Online Subscription Billing Is A Pain. Recurly Wants To Alleviate It.

http://www.techcrunch.com/2009/11/17/online-subscription-billing-is-a-pain-recurly-wants-to-alleviate-it/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+Techcrunch+%28TechCrunch%29&utm_content=Google+Reader

by transburgh • 17 years ago

21 23 17 years ago

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akronim2• 17 years ago

It sounds like they're targeting startups, but if you're a startup you're adding quite a bit of risk by depending on another startup (in beta) for something so critical as your cashflow. It's easy to imagine scenarios where they go bust at a critical time and take you out too.

mrkurt3• 17 years ago

We are part of a pretty risk averse large corporation, and this really isn't all that much of a consideration for us (for reference, we use another small recurring billing startup). We generally think the startup can do a better job of handling these things than we can. We also get ridiculously good service that we wouldn't be getting from a large, established company trying to shunt us through a useless enterprise sales process.

So in summary, you're kinda right, but I think it's worth the relatively minimal risk.

akronim2• 17 years ago

Yes, but as a large corp, you have the momentum to survive if you can't bill for a month, but it might be fatal for a startup.

nathanwdavis• 17 years ago

For a very young startup, the pricing structure is much better than competitors. If my revenue is really small, 3% of total rev is better than $39 plus a smaller percentage of sales.

apowell2• 17 years ago

The pricing is in addition to what you pay for your merchant account and gateway.

apowell2• 17 years ago

The API (http://support.recurly.com/faqs/api/accounts) looks very similar to the Authorize.net API, so I'm not sure that this service simplifies the integration all that much. Also, it isn't clear to me whether the accounts are stored in Recurly, or whether they are stored within the payment gateway.

Overall, I can't say that I agree with the premise -- I haven't found online subscription billing to be very painful. However, if I can be convinced that this service adds value without creating third-party risk, I'd be interested.

dangrossman4• 17 years ago

Recurly stores the payment information themselves, not through the gateway. I e-mailed them previously to ask about this. Theoretically this would mean that you can switch payment gateways and your subscriptions will continue to rebill automatically on the new gateway. It also means that if the company were to go out of business or you were to leave, they could potentially give you your customers' billing information to take elsewhere.

eo3x0• 17 years ago

Unless I am mistaken, this is also what Chargify is trying to solve. When I built my first app, I thought about spinning off the billing layer into a separate service, but then realized that established companies like Auth.net have all of the real leverage. We'll see how this plays out in the long run, but I have a feeling that these types of services are in for a bumpy ride as their customer base is probably the least stable of them all (start ups).

kapitti• 17 years ago

Chargify, CheddarGetter, Spreedly, Zuora, Aria Systems and now Recurly. Seems the space will get crowded quickly.

mrkurt3• 17 years ago

I encourage anyone who needs something like this to check out Spreedly (www.spreedly.com). We use them for the Ars Premier subscriptions and they're fantastic, don't kill us with fees, and have a really nice API.

3% of transactions on top of the credit card fees is pretty nuts.

bluebird• 17 years ago

Chargify changres nothing for the first 50 clients and then I think it is a flat fee if I am not mistaken. That can be cheaper than Spreedly. Recurly seems to be doing something similar.

What does make a difference is that Spreedly is not PCI compliant. Both Chargify and Recurly are PCI compliant.

nreece• 17 years ago

Chargify only supports Authorize.net, whereas Spreedly and Recurly support a few more options.

I think Spreedly has by-far the most reasonable and economical pricing structure for lean startups.

raghus• 17 years ago

Spreedly updated their pricing recently: http://blog.spreedly.com/2009/11/12/improved-spreedly-pricin...

mrkurt3• 17 years ago

Oh, yes. The 3% was in reference to Recurly.

jacquesm2• 17 years ago

Fair warning: get your own merchant account, never ever use a service that does not use segregated merchant accounts.

All you are doing is to allow other people to reduce their chargeback rates by diluting their volume with your charges and sooner or later they'll go down and leave you swimming.

It will take you a bit longer to get approval and you will have to pay a fee but at least you will be building a business that will last.

All you need to do recurring is an IPSP.

johnrob• 17 years ago

What is an IPSP?

jacquesm2• 17 years ago

Internet Payment Service Provider

A company that registers your merchant account with a company such as paysquare, they will take care of scrubbing and fraud control (for a nominal fee per charge) and will deposit your money in your bank account, usually on a weekly basis.

I should probably do a post on how all the items in an e-commerce transaction go together.

dangrossman4• 17 years ago

You need your own merchant account to use Recurly or any of their competitors. They are not doing the processing for you. You have to provide them your payment gateway credentials, and they make the API calls to charge customers using your own gateway (and your own merchant account). They're only handling the technical side, none of your money ever touches theirs.

jazzychad• 17 years ago

I have seen several of these recurring billing services posted lately, but no one has mentioned BillingCircle. http://www.billingcircle.com/ I use it for my startup and love it to death. Great API, ok-ish pricing, and the reporting dashboard is insane (in a good way).

dangrossman4• 17 years ago

Expensive, though.

Online Subscription Billing Is A Pain. Recurly Wants To Alleviate It.

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