Congrats, Chargify merchants! You’re growing your businesses quickly!

In January, 2012, in the aggregate, Chargify merchants billed their customers a total of $5,300,000.

That’s a huge step above December, 2011, which was $3,900,000.

That represents month-over-month growth of 36%!

Now, that kind of growth is unusual, but we still love to see our merchants all growing. Crossing the $5 million mark is a great way to start the new year.

From our smallest and newest merchants, to our largest and most established, we wish everyone a great 2012.

Thanks for using Chargify!

As you may know from several earlier blog posts, we’ve been working since late November to expand our systems and replace inefficient parts to handle the growth of our merchants and their customers.

The last couple of pieces fell into place this week:

1. Adding yet more web servers and process servers. Our final batch is running and ready to go, but we’re waiting for our data center to add them to their load balancers, which has to be done during a maintenance window of their choosing. Systems have been running well since our last round of upgrades, but we want to get out way ahead of your needs!

2. Our first focused system administrator, Drew, started taking over tasks that used to be handled by our software developers and data center system administrators. Having someone who’s more focused in his areas of expertise, and who can spend time on systems-level things, is already yielding noticeable benefits to Chargify and our merchants and their customers! Happy to have you, Drew!

Our goal, of course, is for you to know less and less about this kind of work, becuase there will be no need to ever think about it.

Thanks!

—- Lance Walley, co-founder/CEO

NOTE: THERE’S A NEWER BLOG POST ABOUT WHAT WE DECIDED. The following is interesting, but if you just want the summary of what we decided after 3 months of engaging our customers, click the link above to see it.

UPDATE 1: GREAT RESPONSE
Response has been good. Thank you! While no one enjoys a price increase, almost all communications have been positive. People are basically saying, “I know you need to run a good business and that’s important to my business, and I appreciate being part of the conversation.” Again, thanks. Please keep your thoughts coming.

UPDATE 2: MARK CUBAN
Mark Cuban is not behind this! But I asked him, and he does agree with it. We founders put in more capital than Mark did, but his contribution was very useful and he owns enough equity to be interested. He does not tell us what to do, but he does give good advice.

We just realized that, with 800 businesses depending on us, it’s time for Chargify to get profitable. And, by the way, I’m not paid anything. I’m in no big hurry, but the work I do needs to be paid (to someone, if not me). The continued (long-term) lack of pay for that work perpetuates a “false cost structure” that doesn’t represent reality.

All Mark Cuban did was agree with my statement in January, after I reviewed finances & projections, that, “It’s time we actually invest the capital we have, rather than burning it on operational losses.”  To that, he said, and only said, “Amen”.

ORIGINAL POST

It’s time to plan a pricing change for May, and we’d like our merchants to help decide the outcome.

Chargify is a team of 11 people, developing new features, working on infrastructure, training more support people, etc.

Looking at our costs and revenue, we need to raise prices a bit. It’s been 15 months since our only other price increase, and we’ve learned a lot.

Someone commented that they definitely don’t want Chargify to “go the way of the dodo bird”! That’s nearly impossible, given our history and backing. We just want to avoid a path of long-term mediocrity.

We’re aiming for June and we’d like our merchants’ input.

Recent events that crystalized our thinking

We spent December & January adding infrastructure and new people, plus making architecutural improvements.

While this was going on, our systems were slow, and merchants were not happy. They told us this story over and over:

- I have a decent business.
- It depends on Chargify.
- Make sure you have whatever you need to support me.
- If you’re not charging enough, please, just charge me more.

These merchants expressed a desire to “just pay more” if that’s what it takes. Their feedback drove us to look into many things more deeply.

What’s driving the need?

While we were working through the technology issues, we were also looking at costs versus revenue, gross margin, how we use capital, etc.

My experience and gut told me that when you feel that kind of stress, it’s almost always a sign of not charging enough.

One person asked why we can’t more accurately predict our costs in advance, and therefore avoid this kind of change. Well, we definitely try. But only with time can we really see what kind of weight 800 businesses are going to put on our organization, and then we can see how many support people we need (and what balance between Level 1 & Level 2), how many software developers, how much infrastructure, etc. The picture gets clearer over time, and that’s why we have to make adjustments.

Here are some of the costs that I’m talking about:

- One of our merchants mentioned this to me recently: our responsibility is increasing all the time. As our merchants “get serious” versus where they were 1-2 years ago, they want a different company (they need a different company, even if they don’t know it). Mistakes become intolerable. Just approaching that ideal is expensive, and in general, increased responsibility must be balanced with higher revenue/profit (if you don’t, then you’re headed for stress and problems).

- Our people are the largest expense, and they should be. They’re what you depend on today and for years to come. Our team is all in the USA, except one, who’s in Canada. Both places have high labor costs relative to other parts of the world.

- We have a Level 1 team that answers phones 24/7. They’re a large team and their expertise varies from shallow to very deep - at a minimum, they can wake up our developers if there’s a real emergency. In most cases, merchants call with questions about coupons or refunds or email settings, etc., and our Level 1 team does a great job.

- We have a Level 2 “developer-grade” person who can look at your code and help debug API calls during integration. He gets involved on the hard stuff. He’s expensive, as good software developers usually are, so we limit access to him.

- We have 4 Ruby developers who work full-time on improving our system. One member of the team spends a lot of time now on service & support (ie, a merchant needed emergency help Friday night because of something that changed in his business, and one of our developers jumped in to help him out on Friday night and Saturday afternoon). Also expensive, so we do our best to limit access when it comes to service & support.

- We have a sys admin who’s doing more and more critical low-level stuff that our Ruby developers and data center staff used to do. We passed the point where having Ruby developers and data center staff was the right answer.

- Our PCI-focused data center is expensive. They have 24/7 staff who do all the usual data center stuff, plus they take on some roles required for PCI certification. It’s more expensive than AWS, Rackspace, Engine Yard, Heroku, etc. Other options have come about for PCI, but they always shift more of the human costs to their customer (us), so we don’t escape the true costs of PCI, even if the compute resources are less expensive.

- We manage hundreds of thousands of subscriptions each month. For every 100,000 of our merchants’ paying customers, we manage another 300,000 of their non-paying users. The numbers are pretty incredible.

Where prices started and where they need to go

When we set prices in 2009, we didn’t have any history to go on. We wanted to make Chargify free for most merchants starting out, and we set prices much too low relative to the cost structure that unfolded.

So, in late 2010, we increased prices. A price tier that had been $0 moved to $39, another that had been $49 moved to $99, etc.

Now that we have another 15 months of history and we can see more clearly how our cost structure grows with merchants, it’s time to make a change.

