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Ask HN: How do you bill your clients? (for your app)

28 points by perezd ↗ HN
We are building a software service that will be paid for based on a monthly subscription model. We are not really interested in reinventing any wheels and writing a billing system, and are interested in what you all are doing for your applications.

Do you create bridges to other third party billing system? If so, which ones do you recommend to integrate with (we are a ruby on rails application).

If you think its a bad idea to use a pre-existing billing system, could you give reasons why you feel that way?

Thanks for the advice!

21 comments

[ 3.1 ms ] story [ 70.2 ms ] thread
callmeed
If you're doing it in Rails, I'd recommend the ActiveMerchant plugin and a gateway/merchant account from Braintree.

That's what we use on our main Rails app (as opposed to PayPal on our other main subscription-based offering). It works great. The only hangup has been accepting international currencies (we're having to work with a different company for that).

The transaction fees are low, too–which actually makes a difference when you start getting a lot of subscribers.

http://www.braintreepaymentsolutions.com/ http://www.activemerchant.org/ https://peepcode.com/products/activemerchant-pdf

perezd
I've heard of this library, but does it provide a front-end admin type system? For doing things like reports and dashboards? Or is that something we have to build internally.

If we have to build it internally, that is what we are trying to avoid.

callmeed
What kind of reports do you need?

ActiveMerchant just connects your app to a gateway for cc approval and processing.

Braintree has very nice reports on transactions and it's very easy to refund a payment.

Beyond that, you are dealing with Rails after all–it's pretty easy to scaffold out some reports from your subscriber base.

wmwong
For Braintree, what are the fees like? I can't seem to find them posted anywhere. It would be nice to know to help the shopping before diving into a particular company.
markessien
They used to charge an arm and leg, but with the economy being depressed and all, they offer a discount where you pay an arm and a foot.
callmeed
I believe they resell some of the services. In our case, they had to set us up with a different merchant because we are a payment aggregator (we take payments on behalf of our customers and charge a transaction fee). I believe our merchant fees are $0.20 + 2.34% per transaction. That's still lower than PayPal unless you're doing over $10K a month. I believe they charge a monthly fee for the gateway/online services too (I don't know what it is because my biz partner handles that stuff).

All in all, I would choose this over PayPal regardless of the fees. The user experience is far superior.

bradgessler
Braintree actually doesn't work very well for recurring payments since you end up writing your own biller. They offer some sort of a subscription billing system, but since their API only works 1-day (Data-in, no data-out) so its damn near impossible to keep your system in synch with theirs.

Also, be careful with that peep-code PDF; their design isn't really the best so keep that in mind when reading through it and take their content merely as a suggestion. They couple their Orders with Transactions in a funky way.

Another thing, when dealing with BrainTree, be sure to pester them about how much the SecureVault costs. They came to us 6 months after we started using them and demanded that we pay $0.10-$0.15 anytime we touched a customer in the SecureVault. After a few back-and-forth's via email, they finally waived these fee's because they neglected to bring it up when we negotiated our rates.

In technical terms of payment gateway APIs, I liked Google Checkout's the best. They had a nice asynch RESTful XML API that made a lot of sense; although I didn't really like that fact that we had to send users through the Google Checkout screens. We had to move away from GCO because they didn't support recurring billing.

Has anybody used the Amazon Flexible Payment System?

callmeed
I should have mentioned that we're also using a modified version of the saas rails kit for our recurring billing. Works well for us (we've got over 300 subscribers last time I checked, adding about 2 a day).

http://railskits.com/

Braintree_Jamie
I'd like to clarify a couple of the topics discussed here regarding our (Braintree's) services. The recurring option within our gateway is designed for straightforward recurring billing needs. It's simple, reliable and a good tool. Merchants that need greater flexibility and/or prefer to manage the billing logic on their end, find our API's and processing quite accommodating and straightforward. All transaction data (including all custom information passed to us) is easily accessible using our Query API. Merchants can use it to pull data back into their applications, create custom reporting and manage reconciliation.

Regarding Brad's comments about our pricing, we've discussed this directly with him and agree that the specific communcation with him could have been done better. At the same time, we've expressed to him that we didnt' think the tone of his statement was fair or accurate. We always offer complete transparency in our pricing and do not use bait and switch tactics that are so commonly used in the industry.

@callmeed - thank you for your comments. You guys have been great to work with.

bradgessler
I would like to add that BrainTree our Vault situation well; they did honor they said on their website.

Another great thing about these guys is that you can actually email or call them and a person will pick up the phone. Good luck doing that with GCO, PayPal, or AFPS.

Also, as Jamie said, they offer an API to query payment data; while this isn't an asynch API like what Google offers, it at least opens up the possibility of writing a batch process that reconciles data between your application and Braintree.

Overall BT has been very responsive to our needs and, as a result, I have recommended them to many of the YC Summer '08 companies, along with many other companies I've talked to outside of YC.

jasonlbaptiste
check out zuora. if youd like an intro drop me an email: jason[at]publictivity.com
perezd
This looks very promising, but its sort of off-putting that they don't explicitly define their pricing. Is that a sign that its pricey?

I was also looking into blinksale and its API integration, thoughts?

lux
I spoke with someone at Zuora a couple weeks ago. They said it was a minimum $1,000 US / month to use their system, and I think it was around 2% as a transaction fee beyond that minimum. A bit pricey for most bootstrapped or self-funded startups I'd say. I guess they're after the big boys first...
swombat
Sounds like a great opportunity for someone to fly underneath them....
jcapote
Try railskit or servicemerchant.org
cbrinker
You can integrate your system with Quickbooks. They have an API. I don't know if you want to deal with their software, though.
josefresco
I can understand why you were modded down (boo Quickbooks) but for a lot of small business owners it's a tempting strategy. And with people out there pushing carts that integrate with QB 'out of the box', it makes building something custom for people a harder sell.
netcan
What boo Quickbooks? It's what people use. It's a bit rich expecting businesses to switch bookkeeping software (which their accountant/bookkeeper recommended & uses) because your cart has a better idea.