Ghost.org, the markdown blogging non-profit, released a blog post covering its five-year journey to $82,000 in monthly recurring revenue and a customer list that includes Apple, Mozilla, and Cloudflare.
The post itself is great, especially if you’re interested in open-source software, but the most insightful bit wasn’t in the post itself. John O’Nolan (of Ghost) did a sort of AMA on Indie Hackers, after writing the article.
The Ghost Foundation is a non-profit that works on the open-source technology Ghost. They make their money through a paid solution called Ghost(Pro), where they host and manage blogs written in Ghost.
A commenter noted that he saw complaints all over the internet about Ghost(Pro)’s high price, and asked why the price was higher than people would expect (~20 dollars rather than ~10).
John responded with a detailed answer that I recommend you read in full. The gist is that they price their product very deliberately. Their goal is to have ~4000 customers, and they just charge the amount of money necessary to keep the number of customers constant. If demand increased sharply, they would increase their prices until they got about 4000 customers again. If demand fell, and the number of customers fell below 4000, they would decrease their prices.
That blew me away. Yes, of course, if you increase your prices you will get fewer customers, and if you decrease your prices you will get more customers (depending on elastic vs inelastic demand, and all that).
I never considered that a business model would center around keeping the number of customers constant. You suddenly look at customer acquisition and pricing differently.
His method wouldn’t make much sense for an app that scales well, but when your business model is hosting websites it makes sense to be extremely conscious of how many websites you’re hosting.
I’m tempted to say that it’s unusual that a non-profit would come up with such an interesting approach to pricing, but maybe it’s not strange. Maybe when you’re a little distanced from the profits you’re also more likely to innovate. Regardless, John’s thoughtfulness will serve the Ghost Foundation well in the future, and I look forward to his next blog post.
Originally published at https://www.zakmiller.com on May 17, 2018.