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by rjb 5757 days ago
Dharmesh Shah touched on this at Startup Bootcamp last year and expands on what petervandijck discusses. Effectively, there is a financial benefit (based on longevity) and financial cost (acquisition) to pricing, and the goal is to make the two overlap as little as possible. I highly recommend watching his talk:

http://onstartups.com/tabid/3339/bid/11042/Dharmesh-On-Start...