Is Your Payment Gateway Keeping Up With Your Growth?

When you’re starting a business from the ground up, everything is done in-house with a few clever hacks (that you’re proud of) to hold it in place. It’s patchy but practical, primitive yet functional. Most importantly, it allowed you to focus on what’s important and swing for the fences. Fast forward a few years - you're growing beyond recognition and so have the workarounds as your homespun web of tools tries to keep up. 

Now rearing in front of you is a monster of complexities wielding buggy invoices and forgetful reports. It’s eating your time, resources - and your growth. 

"Our needs outgrew what we could do with Stripe Billing. Today we tried solving for Paypal, and tomorrow it will be a new payment method. It didn’t make sense to reinvest time to add more gateways. So, having Chargebee sit at the heart of all gateways supported our growth."

- Jose Enrique, Co-founder & CTO, Slidebean

You’ve built a good business, achieved product-market fit, set up stable revenue streams and now you’re gunning for unencumbered growth. Good for you! Now close your eyes and imagine how much faster you could fly without developer dependencies or complex workarounds holding you back. A single payment gateway with basic billing functionalities is no longer a mere thorn in your side, it’s a gaping wound and you’re losing blood.

Signs that your current system is eating your growth

Your technical debt is adding to the clutter and chaos

What started out with an enterprising spirit and a can-do attitude has now become a deep dark place your developers’ valuable time and resources go to die. There are a lot of moving parts in a startup business that’s getting off the ground. Running to the drawing board every time you need to update a workflow or solving use cases with dirty quick fixes can significantly slow down your growth. 

You can’t outrun technical debt. While you’re solving for a complex billing scenario, the team’s found three new bugs. All the invoices that were sent out last week need to be recalled. And oh, what’s that? You just expanded into a new market with its own tax laws and compliances.

"It just comes down to numbers. The big thing for a billing platform is not just about building, but also maintaining. If our cloud engineers are going to be building, maintaining and expanding what our billing architechture looks like internally, then they're not focused on scaling our value prop. And if they're not building the product, we need to hire someone else to do it. Or we could pay Chargebee $5000 a year. It's just a numbers game if that's the way it works out."

- Nathan Field, Head of Marketing, Drawboard

A look at Drawboard’s story teaches us the importance of hanging up your homegrown billing system and doing so at the right time. When they were launching their second product, Bullclip, a central platform for design review, they decided that building the billing architecture was going to impact Bullclip’s launch. They were spending an engineering salary of over 100K to simply maintain a billing component. By spending AUD5000 a year on Chargebee, they launched Bullclip and were able to scale from being a local Australian firm to global markets with many enterprise accounts.

The amount of manual labor you do is growing exponentially

Regardless of your stance on the potential robot uprising in the future, you can’t deny that automation is now undeniably a key growth driver for businesses. 

As you scale up and your customer base grows, the resulting volume of billing operations (which is a healthy sign for your business) spells trouble for your finance team. They’re struggling to keep up with pro-rata calculations, credit notes, reminder emails, and manually reconciling month-end books; and yes, hiring more people to handle it is throwing good money after bad. 

"Chargebee automates a lot of the processes that we hadn't even thought we would automate. We thought we'd need to do more work but, actually, Chargebee does a lot of the heavy lifting that we didn't expect intially."

- George. K. Tsigounis, (Former) Product Manager, A Cloud Guru

With an in-depth billing automation solution like Chargebee, A Cloud Guru, an Australian cloud training platform was able to go to market with their new subscription model in less than a month. Freeing your team from manual redundant tasks allows them to direct their time to more strategic tasks that directly benefit the bottom-line of your organization. You improve the value proposition of your finance team and your customers get a smooth and error-free user experience - it’s a win-win for everybody. 

Your payment gateway’s capabilities dictate your expansion plans

You’re crossing remarkable milestones and you’re gearing up for your product’s next growth spurt. But as you chart expansion plans, you know it brings a whole boatload of new tax laws and compliances for your finance team. 

Your bookkeeping team’s going to struggle with sending tax-compliant invoices in addition to their current load. Operating in different geographies would require multiple payment gateways and currencies - that your current system can’t handle.

"We won our first 100 customers. We were very excited about the next phase of scaling. The new geographies we’d enter, the next level of customers we’d acquire. But, this growth brought new challenges and almost a new operational obstacle every day."