We need to increase fees 30-40%. While this is a noticeable percentage, it’s a much smaller increase than our 2010 price change. We’re zeroing in on the proper cost/price/profit balance as we develop with our merchants.

Here are some examples of the change you can expect.

Your individual increase will vary because we’re going to spread the cost over different things, some of which you’ll use and some of which you won’t.

$39—> $59
$59—> No Change (you’re on a new plan that was bumped up from $39)
$99—> $129 to $139, perhaps $149 in some cases
$349—> $449 to $499
$999—> $1,299 to $1,499

The ranges above give you an idea of what to budget for, no matter how the details get worked out.

To do this, we’re thinking about fees like these:
- Charging more for subscriptions (paying and/or non-paying subscriptions).
- Adding some new premium services (like accounting integration).
- Adding an “extra site” fee after your first 2 sites. We haven’t decided yet if we’ll count test sites & live sites, or only live sites. Most merchants have 1 test + 1 live site.

How to structure the changes

Here are 3 paths we’re considering for May:

Path #1
- Current price plans stay in place, but they go up a bit, like $39 to $59, $99 to $129, etc. (note that today’s $59 plans are already there; they used to be $39).
- New fee of 1-3 cents per month for each of your non-paying users. Non-paying users are subscriptions that are active but non-paying, such as someone on a free trial or a free product. Someone who has been cancelled does not count.
- New fee of roughly $20 per month for each site you manage after your first 2 sites.

Path #2
- Current price plans go away.
- New fee of 1-3 cents per month for each of your non-paying users.
- New fee of 10 cents to $1 per month for each of your paying customers.
- New fee of roughly $20 per month for each site you manage after your first 2 sites.
- New base “packages” for support levels, included premium add-ons like accounting integration, SLA, etc.

Path #3
- Current price plans go away.
- New fee of 10-30 cents per month for each of your paying customers and your non-paying users.
- New fee of roughly $20 per month for each site you manage after your first 2 sites.
- New base “packages” for support levels, included premium add-ons like accounting integration, SLA, etc.

Path #1 keeps our “legacy” price plans but adds some granularity with the incremental fee for your non-paying users. Some people like this because it doesn’t change things much.

Paths #2 and #3 remove our legacy price plans and go for a completely granular ramp in prices as you grow your business. #2 maintains different costs for your paying customers versus your non-paying users, where #3 flattens things down to a single fee for all of your customers/users, which is kind of elegant (I’m pretty sure Amazon Web Services would do this).

Notes:
- We’re giving wide ranges on per-subscription fees, because paying & non-paying subscription fees will affect one another, and because there will probably be quantity breaks.
- There’s a wide range in our merchants’ ratio of paying-to-non-paying users. Many merchants have no non-paying users. Many have a ratio of 1:5 or 1:10. Some are 1:30 or 1:100. Those ratios will help us determine how to set fees. The less we collect for non-paying users, the more we need to collect for your paying customers.

Can’t we just wait it out?

If the solution was just a matter of generating more revenue with more merchants, we’d wait, but that’s a dangerous route. In almost every business I’ve been part of, once you have a decent number of customers, adding more customers with incorrect pricing just makes the problem worse.

And throwing capital at it doesn’t fix a basic pricing error, either - it just covers it up. Again, if we thought the pricing was right and we just needed to grow a little more, we’d wait. We have capital and access to more if we ever need it, but this issue is more basic than that. We’re not charging enough, whether we have 800 merchants or 2,000.

The good thing is that this pricing change is a lot smaller, as a percentage, than our 2010 change. We’re definitely zeroing in on the right cost and price relationship as we build the business and our customer base.

No grandfathering

We’re not going to grandfather our current pricing, but we’re giving 2 months for merchants to adjust, plan, and give feedback to help us determine the exact outcome.

You may wonder why we don’t grandfather our current pricing.

It’s because we’re in a market where growth is relatively slow. We’re a service aimed at a specific segment of small/medium businesses. It’s not a fast-growing consumer market.

So it will take time to double or triple our customer base, and during that time, we can either run a business that’s a bit too tight, or we can adjust prices to provide a better service and to more fairly distribute costs.

I know a few readers will ask, “How do I know Chargify won’t raise prices again & again?”

For starters, it’s neither enjoyable nor easy.

Our aim is to keep growing the business and adjust occasionally, until we reach a point when no further adjustment is necessary. Someday, I want to lower prices.

Comments or Need Help?

Our goal is to provide a great company that supports our merchants today and for many years to come.

Tuning our pricing is a critical part of maintaining that goal.

As with our 2010 price increase, if these changes will put extreme pressure on your business, let us know. We may be able to stretch your transition over a few extra months.

You can always reach our support team at 800-401-2414 or by submitting a written ticket at http://help.chargify.com

And I’m available directly at 415-244-0349 (cell) or lwalley@chargify.com

Thanks.

—- Lance Walley, co-founder/CEO

Our dev team shipped something that a lot of merchants have been waiting for!

We just went live with “Components on the Hosted Pages”

See the hosted page below? There are two options that allow the person signing up to choose exactly what they want!

In about 2 seconds, you can add Quantity Components and On/Off Components to your Chargify-hosted product signup pages. Just click the new box on your component settings page:

This is really useful for merchants who want to sign up customers and have their customers choose ‘x’ number of licenses or some optional add-ons, like an SSL certificate for $20/mo, etc., with no programming work at all.

Whatever you can define with Quantity and On/Off Components can now be offered to your new signups.

Editor’s Note: This was indeed an April Fools joke.  There’s a lot of truth in the post, and a few good ideas that are not too far fetched.  But rest assured we wouldn’t charge your customers without their consent in an irreversible way.

We don’t normally release features on a Sunday, but this one just couldn’t wait!  I’m excited to tell you about “Predictive Charging”, our latest feature which is sure to improve the experience for all Chargify merchants and customers!

You may have read (and noticed) that we’ve been working to improve the speed and stability of our systems lately.  Thanks to these efforts, we’ve reduced our average response time by over 75% in the past few months.

There’s one large hurdle, though, that remains in the way of improving the speed of signups even more: the external gateways where we send credit cards for charging.  During a signup, we send the credit card to the gateway and have to wait on a response before we can give feedback to the customer.  This is frustrating, because sometimes the gateways can take 6 to 10 seconds to respond.  That’s why we’ve introduced Predictive Charging for our hosted signup pages.

