Ask YC: Subscription Billing For On-Demand Startup
You're a web app like beanstalk app, lighthouse, 37 signals,etc. You charge per month. How do you handle billing? What service do you use?
21 comments
We use Authorize.net's ARB platform.
But this question has come up before at HN and other places. Here are the collection of links on subscription. Pretty everything you need to know!
# http://www.sitepoint.com/forums/showthread.php?t=453028 # http://news.ycombinator.com/item?id=115723 (Recommended) # http://www.37signals.com/svn/posts/753-ask-37signals-how-do-... (Recommended) # http://discuss.joelonsoftware.com/default.asp?biz.5.550062.1... # http://news.ycombinator.com/item?id=48040 # http://news.ycombinator.com/item?id=47960 # http://news.ycombinator.com/item?id=12010 # http://news.ycombinator.com/item?id=47958 # http://news.ycombinator.com/item?id=33322 (Recommended) # http://news.ycombinator.com/item?id=49787 # http://news.ycombinator.com/item?id=12082 # http://groups.google.com/group/activemerchant/msg/635e1fec35... # http://blog.robwebb2k.com/2007/10/19/braintree-payment-solut... Braintree Reccomendation- (Recommended) # http://www.webmasterworld.com/ecommerce/3496741.htm # http://www.merchant-account-services.org/blog/building-a-rec... # http://www.merchant-account-services.org/article/payment-gat...
But this question has come up before at HN and other places. Here are the collection of links on subscription. Pretty everything you need to know!
# http://www.sitepoint.com/forums/showthread.php?t=453028 # http://news.ycombinator.com/item?id=115723 (Recommended) # http://www.37signals.com/svn/posts/753-ask-37signals-how-do-... (Recommended) # http://discuss.joelonsoftware.com/default.asp?biz.5.550062.1... # http://news.ycombinator.com/item?id=48040 # http://news.ycombinator.com/item?id=47960 # http://news.ycombinator.com/item?id=12010 # http://news.ycombinator.com/item?id=47958 # http://news.ycombinator.com/item?id=33322 (Recommended) # http://news.ycombinator.com/item?id=49787 # http://news.ycombinator.com/item?id=12082 # http://groups.google.com/group/activemerchant/msg/635e1fec35... # http://blog.robwebb2k.com/2007/10/19/braintree-payment-solut... Braintree Reccomendation- (Recommended) # http://www.webmasterworld.com/ecommerce/3496741.htm # http://www.merchant-account-services.org/blog/building-a-rec... # http://www.merchant-account-services.org/article/payment-gat...
i signed up for paypal's website payments pro but eventually switched to braintree for my corduroy (http://corduroysite.com/) application.
the problem with paypal's solution is that you either require your customer to create a paypal account which is a hassle and looks a bit unprofessional, or you store the credit card information yourself to do recurring billing. if you store credit cards yourself, in order to be PCI compliant you have to store them on a separate machine on a separate network from your web servers. if you're starting out small, that can be a big pain. paypal does offer recurring billing to an extent but you don't have much control over the process.
braintree offers "securevault" which lets you store the credit card info at their site and they return you a token for each customer. when you need to do recurring billing, you just submit the request to their server and pass a token instead of a credit card number and they take care of the rest.
the problem with paypal's solution is that you either require your customer to create a paypal account which is a hassle and looks a bit unprofessional, or you store the credit card information yourself to do recurring billing. if you store credit cards yourself, in order to be PCI compliant you have to store them on a separate machine on a separate network from your web servers. if you're starting out small, that can be a big pain. paypal does offer recurring billing to an extent but you don't have much control over the process.
braintree offers "securevault" which lets you store the credit card info at their site and they return you a token for each customer. when you need to do recurring billing, you just submit the request to their server and pass a token instead of a credit card number and they take care of the rest.
I believe paypal doesnt require customers to have a paypal account. Just entering the credit card should be fine (i.e without registration). But my usage with paypal is just as a customer though
correct. if you make your customer use a paypal account, you won't have to deal with the storage of the information which makes the whole process easier on your end (but harder for your customers).
I've read why they don't, but I really wish they included some sort of pricing information (even for an example industry/volume) on their site. Even if they're great, it makes it difficult for me to judge if it's even worth our time to investigate further. Anyone who's used them want to share feedback as to how they compare rate-wise with other providers?
http://railskits.com/saas/
Good option if you're a rails app.
Good option if you're a rails app.
On the Braintree site, which is the payment processor used by this railskit, it shows that they may not always choose to work with you if you do less than 100K a month. Has anyone had any experience with getting approved?
https://www.braintreepaymentsolutions.com/get-started-now/fo...
https://www.braintreepaymentsolutions.com/get-started-now/fo...
