The Economics of Organizational Memory
Why we chose flat team pricing, what drives our costs, and how we think about building a sustainable business around context infrastructure.
We’re building Egregore as a sustainable business, not a venture-backed growth experiment. That means being thoughtful about economics from day one.
This post shares our thinking on pricing, costs, and why we believe context infrastructure can be a healthy business.
The Model: Free Tools, Paid Infrastructure
The CLI is free and will remain free. The hosted backend service is the business.
This mirrors successful models like Supabase, PlanetScale, and Vercel — free tools, paid infrastructure. You can self-host everything, but most teams will prefer managed infrastructure.
What the backend provides:
- Context storage (vector embeddings + raw documents)
- Quest/task state
- Handoff routing and notifications
- Skills registry and versioning
- Team management and permissions
- Org reflection engine
Why Flat Team Pricing
Our recommended model: $75/month for unlimited users on a team.
Why flat instead of per-seat?
Terminal-native teams dislike per-seat accounting. Developer tools that charge per user create friction around adding collaborators. We want the opposite incentive.
Encourages adding collaborators. More collaborators means more context, more handoffs, more value from the system. Per-seat pricing discourages exactly what makes Egregore valuable.
Predictable revenue for planning. We can forecast without guessing seat counts.
Usage overages capture value from heavy users. Beyond included limits, additional storage and retrievals are metered. Heavy teams naturally hit these; light teams never worry about them.
The Cost Structure
What does it actually cost us to serve a team?
| Component | Service | Est. Cost/User/Month |
|---|---|---|
| Vector Storage | Qdrant Cloud | $0.50 - $1.00 |
| Document Storage | Cloudflare R2 | $0.10 - $0.30 |
| Embeddings | Voyage AI | $0.20 - $0.50 |
| Compute (API) | Railway | $0.30 - $0.50 |
| Relational DB | Neon | $0.20 - $0.40 |
| Total | $1.30 - $2.70 |
At $75/month for a 5-person team, that’s $15/user effective price with 82-91% gross margin.
At 10 users, $7.50/user with 64-83% gross margin.
At 15 users, $5/user with 46-74% gross margin.
The hybrid model addresses large teams: heavy usage naturally triggers overage charges, maintaining healthy margins without penalizing normal usage.
What Drives Costs
Heavy /activity users — High retrieval volume queries the graph frequently.
Large context windows — More tokens embedded means more vector storage and embedding costs.
Real-time Slack ingestion — Constant message embedding adds up.
Org reflection on large teams — Cross-team queries are compute-intensive.
Cost optimization levers we’re exploring:
- Self-hosted vector DB (60% cheaper than managed)
- Cheaper embedding models (Voyage lite, open-source)
- Aggressive caching (most retrievals hit recent context)
- Tiered storage (hot/warm/cold)
- Batch reflection (nightly, not real-time)
The Unit Economics Story
Customer acquisition cost is low. Terminal-native tools spread through word of mouth. Developers trust peer recommendations over marketing.
Free → Team conversion is organic. Happens when handoffs become essential workflow. No sales pressure needed.
Gross margins are SaaS-healthy. 80%+ at our recommended pricing.
Retention increases over time. Context lock-in grows with usage. The more handoffs, the more valuable your Egregore history becomes.
Value scales with model improvements. Better AI models = more valuable context layer, without proportional cost increase. We’re building on an improving foundation.
The Pricing Table
| Free | Team | Enterprise | |
|---|---|---|---|
| Users | Up to 3 | Unlimited | Unlimited |
| Context Storage | 500 MB | 10 GB included | Custom |
| Retrievals/month | 5,000 | 100,000 included | Unlimited |
| Handoffs | ✓ | ✓ | ✓ |
| Skills Sharing | Community | Team + Community | Private + All |
| Org Reflection | — | ✓ | ✓ (Advanced) |
| Slack Integration | — | ✓ | ✓ |
| SSO / Audit Logs | — | — | ✓ |
| Price | $0 | $75/month | Custom |
Usage-based overages (beyond Team tier limits):
- Additional storage: $0.15/GB/month
- Additional retrievals: $0.002 per operation
- Org reflection queries: $0.10 each
What We’re Not Doing
No per-seat pricing. We want teams to add collaborators freely.
No annual commitments required. Monthly is fine. We earn retention through value, not contracts.
No feature gating on core workflows. Handoffs work the same on Free and Team. We gate scale and advanced features, not basics.
No venture-scale growth pressure. We’re building a sustainable business, not optimizing for a funding round.
The Bet
Context infrastructure is a real category. Teams that manage context well outperform teams that don’t. As AI becomes central to knowledge work, context management becomes more valuable, not less.
We’re building for that future — one where Egregore is the context layer teams rely on, priced fairly, and sustainable long-term.
Questions about pricing or economics? We’re happy to discuss. Transparency is a feature.