A startup may grow rapidly up to a certain point, but then growth starts to slow down or stops altogether. In such a situation, many founders see spending more money on marketing as the first solution.
However, Jason Cohen — founder of four companies, including WP Engine, and an investor in more than 60 startups — points out that there may be another reason behind this.
In an episode of Lenny’s Podcast, he outlined five questions founders should ask first when product growth stalls. Below, we look at the first two steps.
1. Are customers leaving your product?
The first question is simple: Why are customers leaving?
A customer spends considerable time and money discovering a product, visiting the website, checking the price, making a payment, and going through onboarding. If they then stop using the product, the problem may not be marketing — it may be the product itself.
The key metric here is logo churn, which is the percentage of customers who leave the product during a given period.
How does churn affect growth?
Imagine a company acquires 100 new customers every month and 5% of its customers leave each month.
The theoretical maximum number of customers would be:
100 ÷ 0.05 = 2,000 customers.
In other words, if the number of new customers and the churn rate remain unchanged, the company will eventually reach a growth ceiling of around 2,000 customers. That is why simply trying to acquire more new customers is not enough — the company also needs to retain existing customers.
How can you find out why customers are leaving?
Cohen emphasizes that the way you ask customers about their cancellation matters.
When asked a simple “Why did you cancel?”, customers often give superficial answers such as “too expensive” or “I don’t need it anymore.”
Instead, asking:
“What made you decide to cancel?”
can help generate a more specific answer. Another important point is not to immediately treat “too expensive” as the final reason. If a customer purchased the product in the first place, the fact that price later became an issue may actually point to something deeper: the product may not be delivering the expected value, or it may be missing a necessary feature or integration. That is why reducing churn requires focusing on onboarding, helping customers realize value from the product early, and understanding their actual needs.
2. Is your pricing right?
Once customer retention is under control, the next question is pricing strategy. According to Cohen, many startups set their prices based not on the market or customers’ actual willingness to pay, but simply on assumptions. They then keep those prices unchanged for a long time.
Does raising the price always mean losing customers?
Not necessarily. In the conversation, Jason Cohen gives an example involving a B2B startup. The company was selling its product for $300 per year. It was advised to raise the price to $300 per month, making the product 12 times more expensive.
However, sales did not decline dramatically. The reason is that pricing does not only determine how much customers pay — it also signals who the product is for.
For example, a very inexpensive product may actually appear less trustworthy to large companies. Because of requirements around security, support, and integrations, they may prefer a more expensive but more professional solution. Therefore, raising prices can sometimes be less about losing customers and more about moving toward the right customer segment.
When product growth slows, the first step should not be to increase marketing spending. Instead, you should first answer three questions:
1. Why are customers leaving?
If churn is high, acquiring new customers alone will not sustain growth.
2. What is the real reason customers are leaving?
Rather than accepting superficial answers such as “too expensive,” you need to determine whether the product is actually delivering the value promised to customers.
3. Is your pricing really right?
A price that is too low can also be a problem. Pricing should match the product’s value, target audience, and market positioning.
Jason Cohen’s approach shows that when growth stalls, the problem is not always marketing. Sometimes the company needs to focus on the product itself first.