How Predictive Charging Works

1. We monitor the usage patterns of the potential customer to make a prediction about whether they will carry though with a subscription purchase or abandon the form
2. As soon as a likely-to-purchase customer has entered necessary credit card information such as number and expiration date, we use client-side technologies to perform a purchase against the gateway IN THE BACKGROUND.  The customer doesn’t even know that they’re making the purchase yet!
3. Once the customer finishes the form and finally presses “Make my Purchase”, we usually already have the credit card gateway results, so we can display to them almost IMMEDIATELY if their purchase was successful or declined!

How We Predict a Signup

Our new technology judges the potential customer’s intent by considering the speed, accuracy, and “gumption” with which they have filled the form.  Given this, we can predict fairly accurately whether the person on your signup page is:

(a) an authoritative, decisive winner who knows what they want and has no time to waste, or

(b) a wishy-washy, spineless individual who is going to fill out your whole form “just to see how much shipping costs”

We only enable Predictive Charging for those in the (a) category

What Happens If the Customer Changes Their Mind?

First off, this probably isn’t going to happen right?  If you’ve made your product or service compelling enough, there’s no way they are going to abandon the checkout process.

If they do abandon, we try our best to detect this scenario so we can void the purchase at the gateway.  This is new technology, and its kind of hard to detect the case where the user walks away from their computer or just closes their browser - but we’ll try!

Conclusion

There’s no need to turn this feature on.  We’ve gone ahead and opted-in all merchants who use our hosted signup pages.  Your customers are going to love it!

If you really need to disable this feature, you can simply visit this page.

We sent this update to all of our merchants via email, and someone suggested we blog it, too.

It’s a summary of all the software work we did in March.

The BIG things we worked on (and last 2: still working on):

* Added components to hosted signup pages.
* Added “Organization” field to hosted signup pages.

* Added PayPal Website Payments Pro as a gateway option for US, UK, and Canadian merchants.
* Added support for refunds to be processed in Chargify through the Braintree payment gateway.

* Added “Events” API endpoints, which provide all sorts of event data (signups, upgrades, cancellations, etc.).
* Added API rate limiting system (late-stage testing now).

* Added foundation for better stats/charting for things like LTV, churn, and other data (early-stage testing soon).
* Added count of failed signups to daily status email.

The LITTLE things we worked on:

v1.19.0 Released (March 29, 2012 04:15 PM EDT)
* New: Refunds on the Braintree Blue gateway are now supported.
* Fixed: A regression on an earlier fix was causing paid statements to show “PAID” in red instead of green

v1.18.8 Released (March 28, 2012 12:37 PM EDT)
* Fixed: The `per_page` value was incorrect for API requests initiated with an Accept header (not with a suffix, i.e. `.json`).
* Fixed: The transactions page generated an error in cases where a subscription had been deleted manually.
* Fixed: Archived components were showing on the hosted signup page.

v1.18.6 Released (March 21, 2012 02:25 PM EDT)
* New: Added an “Organization” field to the customer section on the hosted pages.
* New: Daily status email now includes a count of failed signups.
* Fixed: Error message for CVV code was not always showing on hosted signup pages.

v1.18.5 Released (March 19, 2012 1:15 PM ET)
* Fixed: In the previous deploy (v1.18.4), we accidentally rate-limited 2 merchants use of the API, even though we thought we were just counting/monitoring the number of API requests being made. This fix ensures that we’re really just counting/monitoring API requests.

v1.18.4 Released (March 19, 2012 10:05 AM ET)
* New: The upgrade/downgrade migration tab on a subscription is now hidden when the subscribed product family contains only 1 product.
* New: Began counting & monitoring API requests to better understand how API rate limiting should be designed for the Chargify API.
* Fixed: Server error that occurred when viewing some statements for products with trial periods.

v1.18.3 Released (March 15, 2012 11:35 AM ET)
* Fixed: Bug in the Migrations API that was not applying coupons by default when migrating a subscription. Coupons are now appropriately applied by default upon a subscription migration. Check out the updated Migrations API documentation regarding the include_coupons input attribute if you need more control over this behavior.

v1.18.0 Released (March 13, 2012 5:32 PM ET)
* New: Enabled PayPal Website Payments Pro as a gateway on new accounts and new sites.
* New: “Add Coupon” page now shows a scrollable list of all available coupons (rather than a truncated list).
* Fixed: Bug with PayPal card update operations encountered when update authorization failed.
* Fixed: Failure to “retain” payment methods in the Samurai payment gateway.

v1.16.4 (March 2, 2012 6:18PM EST)
* A small bug fix release.
* New: Ordering on the “Activity” tab for a single subscription shows most recent activity first.
* Fixed: Payments from a subscription reactivation were not properly reflected in the “Activity Stream”.

We blogged about new pricing ideas back on February 29th and then followed up with emails to all merchants. Those communications led to many one-on-one emails and phone calls with you over the past 3 months. And those conversations helped us design the substance and timing of this new pricing & feature release.

First off, we’re rolling this out over the course of June and July:

If you sign up ON OR AFTER June 1st, then you’ll be on one of our new plans from the start.

If you signed up BEFORE June 1st, then we’ll assign you to the new plan that’s equivalent to your old plan, BUT you’ll have the whole month of June to confirm or change your new plan. You’ll pay your old plan price in June and then your new plan price starting in July.

We’re rolling out new features that will only be available on our new plans, so some older merchants may decide to start on a new plan even before July.

WHAT WE LEARNED FROM MERCHANTS

In the many interactions we had with merchants about this, a few things became clear, like:

* You’d like our pricing system to stay largely the same as it is today.

* You’d like an easier “ramp” from plan to plan as your business grows. The “bump” from, for instance, the old $99 plan to the $349 plan, was a bit painful as you grew from 500 customers to 501. You don’t mind the “bump” if you want the next-higher plan for other reasons, such as a new feature or a better level of support… but you’d like the option to “ramp” up from plan to plan if that makes sense for you.

* You don’t mind paying for your non-paying (free) users on our system, BUT you’d like to pay very little, like 1 cent each, and you’d like to get some for free. Most of you are happy to pay more for your paying customers if that means paying less for your non-paying users.

HOW NEW PLANS COMPARE TO OLD ONES

Here are the differences between old and new plans. The image below just shows a few details. Click on it to see support levels, number of customers and non-paying users included with each plan, etc.

* Free Plan: Our free “Developer” plan remains unchanged. You can try features and use almost all API functions (with the exception being “Chargify Direct”).

* Customer Count: In this respect, the new plans are almost identical to the old ones. You’ll notice that each new plan has a number of included customers, and in most cases, those numbers match old plans exactly. We increased the smallest plan from 10 to 20 customers, and we combined the 2 largest old plans into 1 new plan. In all cases, once you reach the maximum number of customers for your plan, you will NOT be “bumped” to the next plan. That’s what we used to do. With these new plans, you can stay on your plan and just pay a small “ramp up” fee for each new customer. (See “Ramp-Up Fee”, below, for more info.)

