A Hundred Dollars a Month Isn't Traction

A Hundred Dollars a Month Isn’t Traction

It might be your customers being polite.

I had a call with a founder this morning. Smart guy, deep domain expertise. Real problem. Paying customers, but when we dug into the unit economics, something felt off.

They’re doing transactions worth hundreds of thousands of dollars. Their current take rate? A hundred bucks a month.

Happy Ears

It sounds like traction, but it might be noise masquerading as product-market fit. I call it happy ears. The founders hear “yes, I’ll pay” and think they have it. But there’s a big difference between someone paying $100 to kick the tires and someone paying because they can’t afford not to.

It’s not just affordability, it’s alignment with value creation.

Real traction tends to be proportional to the value you create. If you’re moving a $300K transaction and capturing $100, I don’t know if people love your product or just don’t care enough to cancel.

Revenue as a Signal

Revenue proportional to value creation is a key signal. The friction of someone paying real money tells you that you’re solving a genuinely important problem. When revenue and value creation are disconnected, you’ll scale slowly, or not at all.

Startups don’t die of starvation. They die of indigestion, chasing small opportunities that turn out to be empty calories. Validate the core value and the unit economics first. Then scale.

The 10x Test

If you’re B2B, here’s my test: if you’re creating 100x the value you charge, would your best customer pay 10x what they pay today if you asked them to?

If you hesitate to even ask them, you already know what you need to do.