COUNTER
Raising prices 10-20% at year 2 multiplies EBITDA by 5x by year 5
Harvard research on the compounding cost of discounting.
The PUBlish Desk · 15 April 2026
A Harvard Business Review 2020 analysis of 4,700 mid-market B2B companies tracked outcomes from year-two pricing decisions. Companies that raised prices 10-20% at year 2 had 5.1x higher EBITDA at year 5 than companies that cut prices by the same range.
The reason is not margin — it's customer selection. Price hikes drive out price-sensitive customers early, when replacing them is cheapest. The remaining customers self-select as higher-value, lower-churn, and more referral-productive.
Discount early and you build a long revenue tail you have to defend forever.
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