* Features: All new plans have the same set of basic features as the old plans, which is to say, they have the Chargify features as of last week. New and enhanced features are coming, starting this week, and they will appear on various new plans. For instance, the new Webhooks Control Panel starts on the new “Small Business” plan, and Webhooks Replay starts on the “Small Business +” plan. Higher plans include all features of plans below them. As new features are released, they will be added to whatever plans make sense. For instance, “Small Business” will be the core plan and will have a good package of features, but “Small Business +” will always have a few extras.

* Support: This hasn’t changed… each plan has a certain level of support. The two least expensive plans only have application-level support (“Level 1” support). All other plans have app-level support PLUS access to API/programming-level support (Level 2 support). We prioritize based on your plan level, plus the liklihood that the issue is affecting other merchants, plus the degree to which the issue is stopping you and potentially others from doing business. Thus, the highest priority goes to a bug that causes transactions to fail through one of the popular payment gateways, as it affects many merchants and actually stops their business. Below that severity, we divide up work based on the criteria mentioned. This allows you to pay for more or less attention on support, depending on your needs.

* API Access: This hasn’t changed… all plans have access to our API, but we’re continuing the practice of limiting access to some newer parts of the API. So far, that just means the “Chargify Direct” part of our API… that’s been available on our $99 and higher plans, and will continue to be available on the equivalent new $129 and higher plans. This means that our free and lowest-priced plans have access to almost all of our API, but they do not have API/programming-level tech support. Some merchants use our API docs without any support on our free or least expensive plans, while others start out on our $129 and higher plans so they can get API-level support.

* Webhooks: This hasn’t changed… all plans have still webhooks enabled. What we are doing, however, is adding new features like a Webhooks Control Panel and Webhooks Replay that layer atop the existing webhooks functionality, making it easier and faster to investigate webhook issues (such as re-sending webhooks if the URL you have us send them to was unavailable for awhile). These new tools will only be available on certain plans and above.

Right Around the Corner…
The following new plan attributes probably will not be in place on June 1st, but they’ll be in place reasonably soon thereafter:

* Ramp-Up Fee: Each plan has a “ramp-up” fee that makes business growth smoother: If you exceed the number of paying customers included on your plan, you can stay on the plan and just pay a small amount per customer. You don’t have to bump up to the next plan if all you want is more customers. However, at some point, you will actually pay less if you move to the next plan up. Your plan selection page will show the cost on each plan, given your customer count, and then you can choose based on features and support. Click on the chart graphic above to see details.

* Non-Paying User Fee: Each plan has a 1 cent fee for your non-paying users (free users), BUT each plan also includes a number of them at no cost. Most merchants will not be affected by this because the included number is high enough to cover their needs. Click on the chart graphic above to see details.

Again, all of the above things only apply once you’re on a new plan. For merchants who sign up starting on June 1st, you’ll be on a new plan right away. For merchants who signed up before June 1st, you won’t see these things until July 1st unless you decide to move to your new plan sooner.

LET US KNOW IF YOU NEED HELP OR SPECIAL ATTENTION

We designed these changes to have a relatively uniform impact on all merchants, but there are a few merchants for which these changes will have an unusually large impact. For instance, one merchant on our $99 plan has a very high number of non-paying users, so their bill will increase a lot. We’ll help them export those users and/or give them extra time to ramp up to the new fee structure.

Please let us know if you need something like that.

QUESTIONS OR COMMENTS

I’m happy to discuss this with you, and our support team is always here to help, too.

Thanks.

—- Lance Walley, co-founder/CEO
—- Chargify

—- lwalley@chargify.com
—- Cell: +1 415 244 0349

—- support@chargify.com
—- +1 800 401 2414

Sorry about the slowness and downtime last night and just now for 10 minutes.

We’ve seen network problems inside our data center too many times.

We chose them 2 years ago because they’re a PCI specialist data center. They know a lot about PCI compliance and working with auditing firms, and they provide 24/7 staff working on systems and that we can call on. They are fully-managed hosting, focused on PCI and several other forms of compliance.

But as I mentioned above, data center network problems are hurting us and our merchants. They come in clumps… no problems for a month or two, then problems last night and again just now.

It’s incredibly frustrating to have our systems running fine, but the world can’t reach our app, or they can reach it but only slowly.

A few of you graciously Tweeted with us last night, saying the problem is probably related to IPv6… longer IP addresses that data centers have to upgrade their equipment to support. That’s definitely possible, even probable, but we haven’t been told if that’s the case or not.

We’ve spent a few months researching different data centers, finding out what works for other notable ecommerce companies… what notable data centers / cloud providers they tried that still failed to deliver high uptime. We need to move, but we want to be deliberate about it and learn from the experience of others.

We’ve also been searching for a few months for a full-time systems engineer to focus on this area and make it his or her life.

We were systems engineering -light, but we started changing that earlier this year.

We have a contractor who was recommended by one of you, plus we use bandwidth from our development team. The market for top-notch systems engineers is tight and it takes months to find good candidates and then narrow the list, and of course they have to want us, too.

Thank you to our partners and merchants who’ve sent us leads on potential candidates.

We’re in the later stages of our search and we plan to fill the position soon. We’ll transfer all of the knowledge and contacts we’ve got so far and let this new person run with the project of standing up a new Chargify installation at a new data center.

We’ll keep both data centers and load balance across them.

Another of our large merchants was very giving with their knowledge when we met them earlier this year in Austin. They’ve “been there, done that” with multiple data centers. Another of you also tweeted about similar knowledge last night. Data synchronization becomes the hard part, but it’s a problem that others have tackled before us.

Also note that each installation has to be audited by an outside auditing firm for PCI Level 1 compliance. That adds cost and time, and it’s one of the reasons that we don’t think lightly of moving between data centers / cloud providers.

A related idea we have, but this all costs money, of course, is to stand up *2* new data centers and then have 3 total. That would allow us to monitor them all for, say, 6 months, and then choose the 2 best ones to keep. I really like that idea.

It’s a matter of cost versus risk. Having 2 data centers, even if each of them has occasional short downtime, should result in nearly perfect long-term uptime for our app and for you.

Once you get to 3 or more data centers, then each additional data center delivers a diminishing return in uptime, but there’s no break on the cost… each data center adds linearly to our cost.

Thus, 2 really good data centers located in different geographic areas, using different major internet backbones, should deliver great network uptime and be able to withstand a natural disaster in one place.

Some of you will ask if we’ll just go with multiple AWS regions or something similar from Rackspace, etc. Maybe. Definitely easier to work with one company.

