# AfterHours · Pricing Rationale (Internal) This is a buyer/operator document. It is not for prospects. It explains why we charge what we charge, when to discount, when to walk away, and the LTV math the price was set against. --- ## Standard price: $497 / month One location, one vertical playbook, unlimited overnight inbound (web form, missed-call text-back, email forwarding). Annual prepay knocks 15% off ($422.45/mo equivalent, $5,069 prepaid). ### Why $497 specifically Three anchors set the price: 1. **Human answering services are $1,200 to $2,000 per month** for the equivalent inbound volume, and they do not qualify or book. We need to feel obviously cheaper than the human alternative without looking like a low-touch chatbot. Half the price is the right gravitational pull. 2. **One captured job pays for the month.** Across our three verticals, average job value is $400 (clinics) to $4,000 (law-firm retainers). At $497, even a clinic owner only needs to win 1.25 extra visits per month. Plumbers and law firms close the math on the first incremental job. 3. **The price sits below the SMB approval threshold.** Owner-operators making sub-$5M revenue have an unwritten "I do not need to think about it" ceiling around $500/month. We deliberately landed under it. Anything in the $500 to $1,000 band requires real procurement attention; under $500 is on the founder's discretion. --- ## When to discount Three legitimate cases. Anything else is the prospect testing whether we are confident. ### Annual prepay: 15% off $5,069 prepaid, equivalent to $422/mo. We take this trade because cash up front kills churn risk on month-three (the most common churn point) and our gross margin survives the discount. ### Multi-location: per-location stacking 2 locations: $897/mo (10% off second). 3 locations: $1,247/mo (16% off third). Cap at $399/mo per incremental location. The marginal cost to us is mostly the playbook tuning per region (service area boundaries, pricing ranges); voice/text inference scales nearly free. ### Design partner (new vertical only): 50% off for 6 months Only when we are entering a vertical we have not productized for, and we need recorded transcripts plus a case study with metrics. Hard cap: one design partner per vertical. After 6 months, the price reverts to standard or they walk. We get a case study, they get a price they can never get again. --- ## When to walk We do not negotiate below $300/mo on standard plan. Hard floor. The reasons: - **Below $300, the support cost eats the margin.** Even fully-AI accounts generate ~3 to 5 hours/month of human handoff, escalation review, and tuning. At $300 we are still profitable; at $250 we are paying to acquire a customer who will churn at month three. - **Anyone trying to negotiate below $300 is not the customer.** They will be the loudest in support, will demand the most edge-case handling, and will churn first. The discount discussion is a leading indicator. - **The owner who fights $497 cannot afford the next product we want to sell them.** Receivables follow-up, review-request automation, and seasonal upsell pricing are all $200-500/mo add-ons. If they fight the entry price, they will not become an LTV customer. Polite walk-away script: "I understand. Our price is set so that one captured job per month covers it. If the math does not feel right at $497, this might not be the right fit yet. I will follow up in 90 days when your inbound volume justifies it." Do not chase. The pipeline is the pipeline. --- ## LTV math Pricing only makes sense if it survives the cohort math. ### Assumptions (refresh quarterly) - Standard ARPU: $497/mo = $5,964/yr. - Annual prepay penetration: 28% of new customers (TBD: confirm via cohort tracker). - Blended ARPU after annual mix: ~$5,790/yr. - Gross margin: ~78% (LLM inference + voice gateway + handoff hours). - Monthly churn: ~3.5% (target). Plumbers churn slightly higher (4.2%); law firms lower (~2.1%); clinics in the middle. (TBD: confirm via Stripe export.) - Average customer lifetime at 3.5% monthly churn: 28.5 months. ### LTV $5,790 ARPU × 0.78 GM × (28.5 / 12) years = **~$10,720 LTV** per customer at standard. ### CAC ceiling To stay healthy at 3:1 LTV:CAC, we can spend up to ~$3,500 to acquire a standard customer. We will not approach that, but the room is there for paid + outbound + a referral kicker. ### Payback period At $5,790 ARPU and 78% margin, gross profit per customer-year is $4,516. Payback against a $3,500 CAC is roughly 9.3 months. That is acceptable but not great. The lever to compress payback is the annual prepay (immediate cash) and the multi-location upsell (which roughly 40% of plumbers and 22% of law firms convert to within 6 months). --- ## Comparable services (for the prospect conversation) | Service | Monthly | What you get | What is missing | |---|---|---|---| | Ruby Receptionists | ~$385 to $1,650 | Human pickup, basic message-taking | No qualification scripts, no booking, no morning brief | | AnswerConnect | ~$229 to $799 | Human pickup, light scheduling | Slow on web/text, no vertical playbook | | AnswerForce | ~$1,200 baseline | Trades-focused human dispatch | $1,200 floor, monthly minute caps | | Smith.ai | ~$285 to $1,455 | Human + light AI, basic intake | Per-call billing inflates fast on volume | | AfterHours | $497 flat | Sub-60s reply, qualification, booking, 7am brief | (Standard) one location, one vertical | The cleanest comparison is the value not the price: every alternative still requires you to read a pile of messages in the morning and do the booking yourself. AfterHours hands you one email and a calendar that is already filled in. --- ## Prices we will revisit - **Q4 2026:** raise standard to $597 once the second-vertical playbook (clinics) has 25 paying customers and a case study with conversion metrics. - **2027:** introduce a "Brief Pro" $897/mo tier with multi-language, after-hours phone callouts (not just text), and live-translation handoff for clinics. - **Never:** a free tier. Free trials are 14 days, no credit card. After day 14, the lead pipeline either justifies the price or it does not.