that out.

You don't exactly need calculus for that one, just n*(n+1)/2. That works out to $47,785.875. Assuming they round up to the nearest penny on each transaction you get $42,827.50.

You don't need calculus. The mean price per user is $9.25 / 2, so they have taken in about 9250 * $9.25 / 2 = $42,781.25.

Not bad!

maciej has stated previously[1] that his revenue is greater than the $42K-$47K being approximated:

> Right now it's 18k users, with 11k active. The signup fee has brought in just over $120k, most of that coming in December (thanks, Yahoo!).

[1]: http://news.ycombinator.com/item?id=2205417

That's a really interesting pricing model. I should rummage around and see if he's mentioned why he chose that.

I got the idea from joshu. I wanted a gatekeeping fee for spam prevention but had trouble figuring out what to charge. He suggested a monotonically increasing signup fee.

Are you increasing the rates for Archival accounts, too, or just the Basic?

Archiving has always cost $25/year, and will stay that way. Only the signup fee goes up.

The practical result is that the upgrade becomes progressively cheaper (since the signup fee is deductible from the first year's subscription)

Archiving is the best deal around. $25 and I have 1.25GB of my past ten years of bookmarks saved. (Minus a few hundred dead links from the early days of del.icio.us.)

I bookmark so I can look at something later, and the unpredictable perishability of the web defeats that purpose. Archiving snatches victory from the jaws of defeat. :-)

I would like to see tag hierarchies à la del.icio.us, if you were bored and wanted to implement them.

At some point you're losing more potential users than you're gaining because the price has gone too high. Do you think about that? How will you handle it?

I've deferred worrying about it until it happens

I would suggest, once you cap it (at whatever rate) -- divide the rate by 12 and make it a recurring charge. For example, let's say you notice sales decline, and decide to cap the charge at $12 - change the structure so that instead, you bill each new user at a rate of $1 per month (with optional pre-pay discounts or yearly prepays or whatever).

If you can keep the users for 1 year, you'll have made more than the $12 cap you would have and, if you don't, at least you don't have the support headache of having to deal with a customer who bought in at the minimum for life -- non-paying users at this price tier go away. Plus, anybody willing to break out their wallets at all are likely to have little qualm over $1 a month.

Also, with a fairly regular income stream, it'll allow you to plan your expenditures more reliably, so budgeting for things like employees, server space, etc will be easier to plot out cost vs income.

$5 seemed reasonably, $10 is too much. For me at least.

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