-Benjamin Jaboeuf, Head of Operations, Instaply

Even the thought of expanding to Europe seemed expensive to Instaply. They made the right call and roped in the professionals. Chargebee helped them handle wire transfers, handled tax, language and currency complexities, and automated their entire revenue subscription workflow. Confident and worry-free, Instaply was able to expand to France successfully. 

Setting up billing operations for a global market is no mean feat. And while you wait for your finance team to patch a solution together, your GTM plans get delayed. Worse, your growth plateaus. 

When should you move to a robust billing system?

If you’re a startup that’s scaling rapidly, is aiming for hypergrowth, but is still using a homegrown billing solution built on top of a payment gateway - ding, ding, ding! 

If you need more convincing, we broke it down for you. It’s time to move if: 

1. You want to tap into new revenue channels 

As a startup founder, you’re aggressively passionate about growth, and rightly so. When you’re brainstorming new revenue channels, the last thing you want on your mind is operational difficulties. As your customer base grows to include different segments, you might want to add a self-serve portal or enable your sales team by optimizing your quote-to-cash cycle.

As a sales-driven company, Coorpacademy, a learning experience platform, realized their quote-to-cash cycle was too long and siloed, resulting in costly errors and lost deals. With Chargebee’s deep two-way integration with Salesforce and Xero, their sales team was able to significantly optimize their quote-to-cash cycle and achieved 2x acceleration in their recurring billing workflow.

Or you could go the self-serve route, like Trusted Tech Team (TTT) did. When TTT, a software reseller, noticed an inflexible billing process that made even simple requests like changing the number of licenses cumbersome, they quickly caught on. With Chargebee’s self-serve portal, TTT doubled their revenue projections and maintained a churn rate of less than 1%. 

Countries around the world have distinct cultures. They also prefer different payment gateways. When you’re treading new waters, little details like the absence of payment options or native currencies could make or break a sale. Even if you manage to write-off payment options as a nice-to-have feature, an incontrovertible requirement of operating in global markets is complying with local tax laws. And manually handling tax and compliance is a battle you’re not going to win. 

When Italy suddenly announced mandatory e-invoicing, it threw a wrench in Voxcloud’s plans. Already bogged down with EU-VAT, GDPR, and late payments, Voxcloud decided to enlist Chargebee’s help. By automating compliance and using smart dunning to recover failed payments, Voxcloud managed to conquer its compliance woes and scale globally. 

Read Voxcloud’s story here.

2. You want to simplify complex billing scenarios

To be specific - complex subscription billing scenarios. 

Let’s be real, ‘billing’ doesn’t sound that challenging. It evokes a picture of a supermarket where you pay for the item you picked. Simple, right? 

Billing by itself is straightforward. Subscription billing, not so much.…

What if a customer wants to cancel mid-cycle? Or if they want to upgrade from a monthly subscription to a yearly one in the middle of the year? Throw in one-time charges, multiple billing periods, discounts, credit notes, and prorations; it can give any accounting team nightmares. And we haven’t even touched upon revenue recognition - that’s a beast by itself.

Your billing system is a critical part of your revenue engine. These are high-stakes processes that get the cash into your coffers. Inaccurate revenue recognition can mess up your financial statements and subsequently your projections. Not complying with revenue recognition standards can turn into an expensive mistake. Customers don’t enjoy being billed for the wrong things or getting in touch with you to correct them. Slip-ups in this department can quickly cost you your reputation.

Fishburners, a collaborative community for world-class founders, found that their accounting team was struggling to reconcile data between the payment gateway and their books. Their manual operations simply couldn’t keep up with the company’s growth. 

If you can automate it - you should. And that’s what Fishburners did. By automating their entire billing process - calculating prorations, sending tax-compliant invoices, reconciling revenue - Fishburners saved 105 hours/month of manual accounting and scaled across 3 geographies effortlessly.

"Our 'accounts team' have gone from doing admin billing work to proactively analysing our rveenue figures in Chargebee to create strategies to sustain revenue growth. This used to come from the top-down in the team. However, Chargebee has enabled the whole team from the bottom-up to move to a data-driven decision making."

