Three years ago, Fivetran moved from a connector-based model in which customers paid a fixed price per connector to a usage-based pricing model where customers pay for usage.
We aren’t the first to use a usage-based model, either! Many companies in the data industry are consumption-based, like Snowflake, AWS and mongoDB to name a few. The decision to embrace a usage-based model, for us and other organizations, centers around driving value for our customers and complementing product-led growth.
In this article, we’ll cover the many benefits for our customers and how this shift has impacted Fivetran. Whether you’re a current customer or evaluating Fivetran, we hope this article helps you understand why Fivetran's pricing benefits your business. Alternatively, if you’re a growth-stage company evaluating different pricing models, we hope this article illuminates the benefits of a usage-based pricing model for product-led growth.
How does Fivetran measure usage?
A major difference between Fivetran’s pricing model and those of other ELT solutions is that we charge for Monthly Active Rows (MAR) because MAR are a better measure of value than total synced rows.
A monthly active row is a row that’s been added, updated or deleted by our connectors from your sources to your destination. A single MAR is only counted once per month, no matter how many times it’s been updated. Typically, total rows are 5-50x more than MAR each month. Since the bulk of total rows don’t change day-to-day or week-to-week, charging for total rows wouldn’t align well to incremental value for our customers. Fivetran has designed our connectors to minimize your warehousing compute bill and update waste —and our pricing model is designed to only charge for changed data.
Why usage-based pricing is great for our customers
You only pay for what you use - it’s direct price to value
Other common types of pricing models charge per user, per service or a flat rate. But under these scenarios, cost ties loosely to value. A customer using very little and a customer using a ton may pay the same.
Conversely with a usage-based pricing model like Fivetran’s, your cost is tied directly to your usage and benefit. “As a manufacturing company, everything we do is about cost and margin. The consumption-based model is easier to wrap your head around because your usage and benefit are driving the cost. Consumption effectively scales with whatever pace you are scaling, so you aren’t paying ahead of where you’re at,” shares Ajay Bidani, Digital Enablement and Insights Manager at Powell Industries.
Paying for usage is cheaper (and faster) than building yourself
Considering the number of data sources most companies have, the costs of building pipelines on your own quickly adds up. Wakefield Research’s survey of hundreds of data analytics and business leaders shares that it typically costs around $520,000 a year for a team of data engineers.
But using a fully-managed solution is a fraction of the cost required to build pipelines for every source. With Fivetran, as your volumes increase, your unit costs automatically decrease, so the cost of connecting additional sources becomes increasingly cost-efficient.
Start small, and grow when you’re ready
Many growth companies have low volumes, strict budgets or are still proving the value of a modern data stack to their stakeholders. Likewise, many enterprise customers need a low-risk way to “dip their toes” into a new solution before committing long-term.
The beauty of usage-based pricing is that you can use as little as you want for any source. After running a free trial, many start on our new free plan, or enter a credit card and start small with just a few sources, then scale at their own pace. This lowers the barrier-to-entry for smaller companies and enables larger enterprises to create a solid proof of concept with a few sources before making a larger commitment.
“Being able to spend a couple of months using a credit card while we figured out our long term usage was very helpful. From there, we were able to easily move on to an enterprise plan. It felt very low-risk to keep adding connectors and progressing.”
- Irving Popovetsky, Head of Customer Engineering at Honeycomb
“Fivetran is helping us feed data into our first data warehouse. It's one of the first steps in introducing a modern data stack to our small nonprofit that ran completely off of spreadsheets less than 6 months ago.”
- Samantha LeBlanc, Code2College
It’s easy to be flexible with the needs of your business
With usage-based pricing, you are able to scale up or down your usage based on your need. This is especially valuable for our eCommerce customers, like Polly or Saks Fifth Avenue, whose data volumes often change seasonally.
You can also add or remove connectors at any time — so if your company changes vendors, it’s easy to pause connectors and add new ones. Similarly, Fivetran enables you to turn off any tables that don’t drive value for your business, helping you manage your costs.
How much will it cost my organization?
There’s a great way to figure out exactly how Fivetran will cost — just test it out yourself! Sign-up for a 14-day free trial and once you’re a customer, you can try any new source completely free for 14 days.
In line with our commitment to accessibility and providing value first and foremost, we also recently unveiled our Fivetran Free Plan. With unlimited users and up to 500,000 MAR at no cost — you can enjoy the benefits of our Standard tier today, including access to 300+ fully-managed application and database connectors, 15-minute syncs, and more.