SaaS Pricing Impact from AI and the Need to Manage Model Costs

Praveen Ghanta, founder of Fraction and former CEO of HiddenLevers, shares how he turned his experience scaling a bootstrapped SaaS company into a fast-growing fractional talent marketplace. After HiddenLevers reached $8M in ARR and sold for over $100M, he realized that senior fractional engineers were the secret to delivering efficiently without expensive full-time hires.

Fraction now serves over 100 SaaS clients with a vetted pool of 500 senior U.S.-based engineers and CTOs. Typical engagements run 10–30 hours a week, helping founders tackle scaling challenges in vertical SaaS, AI engineering, DevOps, and legacy system conversions. The company has reached $10M ARR in just three years while keeping half its own team fractional.

Praveen explains how clients use Fraction to save costs, speed development, and even prepare for M&A due diligence with fractional CTOs. He also highlights how AI has boosted senior developer productivity by 4x, why U.S.-only context matters, and how fractional-to-full-time hiring often becomes a win-win path.

This interview is perfect for SaaS founders at $1M–10M ARR, hitting scaling issues, vertical SaaS leaders needing senior engineers without VC funding, and founders considering AI-powered product features and engineering talent.

Key Takeaways

• Fractional Individual Contributors: Not just execs—senior engineers deliver hands-on code, marketing, and DevOps part-time.
• AI Productivity Boost: Senior developers using AI tools are delivering 2–4x more than peers without them.
• Cost Advantage: Starting at $5K/month, founders access senior dev talent without $200K+ full-time salaries.
• Best ICP Fit: Vertical SaaS companies at $1–10M ARR facing scaling issues or legacy migrations.
• Developer Productivity: Fraction leveraged its experience with over 100 clients to build DevHawk.ai, a tool that manages fractional talent and delivers results even more efficiently.

This Interview Is Perfect For

• SaaS founders stuck at scaling challenges without a budget for big teams
• Bootstrappers and practical founders looking for senior engineering firepower
• Founders facing legacy code, scaling issues, or AI feature rollouts
• Non-technical founders struggling to manage offshore or junior dev teams

Quote from Praveen Ghanta, founder of Fraction

"There are a lot of very experienced engineers who get into a senior developer role, but if they're not going to become the manager of the team, there's not a really good and obvious career path for them.

"They start to get bored because they know their job inside and out and it's relatively easy for them to keep delivering.

"So working on a startup on the side is actually a way for both for them to sort of enrich their career and see new things and have that creative satisfaction, but at the same time, not take the risk. There are plenty of folks that want to be full-time at the startup, but there's risk in being at a startup."

Links

• Praveen Ghanta on LinkedIn
• Fraction on LinkedIn
• Fraction website (fraction.work)
• DevHawk website

This podcast is sponsored by Fraction. Fraction gives you access to senior US-based engineers and CTOs — without full-time costs or hiring risks. Get 10 to 30 hours per week from vetted and experienced US-based talent.

Find your next fractional senior engineer or CTO at fraction.work. You can start with a one-week, risk-free trial to test it out.

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