RescueTime uses BrainTree and they took us on without a single paying customer. This has since changed, but we are still quite a bit less than 100k per month.
on [rails-business] this was addressed as not a problem as they are trying to break into the subscription market in a big way.
We use paypal's payflow pro. I'm very much looking forward to when google checkout adds subscriptions as well.
I've been using GC for about 18 mths and we've had more than 20x the chargebacks that we've had on PayPal - just FYI.
Wow, that's huge. I assume you'll be scrapping it?
Has anyone tried http://www.zuora.com/ : Zuora Aims To Be Salesforce for Online Billing
They have some big names and they sound like a startup to look out for.
They have some big names and they sound like a startup to look out for.
Almost anything but PayPal. I have both heard and experienced too many horror stories involving that company to ever trust them with money on which my livelihood depends.
ive been through one before, but it still comes out the simplest.
Maybe it's just me, but simplicity is below reliability and "will not freeze my accounts for no reason" on the list of important qualities of a payment processor.
37signals doesn't even accept PayPal, which I think is one smart move.
37signals doesn't even accept PayPal, which I think is one smart move.
I have used and recommend TrustCommerce. And they have a feature specifically designed for recurring payments which can be implemented in your software (some solutions require you to log into their control panel to make a payment recurring). Lots of APIs for every language too.
http://www.trustcommerce.com/citadel.php
http://www.trustcommerce.com/citadel.php
Merchant account.
The downside is you pretty much need to meet the huge requirements by the credit card companies to do it on your own servers. Which is why you need to find a merchant account provider that offers a way to store the data on their servers that meet those requirements. CDGCommerce is one, it gets very good reviews on all the webmaster forums and they have good rates.
The downside is you pretty much need to meet the huge requirements by the credit card companies to do it on your own servers. Which is why you need to find a merchant account provider that offers a way to store the data on their servers that meet those requirements. CDGCommerce is one, it gets very good reviews on all the webmaster forums and they have good rates.
PayPal ftw.
I've had a good impression using PayPal so far for subscriptions and one-time buys at <a href="http://zodlogic.webfactional.com/?pc=hackernews080523">ZodLogic Games</a>.
Easy to learn, simple to integrate and test. No horror stories but my needs are simple and traffic small.
Easy to learn, simple to integrate and test. No horror stories but my needs are simple and traffic small.
Amazon also has a biling service (flexible payments service):
http://www.amazon.com/Flexible-Payments-Service-AWS/b/ref=sc...
I don't know if you can charge each month however.
I don't know if you can charge each month however.
Like PayPal, FPS requires an account with another party (an Amazon account in this case) making it unsuitable for many, including us. We can't introduce another step into the process.
That's true.
But I also see and advantage herein. You don't have to save the credit number and other sensitive details, so they can't be stolen on your servers.
But I also see and advantage herein. You don't have to save the credit number and other sensitive details, so they can't be stolen on your servers.
Both PayFlow (now owned by PayPal) and Authorize.net make subscription billing easily programmed. Authorize probably makes it a little easier because they have more code samples, but it's really just an API call for whichever.
I've used PayPal for several years without significant complaint. However, definitely pay heed to the horror stories; they are often true. PayPal's one of those services that's "excellent till it ain't."
We use Pay Pal and Cybersource (http://cybersource.com/). They are both pretty much equally easy to implement and cost about the same.
If there is anything you don't like about these services and their APIs, please let Tipjoy know:
http://tipjoy.com/feedback/
hey ivan, we should chat. jason [at] publictivity dot com
Note: there is also desktop software like ICVerify that will keep track of CC numbers and run them on a regular basis for you; I believe that it can also handle subscriptions.
a.) This costs money and b.) I haven't actually used it. But I bookmarked it a few weeks ago because it looked interesting. Seems to be a Rails implementation of the BrainTree payment gateway.
Worth a look, particularly if you're using Rails as a framework (which I guess you might be since you cite Rails apps as examples).
http://railskits.com/saas/
Worth a look, particularly if you're using Rails as a framework (which I guess you might be since you cite Rails apps as examples).
http://railskits.com/saas/
You should ideally support: MasterCard, Visa, Discover, AmEx, and PayPal
PayPal++
services we've looked at:
-zuora -aria
they want 5-10k in implementation, 1k per month minimum, and 2-4% of your sales (keep in mind, that is ON TOP of processing fees)
-zuora -aria
they want 5-10k in implementation, 1k per month minimum, and 2-4% of your sales (keep in mind, that is ON TOP of processing fees)