- Ayush Patel, Finance Manager

Chargebee’s Billing LogIQ gives you extensive customization in billing cycles and recurring billing scenarios. Map your billing workflows to your business logic and scale them across multiple products, geographies, and revenue channels. With Chargebee, your billing engine is a well-oiled machine; efficient and accurate (we go up to 20 decimal points!). Pick your jaw off the floor, put your billing on autopilot and enable your accounts team to be better value creators.

3. You want to run pricing experiments and expand your product line

There are 4 major types of pricing; Flat-rate pricing, Usage-based pricing, Unit pricing, and tiered pricing. There is one that fits your business model and value proposition perfectly and you deserve to go out there, experiment a little and find out which one it is - without your whole billing system crashing down. A powerful billing engine gives you the flexibility to roll out pricing experiments, keeps the show running, and if things don’t go your way, it quickly lets you roll back your changes. No harm, no foul. 

A study found that continual price optimization can help lift up your growth trajectory in a matter of months. And we’ve seen it in action. Superfoods, a natural, plant-based product company saw a 4x growth in revenue in 12 months. By continuously iterating their pricing strategy using Chargebee, they increased their subscriber base from 10,000 to 200,000. 

“30 minutes is all it takes to roll out a new pricing experiment!” 

- Paul Kapsner, Director of Finance, Superfoods Company

With Chargebee, you don’t just get to whip up new pricing models and configure complex billing scenarios in a matter of minutes, you actually get to step through the space-time continuum and see it in action. No, we’re not kidding. The Chargebee Time Machine allows you to schedule and simulates your subscription behavior so that your experiments don’t have any embarrassing outcomes (!)

Another critical thruster in Superfoods’ growth engine was its expansion from a single product to a 5 product family. With Chargebee’s Product Catalog, they significantly reduced their go-to-market time for new product launches by effortlessly configuring add-ons, discounts, and product bundles with a few clicks. If your growth plans involve expanding your product line, a scalable billing infrastructure is a must-have. 

"Chargebee has become a part of our product roadmap now. Whenever we launch a new product line we are assured that Chargebee will handle the revenue operations side of things from day 1."

- Paul Kapsner

4. You want insights into your revenue engine 

If you’re gunning for hypergrowth, shoddy reporting won’t get you there. Building a kickass business requires a healthy obsession with your unit economics and churn reports. And that means you should work on improving your MRR and not worrying about the discrepancies between the numbers in your payment gateway and your books. 

Analyzing your customer journeys and their engagement with your product can give you highly valuable insights that can drive product decisions. But your data-driven decisions require credible data.

“A lot of accounting systems do not understand the logic of subscriptions. So, they don't show a large part of MRR. They probably connect to payment gateways and collect payments. But to get the whole reporting in terms of subscriptions, different plans, and billing dates — that is challenging. And that's why you need a solution like Chargebee that understands this better.” - Katharina Baudrex, Head of Finance, Userlane

With Chargebee, Userlane got a holistic view of their customers across payments, invoices and subscription metrics. They were able to understand their customers’ lifecycle better and were able to accurately forecast their cash flow.

Chargebee gives you a 360° view of your subscription business; churn reports, deferred revenue reports, subscription analytics, billing and revenue leakage reports, transaction analytics - the whole nine yards with your own zero-code report builder. More importantly, it centralizes all the different streams of data from your subscription business, allowing you to identify patterns and relationships between core metrics. 

AXSemantics, an automated content generation tool, discovered Chargebee when they were searching for a platform to monitor core business metrics. Manual reporting was slowing down their campaigns and they didn’t have visibility of the impact of their experiments. 

"RevenueStory for Chargebee enabled us to get really deep into our business financials, reducing our reporting effort basically to zero, while adding extensive options for explorative analysis - all that based on the existing information in Chargebee."

- Robert Weissgraeber, MD & CTO of AXSemantics

With Chargebee’s comprehensive reports, Robert and his team identified the actual variables that were impacting LTV (Lifetime Value), recognized patterns among their high-performing executives, and were able to align their sales and customer processes to emulate them. 

5. You don’t want to lose cash to failed payments 

Losing customers hurts. Losing them to failed payments hurts even more because you know that’s a deal you had in the bag - until you didn’t. As a startup, reducing churn is one of the things that will keep you up at night. You should be worrying about fine-tuning your value proposition, bringing in the right customers, and retaining them; in other words, voluntary churn is your product team’s purview. 

