Most founders make their pricing decisions tactically. They look at competitors, estimate what customers will pay, set a price that feels reasonable, and adjust occasionally when the numbers suggest a change is needed. This approach is intuitive and almost universal, and I want to argue in this piece that it produces ventures that arrive at year three or year four with pricing positions they did not deliberately choose, that are now expensive to change, and that constrain the venture’s future in ways the founder did not anticipate when the early prices were set.
The framing I have come to use instead is that pricing is a trajectory rather than a decision. The price you set today is not just the price for today’s transaction; it is the first point on a multi-year curve that customers, competitors, and your own organisation will collectively reinforce. The trajectory you are committing to with that first price is harder to change than founders realise, and the founders who think about pricing trajectorily from the start arrive at year five with positions that compound, while founders who think tactically arrive at the same year stuck in pricing structures they cannot easily escape.
This piece is about what trajectorial thinking actually looks like, and why the founders who do it consistently end up with stronger ventures.
The three trajectories every venture is implicitly choosing
Every initial pricing decision puts the venture on one of three trajectories, whether the founder names it or not. The trajectories diverge over time and become harder to switch between.
The first is the upward trajectory. The venture launches at a price calibrated to a higher-end segment of the market, with quality and positioning to match. Over years, the price rises in line with quality improvements, brand strength, and the venture’s growing reputation. The customer base self-selects for value-buyers who pay willingly, refer at high rates, and tolerate further price increases as the relationship matures. The unit economics improve over time. The venture compounds toward a position of pricing power that competitors cannot easily replicate.
The second is the flat trajectory. The venture launches at a moderate price and holds it roughly constant over years, occasionally adjusting for inflation but not pursuing structural increases. The customer base is mixed. The unit economics are stable but not improving. The venture is operating successfully but is not building the pricing power that the upward trajectory produces. This is a defensible position; not every venture should be pursuing pricing power, and the flat trajectory is appropriate for ventures that are competing on volume, accessibility, or specific operational efficiencies rather than on pricing leverage.
The third is the downward trajectory. The venture launches at a price calibrated to volume capture, with the intention of compressing prices over time as scale economies improve. The customer base is price-sensitive by selection. The unit economics depend on volume to compensate for thin margins. The venture compounds toward dominance through cost leadership, with pricing as the central competitive lever. This is a viable trajectory, but it is the most demanding to execute because it requires operational discipline that most ventures cannot sustain across the years required to make the volume work.
The mistake most founders make is to launch without choosing among these three deliberately. They set a price tactically, by referencing what competitors charge or what the market seems to bear, without recognising that the price puts them on one of the three trajectories. Then, eighteen months later, they discover the trajectory and find that switching to a different one is structurally difficult.
Why switching trajectories is harder than founders expect
The structural difficulty of switching trajectories is one of the most underappreciated facts in early-stage pricing.
Switching from a downward trajectory to an upward one is the hardest move. The customer base has been calibrated to lower prices. Raising them to upward-trajectory levels typically loses most of the original customer base, while not yet having the brand strength or product positioning to attract upward-trajectory customers. The venture spends a difficult eighteen-month period with reduced revenue and weaker positioning, hoping the new positioning will attract enough new customers to compensate. Many ventures do not survive the transition.
Switching from an upward trajectory to a downward one is also difficult, though for different reasons. The cost structure has been calibrated to higher revenue per customer; lowering prices to volume-trajectory levels means cost reductions that the operational team often cannot execute quickly. The brand has been calibrated to premium positioning; suddenly competing on price corrodes the brand. The customer base, which had been paying premium prices, feels betrayed when prices drop and the venture loses some of its strongest relationships. The transition is structurally messy and rarely produces the volume growth the founder projected.
Switching to or from the flat trajectory is easier in either direction but still costly. The venture’s customer base, brand, and operations have been calibrated to the flat trajectory, and any meaningful change requires recalibration across all three.
The implication is clear. The trajectory you commit to in the first eighteen months is, for most ventures, the trajectory you are stuck with. Founders who recognise this commit deliberately. Founders who do not, drift into one of the three by default and pay the cost when they discover they are on it.