But after some conversations we’ve had recently with some of you, it sounds better to split our infrastructure across 2 or more companies, thereby relying on even fewer common failure points. All of the large data center / cloud providers have had their share of big outages, so we’d feel more comfortable spreading ourselves across at least 2 of them.

So that’s it for now.

We’re aware of the weakness of depending on our 1 data center, and we’re laying the foundation to solve it.

Thanks for being our customers.

—- Lance Walley, co-founder/CEO
—- Chargify

—- lwalley@chargify.com
—- Cell: +1 415 244 0349

—- support@chargify.com
—- +1 800 401 2414

With our new pricing plans, we’re rolling out 3 new tools that make it easier for you to monitor & manage webhooks.

(If you don’t know what webhooks are, then you probably don’t use them and won’t care about these new features ... in a nutshell, webhooks are packets of data that our servers send to your servers whenever something notable happens, like a subscription renewal or cancellation.)

Webhooks are wonderful little things but they can be difficult to monitor and debug. We send them to your servers, and if your servers are ready to receive them, all is good.

But if something goes wrong on either end, it can be difficult to figure out what happened. You have to wait for us to re-try later, or you just update your database to indicate that something indeed did happen if you know that it definitely did (even though the webhook was missed).

1. Webhook Status

Starting on our “Small Business” plan, and assuming you have webhooks enabled in the first place, you’ll see your overall Webhook Status on the right side of your Chargify dashboard, as shown here:

2. Webhooks Control Panel

And if you click View all webhooks, you’ll see the Webhooks Control Panel, on which you can list all webhooks we tried to send to you, and you can filter the list to see, say, only the webhooks we tried to send on June 9th
(click to see larger image):

(click to see larger image):

3. Webhooks Replay

Starting on our “Small Business +” plan, you’ll see the “Resend Selected Webhooks” button on your Webhooks Control Panel. As you might guess, you can select webhooks in the list and then click the button to have us re-send them. This is really useful when debugging, especially if you run a business with many customers and therefore many webhooks being generated every day
(click to see larger image):

(click to see larger image):

We hope you’ll find these new webhook features useful!

Come to Chargicon in Austin, July 30-31.

Learn how Chargify can help manage a big part of your recurring revenue business.

And learn how Shopify and Chargify work together with our new Shopify App!

And, of course, influence the folks working on upcoming features like data visualization.

Register

Register with Twitter - it’s super easy

Format

Chargicon will provide the top things people have been asking for:

• Meet other merchants
Learn how they tackle business challenges - ie, one will demonstrate how they generate metrics on churn & lifetime value.

• Meet the Chargify software dev team
Learn how to use this or that feature or API call, hear about upcoming features, and push for the features you want. Ask us about merchant accounts and payment gateways, etc. Anything & everything.

• Meet Chargify partners and “merchant/partners” (they use Chargify to bill for something cool):
• Shopify (market leader for managing an online store, integrated with Chargify)
• Zferral (affiliate management & payouts, integrated with Chargify)
• Zapier (data sync Chargify signups to MailChimp, Salesforce, & many more)
• Copperegg (server & website monitoring)
• Merchant Focus (convenient source of payment gateway + merchant account)

• Two special topics we’d like to find merchants to discuss/present are:
- How you get Chargify data into your accounting system.
- How you produce metrics like churn and LTV after exporting data from Chargify. We have one merchant who’s agreed to come (on us!), but we still welcome more who can show how they’ve answered this need.

ANALYTICS & VISUALIZATIONS: Some nice folks from Mutually Human in Grand Rapids, Michigan, will be joining us at Chargicon. They’re going to help us create better analytics & visualizations that Chargify merchants need to run their businesses more effectively. Come meet them and discuss your priorities.

Space

We’ve reserved this large room at the W Hotel in Austin. It seats 300 people, which is far more than we expect. But it should work well used the following way:

• Groups of people can break off and do small discussions/presentations. We’ll provide 40-inch TV/LCD displays that anyone can use to display their topic.

• Seating/lounging areas for working on your laptop, chatting with others, eating, etc.

• There will be simple food & drink all day long. Someone said we should have tacos because tacos are popular in Austin.

• At the end of Chargicon, we’ll give away those 40-inch TV/LCDs! We haven’t decided how we’re going to determine who gets them, but we’re definitely not taking them back with us!

Hours

Chargicon hours will be 12pm - 5pm each day.

We realize that most of you have a business to run, just like we do, so mornings are for coffee and work over at Halcyon (1 block away).

Evenings will be whatever we want… we’ll walk to coffee/dinner/drinks nearby and we’d love to have you along.

Need a Room?

If you need a room at the W during your stay in Austin, here’s the link:

Austin W Hotel Reservations

Contact Us

If you have any questions or comments, just let us know:

(800) 401-2414
support@chargify.com

Lance Walley, co-founder/CEO
lwalley@chargify.com

We got blocked by a few other things recently that we had to do first (mainly anti-fraud stuff the last couple of weeks), but they’re finally here!...

Trial Period Ending Options

Now you can set your product trials to end in 1 of 2 ways:

a) With no obligation by the customer when the trial ends,
- OR -
b) With the expectation of payment for the regular product period.

Option (a) is going to be loved by many merchants!

It means when a product’s trial ends (presumably a free trial), we won’t send a statement or try to charge your customer. The trial will just quietly end.

(There is an exception where we will still try to get payment… if there is a card on file, it’s assumed you do want payment.)

Option (b) is the path that’s been there all along.

This path assumes your customer should pay the regular product fee once the trial expires, so we will email them a statement and charge their card and send them into dunning if we can’t collect payment.

New “Trial-Ended” Subscription State

Along with the older subscription states like “Active” and “Trialing”, etc., there is a new “Trial Ended” state. Subscriptions that went through their free trial (with no-obligation trial defined on the product) will end up in this state.

You can then find these subscriptions by using the filter on the Subscriptions tab. You’ll probably want to follow up with marketing to convert these customers to a paid plan, or to get their feedback, etc.

This new state is also available via the API and webhooks, so it’s pretty easy to set up a simple program on your system that responds to any “Trial Ended” state-change webhooks and does whatever marketing you think is best.

Enjoy!

We had to pull some data this week for Visa (for good things!), and it hit us… our merchants are growing nicely!

Look at these top-line stats:

2011
1,079,804 transactions (all types)
$27,900,000 to merchants ($3,184/hr)

2012 (projected)
2,423,982 transactions (all types)
$70,400,000 to merchants ($8,036/hr)

That makes us very happy!

Not because we make any money from their transactions or their revenue (we don’t!!!), but because good news for Chargify merchants is, well, just cool and it’s good news for Chargify.

