One of Sarah Tavel’s most actionable frameworks for evaluating startups is deceptively simple: Build a 10x better product AND make it cheaper than the incumbent.
The “AND” is everything.
The Core Thesis
Tavel observed that the biggest breakout companies don’t just improve on one dimension—they dominate on both experience AND price:
- Uber: 10x better than taxis (tap a button, see the car coming, no cash fumbling) + competitive/cheaper pricing
- Airbnb: Unique accommodations you can’t get elsewhere + cheaper than hotels
- Netflix: More selection and convenience than Blockbuster + no late fees
- Amazon: Endless selection and convenience + best prices
- WhatsApp: Better messaging experience + free (vs SMS costs)
Why Both Matter
“Lead with the 10x. Saving money is pouring gas on the fire.”
The 10x product is what creates the initial desire and keeps people as customers. If your only value prop is “we’re cheaper,” you’re in a race to the bottom. Someone will always undercut you.
But when you combine a genuinely superior experience with cost savings, you create an unstoppable force. The 10x hooks them, the savings remove all friction to adoption.
As Tavel’s former Pinterest colleague David Rubin noted: “Your service shouldn’t lead with ‘saving money’. You must create an offering so compelling it stands by itself in the consumer’s mind.”
Tavel’s Law
“For every step of friction you reduce, the market grows 10X.”
This explains why mobile unlocked so much value. Uber couldn’t exist without smartphones. The friction reduction of “always in your pocket” expanded the addressable market dramatically.
The Implication for Founders
If you’re building something that’s only marginally better, or only cheaper, you’re likely building a feature, not a company. The enduring businesses nail both.
Questions to stress-test your startup:
- Is your product genuinely 10x better on the core use case?
- Are you saving customers money (or time, which is money)?
- What friction can you eliminate to expand the market?
What examples have you seen of companies that nail this framework? And what about counterexamples—successful companies that broke the rule?
Interesting framework, but I wonder how well it translates to B2B SaaS.
In consumer, “cheaper” is straightforward—users pay directly. But in B2B:
The “cheaper” calculation is more complex:
- Total Cost of Ownership (implementation, training, migration)
- Time savings for employees (often the bigger ROI)
- Opportunity cost of not having the tool
- Risk reduction (compliance, security)
Examples that fit the framework:
- Slack: 10x better than email for team communication + reduced meeting overhead (time = money)
- Figma: 10x better collaboration than Sketch + no per-seat licensing for viewers
- Notion: 10x consolidation of tools + cheaper than buying wiki + docs + project management separately
Counterexample - Salesforce:
Salesforce is neither 10x better than alternatives nor cheaper. It’s actually more expensive and clunkier than many competitors. Yet it dominates. Why? Ecosystem lock-in, enterprise sales motion, and “no one gets fired for buying Salesforce.”
Maybe in B2B, the framework needs a modifier: “10x better AND cheaper… OR 10x better at de-risking the purchase decision.”
Thoughts?
This framework was literally our north star when building our vertical marketplace for freelance designers.
How we applied it:
The 10x Experience
- For clients: Browse curated portfolios, see real pricing upfront, book directly (vs. posting on Upwork and getting 50 irrelevant proposals)
- For designers: Get matched to relevant projects, no bidding wars, fair rates
The Cost Savings
- For clients: 15-20% cheaper than agencies for equivalent quality
- For designers: Keep 90% vs. 80% on other platforms (we take less because we’re more efficient)
The key insight: We could offer BOTH because we’re more efficient than incumbents. Agencies have account managers, offices, overhead. Upwork has massive support costs from low-quality matches. Our curation and matching reduced waste for everyone.
Tavel’s Law in action: We reduced friction by letting designers set their own rates and availability. Clients book in 2 clicks vs. a 2-week RFP process. Our market grew because we captured demand that never would have hired an agency.
The framework works. But I’ll add: you need to be 10x better on the dimension that matters most, not every dimension. We’re not 10x better on “I need an agency to own my entire brand.” And that’s okay.
Great discussion! I want to push back on whether “cheaper” is always necessary. There are successful products that are 10x better AND more expensive:
Premium counterexamples:
- Apple: iPhones are 10x better integrated ecosystem, but definitely not cheaper
- Tesla: 10x better driving experience, started at luxury price points
- Peloton: 10x better home fitness experience, premium pricing
- Superhuman: 10x faster email, $30/month vs free Gmail
These companies prove you can charge MORE if the 10x is strong enough. The key seems to be:
- Target users who value time over money (professionals, affluent consumers)
- Make the premium feel justified by the experience gap
- Create status/identity value beyond pure utility
My synthesis: Tavel’s framework might be more precisely stated as:
“10x better AND remove the primary barrier to adoption”
For mass consumer markets, that barrier is usually price. But for prosumer/premium segments, the barrier might be complexity, time, or social proof.
The danger is founders using this as an excuse to charge premium without delivering 10x. “We’re like Superhuman for X” has become a red flag for “we’re charging $30/month for a mediocre product.”
How do others think about the premium positioning exception?