Trends in AI Monetization

I thought there’d be a consensus on how to monetize AI by now. I was (mostly) wrong. With your help, I've spent the past three months investigating what's actually happening in SaaS & AI monetization -- not just what's making headlines. And I've collected data from more than 240 software companies. I'm so excited to finally release the findings. See for yourself here: https://lnkd.in/ePsQJT6X Six takeaways from the new Tremont | Growth Unhinged State of B2B Monetization report: 1. Seats & flat-rate pricing are increasingly under threat. The rise of AI, and AI agents in particular, means value gets decoupled from customers needing to buy more seats. And the costs of delivering AI means software companies need a mechanism to protect themselves if & when AI usage spikes. 2. As AI continues to gain traction, hybrid has become the ‘it’ pricing model. Seats and flat-rate pricing are being replaced by hybrid pricing, i.e. combinations of subscriptions and usage. Hybrid pricing is up from 27% to 41% adoption (!) in the last 12 months. Software and AI are becoming inseparable. More than half of survey respondents said they include AI capabilities as part of their core software product offering. 3. There are a seemingly infinite number of ways to structure hybrid pricing. Choose wisely (or support multiple models). Software founders used to tell me their pricing was inspired by Salesforce or maybe Slack. Now they tell me they were inspired by Clay. Clay's hybrid model has multiple routes to expand customers while keeping pricing (relatively) simple: more features (subscription packages) and more usage (credits). 4. Outcome-based pricing is seen as the 'holy grail'. It's still out of reach for 95% of the market. A mere 5% said their pricing model is outcome-based right now. But 25% said they expect to have outcome-based pricing by 2028. 5. The shift toward pricing transparency seemed inevitable. This isn’t playing out. My two cents: many software companies, especially early-stage and AI companies, don't have pricing totally figured out. And as soon as they publish pricing, it gets way harder to adjust. 6. Pricing models keep evolving. Most of the market is unprepared to keep up. Be careful to avoid pricing ‘no-man’s land’ -- this happens between $5-20M ARR when ownership often falls through the cracks. --- Hope you enjoy the report. THANK YOU for your support 🙏 - Kyle PS, the full report is available at the link above. No need to comment “pricing” for it, but you’re welcome to if you want 😭 #pricing #ai #monetization

Happy New Year! 2025 will be a fascinating year for B2B SaaS Pricing. AI innovations continue accelerating, and (AI) monetization has become an increasingly urgent topic amongst C-suite, boardrooms, and investors. Here are my top five pricing trends and predictions for 2025. 1️⃣ How we price AI will increasingly be determined by its "modality." 💬 - AI services will proliferate and take many forms, and there is no "one size fits all" approach to AI monetization. Pricing new AI services will come down to both "what" and "how"—what value is it delivering, and how is the value being delivered? The "What" will drive the value metrics and the price we expect customers to pay. However, the "How" - How AI services will interface with the end user and to whom value is delivered will determine how AI will be charged in the long run. 2️⃣ Usage-based Pricing (UBP) will become mainstream...📈 - UBP was a curious concept for most SW companies a few years ago, but it is seen today as the way SW will be priced in the future. AI will fundamentally alter what value SW can deliver to customers; these values will become increasingly "self-evident" over time, allowing firms to price to discrete units of "work" or "outcome" instead of pricing for access. This trend is well on the way, and we will look back at 2025 as the year when UBP becomes mainstream. 3️⃣ ...but we will continue to (mostly) pay in a very "subscription" like way 🔄 - Pricing to a unit of "work" or "outcome" doesn't mean we will pay for these services that way. Buyers and sellers will continue to want predictability and simplicity. While we will see more "pay as you go" models being adopted to lower the barrier to entry and incentivize adoption, the bulk of UBP transactions will come from some form of recurring usage commitment, and they will look very "subscription-like." 4️⃣ "Credits" will be everywhere 💰 - We will see more companies adopt some form of "credit" system for pricing. There are two reasons for this: 1) Complex AI systems will have many cost and value axes that may need to be monetized separately, and pricing them individually will be too complex for customers; 2) The rapid pace of AI innovation meant that company needs a way to adjust both the price and the pricing metric frequently - multiple times in the same year or more, and they need to do this w/o massive disruption to customers. An abstraction model like a credit system can reduce complexity and procurement friction while allowing companies to maintain business flexibility. 5️⃣ We will still be talking about "Outcome-based pricing" in 2026 🌈 - Outcome-based pricing made a big splash in 2024, but if we dig a little deeper, what most are calling "outcome" is pricing to some unit of output, or in some cases, total system utilization. As AI becomes more sophisticated, we will likely see the definition of "outcome" evolve and come closer to how the customer defines "success." #AI #Pricing #SaaS

As Q1 earnings roll in, one theme is becoming clear: data is the next frontier for monetization — and AI is the key to unlocking its value. 📊 In AI-Media Technologies Ltd (ASX:AIM)’s latest earnings call, we saw this trend in action: ✔ European Expansion – Revenue grew 36%, with operations in 12 new countries. ✔ AI-Powered SaaS Growth – Lexi saw a 48% volume increase and 45% sales growth. ✔ High-Tech Margins – SaaS gross margin hit 86%, signaling strong profitability. ✔ Lexi Brew’s Strategic Role – CEO Tony Abrahams highlights how Lexi Brew digitizes archives and automates metadata tagging, making internal knowledge more accessible and monetizable in law & finance. 🔍 The Underreported Innovation: Lexi Brew A collaboration between BrewAI and AI-Media (ASX:AIM), Lexi Brew is redefining how enterprises unlock value from their data. Lexi Brew is a secure AI knowledge assistant that: 🔹 Digitizes archives & internal data to make proprietary knowledge searchable & monetizable. 🔹 Automates metadata tagging, transforming data into a strategic asset. 🔹 Operates behind firewalls, ensuring privacy & compliance in law, finance, and regulated industries. 🌍 AI & Data Macro Trends in 2025: The Big Picture 1️⃣ AI-Driven Compliance & Accessibility → 📢 80% of European broadcasters now adopting AI solutions under new EAA regulations. (Source: https://lnkd.in/e7M2qZDi) 2️⃣ AI Monetization in Private Markets → 📊 Family Offices & hedge funds are using AI-powered research tools to gain an edge. (Source: https://lnkd.in/ePyeSfph) 3️⃣ Data-as-an-Asset (DaaS) → 💾 The shift toward knowledge management AI is fueling demand for enterprise AI integrations. (Source: https://lnkd.in/ezyFZETD) 💬 What’s Your Take? ➡️ Is AI helping or hurting enterprise knowledge-sharing? ➡️ Are we entering the age of “AI-powered compliance” in finance and legal industries? 🔗 Source: https://lnkd.in/ea_7yaQr #Q1Earnings #2025 #AI #Finance #EnterpriseTech #DataMonetization #LexiBrew #SaaS #Investing #Economy