When everyone (or at least most people) prosper, then everyone benefits. I love to see that.

Our base of merchants is growing nicely year-over-year AND our merchants are growing each of their businesses at an EVEN FASTER rate, which makes us happy to be a part of it.

Congrats, everyone!

Chargify + Shopify = Manage Any Kind of Business!

Shopify is the leading choice to manage your ecommerce store. They’ve been around for many years and they have over 30,000 merchants running on their platform. And if you’re part of the Ruby on Rails community, you know they play a special role.

And, of course, Chargify is the leading choice to manage a recurring revenue business!

Some of you already use both services side by side, so we got together with Shopify to make this even easier.

The new Chargify app in the Shopify App Store gets you up and running quickly. It assumes you already have a Shopify store and you want to add recurring products.

New Chargify/Shopify App does this…

• Provisions a Site in Chargify
• Allows you to create products in Chargify
• Copies those products back to Shopify
• Makes “Signup” buttons appear in your Shopify store for each recurring product
• Manages/bills your recurring product customers in Chargify

Ecosystem will Grow

We know the ecosystem will grow around this, and we know there are a few rough edges to iron out:

• You (the merchant) must use a different email address as your merchant contact info in Shopify and Chargify.
• The app will create a new Site in Chargify, in which you’ll create your new recurring products. There’s no way to utilize products that you already have in an existing Chargify Site.
• When Chargify renews/bills your customers for recurring products, that will not be reflected in Shopify… instead, Chargify will interact with your customer and you’ll know through Chargify via things like our daily summary email, activity feed, BCC emails of statements and receipts, etc.

We’ll improve the integration over time, PLUS we’ve already heard from top Shopify developers who are planning to build atop this.

As the ecosystem grows, Shopify and Chargify merchants will benefit from better and better solutions for almost any kind of business. That’s very exciting!

Watch the following 3-minute screencast. It’s fun, it has good music, and it gives you an overview of the app…

I’ve waited a long time to write this blog post, and I know this will be bittersweet to some because we had to raise prices to get here, but most people we’ve told (merchants and other business owners) see this as a wonderful thing and one of the key reasons they rely on Chargify…

CHARGIFY IS PROFITABLE

Chargify is a great team of 10 people plus some outside help. We started much smaller and grew with the number of merchants we support.

After setting initial pricing much too low and then going through two adjustments since 2010, we got our prices in line with the real costs of supporting 900 businesses.

It feels very good after 3 years to NOT be burning cash each month.

And we still have a nice chunk of Mark Cuban’s investment from last summer. As I said to Mark early this year, “We want to invest that capital, not burn it on operational losses.” To which he replied, “Amen.”

Most people, upon hearing this, give us a high five or say something similar. Most entrepreneurs know that it’s usually a long road from idea to profitability.

But we couldn’t have done it without you, and the journey is still early - we have to maintain and grow Chargify to keep up with the needs of our merchants, affiliates, partners, dev/design shops, and eveyrone else who’s helped us get this far.

So with a small and growing profit, plus some money in the bank, we’re making Chargify better.

PROFIT AFFORDS A BETTER CHARGIFY

• We hired our first full-time systems engineer last month. We jumped the gun on this a little bit, but keeping our systems healthy and growing is one of the most important things we do for you.


• We’re testing data centers to set up our second set of infrastructure. Right now, we run in one data center, and that presents risks. We aim to run two data centers in geographically diverse areas.


• Our second Level 2 tech support person starts in 2 weeks.


• We’ve retained a highly regarded U.S. development firm (Mutually Human) to help us get large features out faster. They kicked off their first project with us at Chargicon, starting with conversations with merchants.


• I’ll start collecting a moderate paycheck. I invested in Chargify when I joined the team in 2009 and I’ve been working for free ever since, but I don’t want to do that forever, and the things I do need to be paid for, whether it’s me doing them or someone else. (For those who care, my deal was: I’ll invest and work for free until we get this thing profitable.)

THANK YOU

Again, thanks to all of our merchants, affiliates, partners, dev/design shops, and eveyrone else who’s helped us get this far.

It’s your monthly payment to Chargify that makes this all possible.

We’ll continue developing Chargify to help you run more and more interesting parts of your business.

Thanks.

—- Lance Walley, co-founder/CEO
—- Chargify
—- lwalley@chargify.com
—- 415-244-0349 cell

A few months ago, Lance posted about our continuing plans to improve the robustness and availability of our architecture.

Step number one in that process was hiring.  I (Drew Blas) have been very pleased to join Chargify and have definitely hit the ground running.  Together, we’ve identified a very aggressive roadmap to turn our service into the most bulletproof site you use.

We’ve already implemented a slew of small internal changes that will help us in many regards.  These represent the ‘low-hanging fruit’ that are the easy and quick actions we could take before beginning our implementation of the number one priority in our life.  We’ve added a lot of additional monitoring, logging, testing, and analytics to help ensure that as we execute major changes we don’t cause any disruption in ongoing operations.  We also hope to bring some of these internal insights to you directly in the form of improved automated status checks & uptime history that will help you to see how well we’re doing.

Our next big hurdle is to actually begin using a second data center.  We’ve talked to a variety of datacenters and providers with a wide range of skillsets and specialities.  We’ve tested, demoed and evaluated their offerings from many different perspectives, including performance, support, & security.

Ultimately, the approach that resonates most with us is the simple philosophy that “manual operations are most prone to cause problems or to fail to respond quickly in an emergency”. Instead, a properly built & tested architecture that can automatically monitor, scale, and heal itself is the ultimate paradigm that ensures our site can keep running no matter what.  This approach demands a highly dynamic and flexible environment with significant automated infrastructure behind it.

Of course, the best known provider of such an environment is Amazon Web Services.  AWS is also a PCI Level 1 Service Provider, meaning they have already completed an audit of the internal & physical security controls that are required in order for us to be confident that our partnership will allow us to continue maintaining our PCI Level 1 compliance.

We have not been exploring these options in a bubble.  We’ve taken input and advice from several experts in the field who have first-hand experience with many different providers.  One in particular that I’d like to point out is Tom Mornini, Co-founder and CTO of Engine Yard.  Several years ago, Engine Yard switched from internally managed hardware in a colo datacenter to hosting their customers on AWS, where they now run many thousands of systems.  In doing so, they saw the reliability and robustness of their customers’ sites skyrocket.  These types of anecdotes have been repeated time and again by many others.

