“I pay $5,000 a month for the X API which not many people are willing to spend that much for that data... all in all together I think I pay about $250 a month... on $25,000 a month of revenue I think that puts it right around 80% margins.”

Create a data moat by paying costs your competitors refuse to absorb

By paying the $5K/month X API cost that competitors refuse to absorb, Alex created a genuine data moat that justifies a premium price point and keeps margins at 80%. The willingness to take on a cost others avoid becomes both a defensibility argument to customers and a natural pricing floor. Users aren't just paying for features — they're paying for access to a data pipeline that would cost them far more to replicate.