$865 million Mixpanel is slashing prices for startups and nonprofits because data analytics is a 'necessary component, not a luxury' for modern business
- On Wednesday, data analytics company Mixpanel announced it make a drastic cut on its enterprise software prices for startups and nonprofits.
- Early-stage startups and nonprofits on a limited budget may not be able to pay for data analytics software, so with the discount, Mixpanel hopes to reach these customers and help them be more successful.
- Mixpanel sees this as a long-term investment because if these smaller firms become successful, they can eventually grow into big-spending customers.
When data analytics company Mixpanel started nine years ago, it faced many of the struggles startups often face: how to use its resources, what tools to buy, who to hire - and to solve all of those problems on a limited budget.
Now, Mixpanel wants to pay it forward to startups and nonprofits today. On Wednesday, it announced it would slash its software prices by 90 percent for startups. And for nonprofits, they'll receive 10,000 free users per month, and a 80 percent discount for additional users.
"We went through quite a bit of growing pains and the struggles startups face when they're taking big risks," Amir Movafaghi, CEO of Mixpanel, told Business Insider. "We know important it is to get every single resource along the way and help you accomplish your goals."
The motivation comes from Mixpanel's own story of growth. Founder and former CEO Suhail Doshi was only 20 years old when the company was formed in 2009, but Mixpanel has since scaled to 300 employees across offices in U.S., London and Singapore. Mixpanel is now valued at some $865 million.
"We don't want price to be a hindrance," Movafaghi said. "We're at a point in the company's life where we can afford to be part of an investment and be part of startup's success stories. We don't want affordability to be a constraint."
Mixpanel's platform helps customers use data to make product and marketing decisions for their companies. For instance, using Mixpanel, companies can scientifically test how popular a new website or app feature is, versus the old one.
As for nonprofits, they can use analytics to learn more about donor behavior and figure out how they can make the most impact.
"The company has been on a journey to level the playing field," Movafaghi said. "All the companies can have access to the data analysis. User analytics and help companies understand their user behaviors and help leverage that knowledge to build great products and experience."
From zero to hero
Customers like DocuSign and Mint had used Mixpanel in their early days. Since then, DocuSign went public earlier this year, and Mint was acquired by Intuit for $170 million.
These kinds of discounts also benefit Mixpanel in the long run, says Movafaghi. Although in the short term they might lose out from these slashed prices, Mixpanel is willing to make that investment because if the startup becomes successful, it's now a large-scale customer that can afford to shell out at full price for even more users. The discount is a gateway for startups to invest in analytics software over the long-term, says Movafaghi.
"Effectively if these companies grow and become successful, their pricing structure can evolve," Movafaghi said. "It will no longer be a startup customer, it will be a successful scaled customer."
Originally, Mixpanel had a free version with limited capabilities. However, they got feedback from customers who wanted more advanced capabilities but didn't have the budget to pay for the full range of Mixpanel's software.
"Based on all of what we've heard from startups over the years, we ultimately wanted to have a dedicated plan that scaled with them," Movafaghi said.
In today's landscape, Movafaghi calls data analytics a "necessary component, not a luxury." When startups are on a budget, they may not prioritize paying for data analytics software, but he hopes that this discount frees up some resources.
"It's the same struggle that almost all startups go through in terms of being mindful of how they deploy their resources. Every dollar counts," Movafaghi said. "They can leverage Mixpanel for a lot of data infrastructure and analysis and dedicate resources to building products that will be successful."
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