AWS is not without issues.  They have had several high profile outages (indeed, when you host as much of the internet as AWS, any issue is going to be high-profile).  You can be sure that we have studied each one in detail, as well as how others have successfully and unsuccessfully planned for these failures.  At the top of that list is that we’ll be running simultaneously in as many different Availability Zones and Regions as possible.  I, personally, have run several sizable operations on AWS and have found it can be extremely robust when executed properly.  Also, a review of their documentation, technical papers, and architecture descriptions give us cause to be confident that a multi-region failure is no more likely than with any other pair of datacenters we might choose.  We’ll also be using every technology available (both inside and outside AWS) to make Chargify as redundant and highly-available as possible.

Our decision on a new provider is not yet final: we want to get your feedback.  We want to learn how you feel about this process and what we can do in order to ensure you that your data is secure and that the availability and performance of Chargify will only improve.  Please contact us and let us know what think!  It’s important to be clear that our choice for AWS is NOT for ease-of-use, nor is it for price.  Our exploration has focused on security & reliability and in these two areas, AWS is well ahead of its competitors.

Thanks!
- Drew Blas - “Keeper of the Uptime”

We’re always devoting some dev cycles to new features - some little, some big.

Over the past few weeks, we’ve released a few little features that will make your lives better.

And over the past few months, we’ve been working to satisfy another segment of merchants, who need better reporting tools to manage their growth. These are not released, yet, but they are close enough for a peek.

(A note about all images below: you can click to see a larger version.)

Little Features (available now)

• Stripe payment gateway. New merchants have started requesting this at an increasing rate, so we got this added last weekend. Now you can have the convenience of easy credit card processing through Stripe, plus the rich features of Chargify to manage your business.

• Delete subscription, and optionally, a customer and credit card. This has been an annoyance for merchants. No more!

Big Features (available soon)

As merchants grow, some of them want to watch things like churn and lifetime value, so they can make better decisions. We’ve had a small team working on this for several months, and we’re in the final weeks of optimization and bug fixes.

We’ll open this up to a handful of larger merchants first, to make sure the reports yield accurate and expected results, and then grow the group size as we implement feedback.

It’s important that we get these right (and quick in terms of rendering time) before we release them to many users. That’s why we’re approaching this slowly and methodically.

As these new features come out of beta, they will be added to various Chargify price plans. For instance, things like churn and lifetime value will probably be added starting at our $239 or $459 plans, and new revenue reports will probably be added starting at our $129 plan.

Our focus has been on churn and lifetime value, since they’ve been getting the most demand from merchants. Both are right around the corner. Then comes new & improved revenue reporting.

Reporting is an area that will continue to grow indefinitely. In time, some of our smaller segments of merchants will see industry-specific reports.

Today we’re very excited to announce the next step in our datacenter operations expansion.  We’ll be switching primary operations from our current datacenter to the Amazon Web Services cloud in order to allow us to continue to expand our service reliability and capacity.  We have been successfully running AWS as a backup site for two months and are comfortable that we’ve built a resilient new architecture that will allow us to greatly increase our quality of service and reduce outages. 

What to expect

We will be executing this switch on Saturday Dec 1st from 06:00-10:00 EST.  During this window, we expect all of Chargify’s services to CONTINUE TO RUN and are working to reduce any impact on availability to an absolute minimum.  If everything goes as planned, you’ll experience no interruption in service.  However, Chargify has a large number of moving parts, so if we run into any issues, there is the possibility for a small period where the site is unavailable to you.  If this occurs, our aim is to keep this interruption to less than 15 minutes.  We’ll be keeping you updated on the entire process at http://status.chargify.com/ and @chargifystatus

Background processing

In addition to serving web and API requests, Chargify is also constantly running renewals for your customers in the background.  For safety during the switch, these jobs will be paused.  This is a very regular part of our operation: We often pause job processing during any kind of maintenance and we’ve got a battle-tested system for ensuring that nothing is double-billed and nothing is missed.  This switchover will be no different and we expect to resume renewal processing immediately afterward.  This is a well tested process on our end and we’re confident that there is no long-term negative impact on our renewal handling.

The technical details

We’ve developed our new infrastructure to handle simultaneous operation across multiple datacenters.  However, one region must remain the ‘primary’.  The primary region is where our DNS is pointed and all requests to our service begin.  Because the DNS will be changing, you’ll be routed to new IP addresses whenever you make a request to Chargify. 

Our DNS TTL is set at 5 minutes, so for a short period, you may still be routed to the old datacenter.  The old datacenter will CONTINUE TO RUN, and will seamlessly forward your request behind-the-scenes to the new datacenter.  You may experience increased latency as your request bounces from one region to another, but your requests won’t be lost or rejected.

We’ll be operating in all three availability zones in us-west2 (Oregon) region.  Every piece of our infrastructure will be running simultaneously in 2a, 2b, & 2c.  We’ve also done significant testing to ensure we can handle an outage of an entire availability zone.  Finally, we’re also bringing online our THIRD regional backup in us-east1 that will be ready to take over on short notice if there is an extended outage of the entire us-west2 region.

New IP Addresses

Adding a new datacenter also means that the source we use for outgoing payment processing requests and webhooks will be coming from new locations.  We have set up several new IP addresses as potential sources for traffic coming from Chargify.  The latest set of IPs can always be referenced here: http://help.chargify.com/entries/20559136-chargify-ip-addresses  We know six looks like a lot, but that is ONE per datacenter, so six IPs allows us to expand into six more zones without bugging you again.  We’ll be notifying our merchants separately about this change, especially those using QuickPay.

Finally, if you have any questions, comments, or concerns, please don’t hesitate to contact us.  Drew is our migration lead in charge of the switchover and you can reach him directly at drew.blas@chargify.com.

This is a guest post from Jeffrey Vocell at Trendslide
He can reached at jeffrey@trendslide.com

Revenue and new customers are at the heart of your business, and as a result, so are metrics that you want to watch closely. That’s why Trendslide, a mobile business dashboard app, has integrated with Chargify to provide you the ability to keep track of these metrics from anywhere.

We’re a startup in Manchester, NH, that has built a mobile business dashboard app for eCommerce and SaaS companies to easily get key business metrics on the iPhone or iPad.

Our iOS app is free to download and only takes about two minutes to setup, and can get information from Chargify, Shopify, Google Analytics, and much more.

We currently support these Chargify metrics:
New Customers
Total Payment
New Subscriptions.

Here’s how you can get your Chargify metrics within Trendslide app:
1. Download the Trendslide App from the iTunes App Store.
2. Open the app and go to ‘Add Trend’
3. Enter your site subdomain from your Chargify control panel, listed under Sites.
4. Enter your API Key found under the next tab in the control panel, API Access and click Log in.
5. Turn on the metrics you would like to view from your iPhone or iPad!

