Commercial Model & Pricing
The land-and-expand economics that drive 175% NDR and software-like margins
Chapter Highlights
3 Entry Models
Funded pilot, risk-sharing, or platform license paths
175% NDR by Year 5
Compound expansion from $2M to $10M+ per account
Qualification Rules
$10M+ ACV path required for strategic investment
7.1Entry Pricing Structures
Pilot Pricing Models
Option A: Fixed-Fee Pilot
Price Range
$250K-500K
Duration
90 days
Team Included
2 FDEs + platform access
Defined use case
Conversion Rate
85%
to full deployment
Option B: Co-Funded Pilot
Customer Pays
Resources & infrastructure
Palantir Provides
Team & platform
Success Fee
20% of validated savings
3-year commitment
Conversion Rate
70%
higher lifetime value
Option C: Free POV
Price
$0
Palantir investment
Duration
30 days
Qualification
$10M+ opportunity
C-suite sponsorship
Conversion Rate
60%
highest ACV
Conversion Incentives
- ✓ Pilot fees credited to annual contract
- ✓ Locked pricing for 3 years
- ✓ Additional use cases included
- ✓ Premium support tier
7.2Platform Subscription Model
Pricing Tiers
Tier 1: Departmental
Single department deployment
Annual License
$1-2M
Users
Up to 100
Use Cases
1-3
Support
Business hours
Deployment
Single site
Tier 2: Enterprise
Multi-department platform
Annual License
$3-5M
Users
Up to 500
Use Cases
5-10
Support
24/7
Deployment
Multi-site
Tier 3: Global Platform
Enterprise-wide strategic platform
Annual License
$10M+
Users
Unlimited
Use Cases
Unlimited
Support
Dedicated team
Deployment
Global
Pricing Components
Platform License
60%
- Core capabilities
- Standard connectors
- Security & governance
Professional Services
30%
- Implementation
- Custom development
- Training & enablement
Ongoing Support
10%
- Technical support
- Platform updates
- Success management
7.3Expansion Economics
Land and Expand Model
Year 1: Beachhead
$2MYear 2: Expansion
Year 3: Platform
Net Dollar Retention (NDR) Targets
Cohort Performance Trajectory
Drivers of Expansion
7.4Qualification Rules
Investment Qualification Criteria
Market Criteria
- ✓ TAM >$100M
- ✓ Strategic industry/geography
- ✓ Competitive displacement opportunity
- ✓ Reference-able brand
Customer Criteria
- ✓ C-suite sponsorship
- ✓ $1B+ revenue organization
- ✓ Digital transformation mandate
- ✓ 3+ use cases identified
Financial Criteria
- ✓ Path to $10M+ ACV in 24 months
- ✓ Gross margin >70%
- ✓ 3-year payback period
- ✓ 5x LTV to CAC
Deal Approval Matrix
<$1M
Approval: Regional VP
Terms: Standard
Close Target: 30 days
$1M-$5M
Approval: Division President
Terms: Some flexibility
Close Target: 60 days
$5M-$10M
Approval: CRO
Terms: Custom acceptable
Close Target: 90 days
$10M+
Approval: CEO + Board notification
Terms: Strategic partnership
Close Target: 120 days
Risk Assessment Framework
Technical Risk
- • Data complexity (Low/Medium/High)
- • Integration requirements
- • Performance requirements
- • Security constraints
Business Risk
- • Change readiness
- • Political dynamics
- • Competitive threats
- • Budget stability
Mitigation Strategies
- ✓ Phased deployments to reduce risk
- ✓ Success criteria gates at each milestone
- ✓ Executive alignment on vision and investment
- ✓ Risk-sharing models for high-uncertainty deals
Summary: Commercial Model Essentials
Three entry models: Funded Pilot (85% conversion), Risk-Sharing (70% conversion), Free POV (60% conversion with highest ACV)
Platform subscription tiers: Departmental ($1-2M), Enterprise ($3-5M), Global Platform ($10M+)
Land-and-expand economics: $2M → $5M → $10M over 3 years with 175% NDR by Year 5
Qualification rules: Must have path to $10M+ ACV, 70%+ margins, C-suite sponsorship, and 3+ use cases
Risk assessment framework: Evaluate technical and business risks, implement phased deployments with success gates
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