“I priced based on things that I knew and based on my thinking of the value of weather up and my costs in servicing weather up not on the customer perceived value of weather up and I think that's a huge thing that Founders can get themselves tied up in knots about.”

Price to Perceived Value, Not Your Costs — Customers Don't Care What You Pay for API Data

David knew his weather-data API costs were high and set pricing to guarantee margin — a classic cost-plus mistake. Meanwhile, his target audience (weather nerds) already owned several weather app subscriptions, knew market prices, and immediately benchmarked Weather Up against Carrot Weather at $30/year. Value-based pricing is calibrated to what the customer believes it is worth, and for commodity categories, that means knowing competitor pricing cold.