How to choose the right trajectory deliberately
The choice between the three trajectories is not abstract. It is a function of the venture’s category, the founder’s strengths, the operating environment, and the long-term outcome the founder is building toward.
The upward trajectory is the right choice when the venture’s category supports premium positioning, when the founder has the operational discipline to deliver consistent quality at premium levels, and when the founder is building toward a long-horizon outcome that depends on pricing power. African professional services, hospitality at the upper end, and software products with genuine differentiation are categories where the upward trajectory typically works.
The flat trajectory is the right choice when the venture’s category is mature, when competition is broadly comparable in quality, and when the founder is building toward a venture that competes on operational efficiency, customer relationship depth, or distribution rather than on pricing leverage. Many service businesses and some product categories sit naturally in this trajectory.
The downward trajectory is the right choice when the category has strong volume dynamics, when scale economies are significant, when the founder has the capital to fund the volume-acquisition phase, and when the long-term outcome is market dominance through cost leadership. This trajectory is rare in early-stage African ventures because it is capital-intensive and the African capital ecosystem is thin enough that few ventures can sustain it.
The honest assessment, in my experience, is that most African early-stage ventures should be on the upward trajectory by default, because the category headroom in African markets is wide, the operational discipline required is achievable, and the dilutive cost of pursuing the volume trajectory is too high in most cases. Founders who default to the flat trajectory, treating their pricing as a moderate compromise, often end up in the stuck middle position I have written about elsewhere, which is structurally weaker than either of the deliberate alternatives.
The first eighteen months as the trajectory’s foundation
The trajectory is set in the first eighteen months of pricing decisions. Each decision in this period either reinforces a trajectory or starts to undermine one.
A founder who has chosen the upward trajectory protects it by holding prices firm in the early months even when customers push back, by refusing to discount even when revenue would be welcome, and by investing the early revenue into the quality improvements that justify continued price increases. The trajectory compounds because the founder is making the decisions that compound it.
A founder who has chosen the upward trajectory but discounts under pressure undermines it from the start. Each discount sets a precedent. Each customer acquired below the stated price adds to a customer base that expects discounted treatment. The founder is sliding toward the flat trajectory while telling themselves they are still on the upward one, and by month eighteen the slide is structural.
The discipline is to recognise that every pricing decision in the first eighteen months is a trajectory-shaping decision, and to make each one consistently with the trajectory the venture has chosen. This is harder than it sounds, because pressure to discount, to match competitor pricing, or to accept any revenue is constant in the early period. The founder who holds the line through this period emerges at month eighteen with a venture clearly on a chosen trajectory. The founder who yields emerges with a venture on a trajectory they did not choose and now cannot easily change.
The closing observation
Pricing is one of the few decisions a founder makes that compounds across the entire life of the venture. Most other early decisions can be revised; pricing decisions become entrenched in customer relationships, brand position, and unit economics in ways that are uniquely persistent.
This is why pricing deserves trajectorial thinking from the start. The founders who treat pricing as tactical end up with venture structures they did not choose. The founders who treat pricing as a multi-year trajectory end up with ventures whose pricing position is part of the strategic moat. The trajectorial thinking takes more effort up front. The compounding return across years is one of the largest available in venture-building.
If you are a founder approaching the first pricing decision, or a founder reviewing your current pricing position, the most useful question to sit with is: what trajectory am I currently on, and is it the trajectory I would deliberately choose. If the answer is yes, the work is to defend it through the inevitable pressure to deviate. If the answer is no, the work is to begin the difficult transition before the trajectory becomes structurally entrenched.
The pricing decisions you make this year are the trajectory you are committing to for the next five. Choose deliberately. The compounding cost of choosing by default is one of the largest costs founders bear, and one of the easiest to avoid.
For the structural failure of drifting into a position no segment will pay for, see The Stuck Middle. For the related discipline of pricing in dollars rather than local currency, see The Dollar Discipline. For why “your prices are too high” is rarely actually a price problem, see When Customers Say Your Prices Are Too High.