Involuntary churn - failed payments, expired cards, payment follow-ups - is an operational problem that’s screwing up your retention. According to a Profitwell study, 20-40% of your churn comes from credit card failures (!)

A smart billing solution like Chargebee can instantly improve your revenue recovery processes. With features like automating recurring payments, auto-verifying card information, and customizable email triggers, you needn’t ever worry about losing a payment because of a glitch. 

Read about how Chargebee can help you take the pain out of collection efforts

During a typical month at Deliverr, an eCommerce fulfillment company, their five-person finance team would have hundreds of thousands of dollars worth of unpaid invoices. Manually invoicing and sending reminder emails wasn’t moving the needle. When they decided to upgrade to a powerful billing engine like Chargebee, the results were staggering. 

"Thanks to Chargebee, I spend no more than 1-2 hours every week on accounts receivables. We have been able to reduce our unpaid invoices by atleast 80% while we have grown by 600%"

- Daniel Chan, Finance Manager, Deliverr

And it gets better. Automating your payment recovery workflows doesn't have to mean everyone gets bombarded with the same emails/treatment. Chargebee's smart dunning customizes the payment retry frequency based on analysis of past transaction data to achieve a better success rate. 

Zenchef, a France-based restaurant management platform, recovered 60% of its unpaid accounts using Chargebee’s smart dunning capabilities. 

6. You need a command center for your business; no more app-switching 

They say it takes a village to raise a baby. If you’re a startup founder, you know that building a business can be equally challenging (sometimes, more). There are several critical parts working in tandem at the heart of your business and a large part of your effort goes into ensuring that they are completely in sync. Because even small communication gaps between your CRM and accounting tools could end up creating revenue chasms in your financial statements. 

As you build a tech stack for your business, it’s imperative that the tools work seamlessly with each other to give you a coherent view of your business operations. 

With its integrations, a robust subscription management system like Chargebee could act as your command center giving you visibility into all the workflows within your business - sales, revenue, billing, customer success, and eCommerce - from right within the app!

Ultimately, Chargebee has a triple use in CircleLoop - it is used by our accounts team from an accountancy point of view but also from our Operations/Marketing Team from a revenue vs spend perspective. The third use is by my Customer Success team who use Chargebee to manage customer invoices, account queries and to add in non-recurring charges such as porting numbers or bespoke call recording usage.

- Dylan Walsh, Operations Manger, CircleLoop

7. You don’t want to lose customers at the last mile 

After you’ve painstakingly brought your future customers from awareness to acquisition, that last mile from the checkout page to the payment confirmation page can stretch like a treacherous abyss, rife with potential triggers that could turn off your users. 

Like someone playing Operation, you have to move very carefully to construct a perfect checkout and self-serve experience that cinches the ideal buying journey. 

Chargebee Moments helps you build your ideal checkout experience. You can pick and choose the widgets for your self-serve portal, bring in your brand colors for consistency or even pick an off-the-shelf option if you don't want to bother your development team.

Chargebee Moments: Seize that Moment of Truth.

Codacy, a DevOps Intelligence platform, built its own billing system on top of a payment gateway. No strangers to coding themselves, they figured that they could add features when they wanted to. With time, they realized that bug fixes were eating up their time and that handling payment-related data meant keeping up with compliance standards. 

"We understood that if we tried to do it all, we were going to fail. Rather than having to worry about PCI Compliant pages & security, Chargebee's checkout pages that take care of all of these was a huge win."

- João Caxaria, CTO, Codacy

Read Codacy’s story to know how they used Chargebee’s hosted checkout pages to relieve themselves of technical debt and compliance woes. 

Your Payment Gateway + Chargebee: Better Together

If you found yourself relating to any of the use cases we just discussed, it means you’re growing and that’s good. There are several reasons a startup can outgrow a payment gateway but it’s always inevitable. 

When you are on the hypergrowth path, you need to dream bigger - bigger than a payment gateway. Moving to a powerful subscription management platform like Chargebee allows you to proactively unlock growth opportunities and effectively future-proof your business. If you wait until you have growing pains, you’re already late. 

Your payment gateway + Chargebee can be the powerhouse of growth that your business needs. 

Accept payment through your payment gateway and leave the rest to Chargebee. 

Welcome to the big leagues. 

Schedule a demo with us to learn how your business can grow with Chargebee.