Before COVID-19, many companies attempted various stages of ambitious digital transformation programs. In the last year, we were thrust into this new world and it taught us that digital adoption is the only way forward.
Priorities have shifted and tech leaders realised that cloud-based SaaS solutions are critical in innovation and agility, giving them the flexibility to change with the times and be ready for any threat that may come at them. Companies that already had a flexible pricing solution in place were far better at adapting their strategy quickly and survive. Out of the more than 30 customers signed last year, a good amount either accelerated their projects or decided to move ahead from zero because of the need to rapidly adjust and control pricing in response to the pandemic.
With a proven track record of growing startups in Europe, Marcin Cichon, the CEO and co-founder of Pricefx, knew the pricing industry needed a transformation to match the evolving needs of businesses. Based on his decades of experience in the software business, Marcin made the move to fundamentally shift the business relationship with pricing technologies. He changed the cloud-based pricing software market when the industry’s on-premise alternatives bogged down customers with years-long implementation timelines tied with multi-million dollar price tags. Even during the difficulties in 2020, Pricefx grew its year-over-year subscription revenue by 44%, and, with Marcin’s leadership, raised $65M series C, with a total of $130M raised in total.
What has been the traditional company response to financial technology innovations nationally?
2020 was the year that we saw technology innovations come to life, especially when they were initially put on the backburner. Because of the shock of the pandemic’s unpredictability, everyone has been living with the mantra that the one thing we should be certain of is uncertainty. Pricefx was built on this mindset from its inception in 2013. The market has shown us how volatile it can perform. In response, technology innovations and digital transformation initiatives are front and centre.
Pricefx has always held its premise that no matter the market condition, it is fast, flexible and can move with the times. Some of the largest organisations and industries – nationally and worldwide – have shown us that they’re more transparent, giving market leaders an open path to multi-channel approaches to their goods available at any time. Marketplaces, API-based integrations with third-party websites are giving companies the chance to drive traffic and better compete with the competition. Pricing solutions equipped with price optimisation and AI functionality allow these companies to capitalise on reaching customers directly with the right offers at the right time.
How has this changed over the past few years?
Prior to 2020, there were many market changes that caused a volatile increase in a number of factors, from cost shifts, supply chain disruptions, and variations in demand, which uncovered the need for dynamic pricing.
Businesses needed to respond rapidly to changes in prices to ensure their competitive stead in the market. Algorithmic optimisation is critical in setting up pricing guidelines and Pricefx allows customers to test any modifications to pricing strategies, no matter how large or small, before going live into market. Pricefx doubled down on AI in pricing when we acquired Brennus Analytics in 2020 to further our expertise and deepen our bench of talent. It was a strategic move to allow us to continue to keep going with the fast-moving business climate of today.
Is there anything that has created a culture of change inside the company?
The stuffy corporate culture was never what we subscribed to at Pricefx. That means we had a work remote workforce before it pushed companies everywhere to that model during the pandemic and we also work alongside our values, which just so happened to be f-words. We’re a fast, flexible and friendly cloud solution that has been serving the needs of our customers and partners from day one. Pricefx’s model – pricing in the cloud – shifted the industry to prepare it for the needs of an environment like we are in today, and for the future.
What fintech ideas have been implemented?
We’re implementing a strategic project this year to single-source all data within the company, in order to create a universal data lake for our business management purposes. We are also continuing to use our own products to configure orders, quote pricing to customers, and evaluate our own customer data. We figure we sell these capabilities to our customers, we should use them too.
What benefits have these brought?
We see the same areas for improvement our customers see, and we get some of the same benefits, streamlined processes, and flexible adaptation from situation to situation. Of course our ROI is a bit shifted, since our cost of development is significantly more than a customer would pay.
Do you see any other industry challenges on the horizon?
There are several big changes facing the B2B world and SaaS software as well. B2B in general is going to continue to see the adoption of digital B2C buying behaviours become requirements. Executives like to order things with one click from their phones at home, they want the same ease and confidence at work so B2C digital buying experiences will continue to shape the B2B world, and will require a much faster and more responsive approach to pricing than B2B enterprise is typically used to.
SaaS for B2B needs to continually look at how we can remove friction and speed time to value – the entire expectation of SaaS for B2B will continue to be around simple, instant access and utility, and instant value creation. Not all SaaS B2B providers are aiming there, but we believe this will be the future we need to build for today.
Can these challenges be aided by fintech?
Yes, fintech can help. In our case, we’re working on making our products accessible through self-service sign-up and self-service data loading and integration capabilities. And we’re continuing to look at how to integrate workflows, payments gateways and contract negotiation and settlement tools along these lines. We recently launched Velo, which is the industry’s first large deal negotiation tools set, enabling Value Estimation within the CPQ, and integrated to deal planning workflows in line with analytics and CPQ approvals.
As business leaders absorb the lasting implications from 2020, we believe capabilities for price management and optimisation will become even more central to top executives looking at how to recover quickly and build back better.