A customer asks for their money back. Your stomach drops. You feel the urge to explain, defend, or delay.
That urge is the enemy.
How you handle the next five minutes determines whether this person becomes a detractor or an advocate. Most founders treat refund requests as damage control. The better frame: a refund request is a trust-building surface disguised as a cost center.
When you're a solo founder, every dollar has a name. You remember the work behind the product, the late nights, the careful pricing decisions. A refund request can feel like a rejection of all of it.
But the person on the other side doesn't see your effort. They see a gap between what they expected and what they got. That gap might be your fault. It might be theirs. Doesn't matter yet. What matters is they raised their hand and told you something was wrong — instead of quietly disappearing and warning their friends.
That act — reaching out instead of ghosting — is a gift. Treat it like one.
Not every refund request deserves the same response. You need a quick mental model so you can act fast and stay consistent.
Bucket 1: Refund instantly.
The customer is within your stated refund window. Or the product genuinely failed to deliver what you promised. Or the amount is small enough that the time spent negotiating costs more than the refund itself.
Speed is everything here. Refund before they have to ask twice. Add a short, human note: "Done. Sorry it wasn't what you needed." No interrogation. No forms. No seven-day processing window.
The math is simple. A fast, painless refund costs you one transaction. A bitter, drawn-out dispute costs you that transaction plus every person the customer talks to afterward.
Bucket 2: Negotiate — but only if you can offer real value.
The customer hit a specific problem you can fix. They misunderstood a feature. They're on the wrong plan and a switch would solve things.
Offer the fix first, with the refund as a backstop: "I think I can solve this in the next 24 hours. If I can't, full refund — no questions." This moves the conversation from adversarial to collaborative. You're not stalling. You're earning a second chance with a clear deadline and a safety net.
The key: the customer must feel like they can walk away at any point. The moment they feel trapped, you've lost.
Bucket 3: Say no — clearly and kindly.
The customer consumed the full value and is asking for a refund after the fact. The request falls outside any reasonable reading of your policy. You spot a pattern of abuse.
Saying no is fine. Saying no rudely is not. Explain your reasoning in two or three sentences. Point to the policy they agreed to. Offer an alternative if one exists — a credit, a downgrade, a pause. Then hold the line.
Most founders struggle here because they fear the bad review. But a clear, fair "no" earns more respect than a resentful "fine." People can tell the difference.
A good refund policy is short enough to read in thirty seconds and specific enough to remove ambiguity. It answers three questions:
Write it in the same voice you use everywhere else. If your brand is direct and informal, your refund policy should match. A wall of legal language on an otherwise friendly site signals you trust your customers right up until money is involved.
Publish it where people can find it before they buy. This isn't defensive — it's a confidence signal. You're telling prospective buyers: "We stand behind this enough to make it easy to leave."
Here's the part most founders skip. After the refund is processed, follow up. Not with a sales pitch. Not with a survey. Just a short note, a few days later, asking what you could have done differently.
Some people will ignore it. Some will give you the most honest product feedback you've ever received. A few will come back months later and buy again — because you treated them like a person when they expected to be treated like a ticket number.
The refund was not the end of the relationship. It was a reset.
Founders track refund rates as a loss metric. That's incomplete. Track what happens after the refund. How many refunded customers return? How many refer others? How many leave public feedback — positive or negative?
When you measure the full picture, a well-handled refund often costs less than the acquisition spend you'd need to replace that customer's goodwill. The refund isn't a leak in your revenue. It's an investment in a reputation that compounds.
Your refund policy isn't paperwork. It's one of the few moments where a customer discovers what your company actually values. Make the answer worth discovering.
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