Jeff Cangialosi

In my current day job at Loop, I spend a lot of time thinking about recurring payments, particular as it relates to stablecoins and crypto. This means I have engaged with many subscription businesses. While recurring billing seems simple enough at first glance, it’s actually quite complex with a range of nuances and edge cases. There is a small cohort of companies that specialize in helping with recurring billing known as subscription management platforms.

While most Software-as-a-Service (SaaS) businesses (at least in the US) know of Stripe and often default to using their subscription management platform, there is a range of other companies serving this space as well. While Stripe started as a payment gateway, they have gone on to build out a full feature suite around subscription management. Other companies, like Chargebee and Maxio, start with designing the subscription management features and then allow companies to plug in the payment gateway (or gateways) after the fact.

Over the last 3 years, I’ve had the chance to dig into a number of these platforms. If you are looking for a plug and play solution that allows you to start getting paid on a recurring basis, there is a lot of overlap between the top players, and you will likely find many of the same features across the leading solutions (Stripe, Chargebee, Maxio, Recurly, OpenPay, FastSpring, Billsby, etc.) . With that said, there are subtle nuances to each platform, so I wanted to provide a rubric for some of the factors I would think about if I were in the market for a subscription management platform for my SaaS startup. Here are a few key considerations I would keep in mind:

1. Payment optionality

Does the platform allow you to plug in one payment provider or multiple? Depending on the size and vertical of your business, redundancy in payment processors can be key for ensuring that you get paid on time consistently. While a solution like Stripe provides the one-stop shop, you are then locked into one payment provider, Stripe. If Stripe can no longer serve your business because of the vertical or geographies you target, you can run into challenges with getting paid. Crypto is obviously a vertical with special considerations, but I’ve seen this a number of times where a crypto startup gets cut off by its sole payment provider and is then scrambling to find another.

Players like OpenPay and Billsby try to add unique value by addressing this challenge, allowing you to have multiple processors enabled. You can still use Stripe as one of your processing options, but if Stripe fails, you can have a fallback to another option like Airwallex or NMI. This increases payment success rates and reduces dependency risk on one provider. If you’re a small business with just a couple million ARR, this may not be an immediate concern, but as you scale, payment processor redundancy becomes critical to ensure your customers can always pay you.

2. Flexibility of pricing models

If you are offering a vanilla, flat-rate subscription model with 3 tiers of pricing, this consideration is less important; however, if you have more complex usage-based billing, this is critical. Mainstream players like Stripe do offer support for a variety of usage-based billing models, but there are specialist solutions like Orb, Metronome, and OpenMeter that are designed specifically for SaaS businesses that are charging customers based on how many API calls they make or how much storage they use in a given time-period.

Dealing with all the edge cases that arise with usage-based billing can get hairy really quickly, so it may make sense to evaluate one of these specialist solutions. For example, how well does each handle upgrades, downgrades, pausing, and cancellations? For tools like Orb and OpenMeter, they allow you to plug in Stripe as a payment processor, but their systems handle the billing logic.

3. Simplicity of the user interface and API structure

You shouldn’t need to an advanced degree to understand how to set up and manage one of these subscription management platforms. The UI should be intuitive and the general logic of the billing system should be straightforward. Most systems will be structured around a few core concepts: customers, products, and invoices. You want a logical system that allows you to have standard products with pricing that can be re-used as customers subscribe to products over time. I recommend trialing a few systems to get a sense for how they present this information and ensure that it feels intuitive and fits your business’s needs. You will spend a lot of time in this system, so you want to make sure it clearly presents and tracks who your customers are, what they have bought, and when they have paid.

4. Adaptability of the checkout experience

Are you going to use a redirect link, send invoices with payment links, or embed a checkout widget within your webpage? These are all important questions to ask yourself as you think about designing your checkout flow. Depending on your business, you may employ a couple different approaches. For example, your starter tier may have a checkout experience that lives directly on your website while you bill your enterprise clients each month by sending them a custom invoice. You want to make sure you select a system that offers a range of different payment options and ideally out of the box components that make it easy to spin up a checkout experience without weeks of front-end development work.

5. Strength of the analytics suite

Almost all of the solutions I have mentioned so far have some type of analytics suite offering. Sometimes it is included within their standard pricing, but then other times, it is an add-on for the full breadth of reports. Do your homework. There are add-on analytics services that you can buy in addition to your subscription management platform. In the early days, I would argue that you probably want to avoid those to cut down on costs. ChartMogul is one of the best add-on analytics services, so I would see how well subscription management platforms do in providing a comparable or at least passable analytics suite when you compare to ChartMogul.

6. Integrations

Finally, I would take a look at what types of integrations your subscription management platform offers. Connections with popular accounting software like NetSuite and QuickBooks is pretty standard at this point, but you may want to do a deeper dive here depending on your setup. I would also take a look at how each of these subscription management platforms handles tax calculations. Have they built this in house (like Stripe), or do they allow you to plug in popular tax calculation tools (like Anrok)?

That’s a wrap. There are certainly other considerations, but these are the six items that would be top of mind for me. I’m sure I’m missing a few considerations and each business is different, but this should give you a solid framework to get started assessing subscription management tools.