Once you have added your store, easily share graphs with colleagues and have discussions around metrics rather than waiting for meetings!

Check it out Trendslide on the app store, and let us know what you think. If you have any questions, feel free to email us using the email address at the top of this post.

Here are a few screen shots:

About 7 months ago, we decided that we needed to hire someone to focus on making our infrastructure better.

And we not only needed a better version of what we had, but we also needed to create a better architecture for the future, one in which Chargify and our merchants’ businesses could rely on multiple data centers in geographically diverse locations.

We hired Drew Blas (@drewblas) in July, 2012, and he’s been working on these goals ever since.

With his work and help from much of our tech team, the system has gotten a lot better (faster, more stable) than it was a year ago.

And then a few days ago, we took a big step forward: we moved Chargify to new data centers, and we added the first layer of geographic diversity in a plan that includes more in the coming months.

It’s all part of our long-term plan to support our merchants and their customers with systems that run more efficiently and with less risk from data center problems and natural disasters.

I’m very happy to say that this big Saturday change was very uneventful (which is not an easy task - thanks Drew, Michael, Nathan, Kori, and everyone who was part of it in the wee hours Saturday morning).

Here’s a summary of the past, present, and future:

Phase 0:  2009 to Now

For the past few years, the Chargify app and database have been hosted at a PCI-specialized hosting provider in Kansas City. This system includes multiple web servers, “job” servers (like emails and webhooks), and database servers (master & replica).

This system is still running, but we moved all active processing to new systems on Saturday, December 1st.

Phase 1:  December 1, 2012

The Chargify app and database are now hosted at 2 locations within Amazon’s AWS hosting service.

Each installation of our system includes the same number of web servers and job servers as our Phase 0 system.

Basically, we doubled everything and spread it across 2 locations. This reduces the risk inherent in depending on 1 installation and 1 data center (almost every data center has failures now and then).

More Details:

We’re in 1 AWS “Region” (US-West-2, Oregon)

Within that region, we’re installed in 2 “Availability Zones”, each of which has its own complete Chargify installation, along with completely separate data center facilities (power, cooling, networking, and connection to the world).

These installations may be in the same building or in separate buildings, but even if separate buildings, we believe that Amazon uses locations that are close to each other. We see this as lower risk than where we used to be (in 1 building), but still prone to risk from a natural disaster in the general area.

Regarding our database systems, each new Chargify installation has 1 database server (no replica), but each installation acts as a backup or replica for the other installations. My old friend and Engine Yard co-founder, Tom Mornini (@tmornini) told us about something called Continuent “Tungsten” earlier this year, and it makes a lot of database magic possible. That’s about all I know!

Phase 2:  January, 2013

We’ll add a 3rd Chargify installation in another Availability Zone (still in the same Region as Phase 1). This will be an incremental improvement - better, but still exposed to risk from a large disaster in Amazon’s US-West-2 Region (ie, a widespread and lasting power outage). Certainly unlikely, but not a risk we want to accept for very long.

Phase 3:  February, 2013

We’ll repeat Phases 1 & 2 in another AWS Region (probably US-East-1, Virginia). Then we’ll really feel safe! We’ll have 6 copies of Chargify running: 3 on the US West Coast and 3 on the US East Coast.

Not only will this offer really high redundancy in case of failure or disaster somewhere, but it will also allow us to do more interesting things, like sending web traffic to the closest data center, which should make your and your customers’ experience a little bit better.

We’re pretty excited about this, because even though it’s not visible and perhaps it’s even “boring”, it’s boring like a good water system is boring - boring is good!

And like a water system, this kind of thing is an investment. It’s one of the reasons we raised prices earlier this year.

We’ve released sexier, more visible things recently, and more are in the works, but solid infrastructure is one of the things we think our merchants will really appreciate over the long term.

If you have any questions or you notice something not working right that might be related to our move, please contact our Support team. We definitely want to work out any kinks or bugs that may arise from the move.

Thanks.

—- Lance Walley, co-founder/CEO
—- lwalley@chargify.com

We’ve been growing our infrastructure (see this post) and our team (just hired another developer this week!) and today we’re happy to release one of the big things our merchants have been asking for to more easily manage their businesses.

Customer Invoicing

Now you can use Chargify to manage your customers who want to receive an invoice and then pay you by sending a check, a wire transfer, or a bag of gold!

Until now, we’ve been all about managing your business and your customers who pay by credit card.

But over time, a lot of our merchants end up needing to bill some customers by credit card and other customers by invoicing them.

They need to send an invoice to their customer, then collect payment outside of Chargify (usually a check in the mail), and then record that payment in Chargify (which can be a full payment or a partial payment, or sometimes the freedom to just discard an invoice without payment, usually due to some discussion with their customer).

Manage your recurring credit card and invoiced customers in one place!

Invoiced Customers are Usually Larger Customers

As Chargify merchants grow, especially the B2B ones, some find that 75% of their customers pay with credit cards, yet 75% of their revenue comes from their invoiced customers. I asked one merchant what his average credit card customer pays and what his average invoiced customer pays.

His answer: $100 (credit card) and $5,000 (invoiced).

He really wanted to manage both sets of customers in Chargify, and now he can.

Example Merchant

Let’s imagine a merchant that offers an online system to help medical offices manage their patients.

They start out reaching small medical offices that are willing to try something new. Those customers are happy to pay with a credit card. Let’s say the average monthly charge is $200 (base fee plus some per-user fees).

As the merchant grows, they start selling to chains of medical offices and eventually to small hospital groups. They start running into customers who want to pay monthly or quarterly and those customers want to receive an invoice and then send payment by check or wire transfer after 30, 45, or 60 days.

More Reasons for Invoicing

And there’s a reason the merchant likes this, too: those hospital groups are paying $5,000/mo for the merchant’s wonderful software. Our merchant can keep a lot more money by receiving a check or other form of payment from a trusted customer. Although a credit card means faster funds, it also means losing roughly $200 on that sale every month. If you trust your customer to pay, and you can wait 30-60 days to get paid, that adds up to more money in your pocket over the year.

And one last thing is the issue of certain larger customers not accepting credit card purchases above some limit, say $1,999, and wanting such purchases to go through their accounts payable process if you want their business. You won’t lose their business over this - you’ll find a way to send them invoices if that’s what they require! But now it’s far easier because Chargify manages both types of customers.

Invoicing is available on our "Growing Business" plan

Invoicing is available on our $459 "Growing Business" and higher plans.

But like all of our features, it’s also available on our $0 "Developer" plan so people can see it before they buy.  (And, of course, we have a 30-day money-back guarantee, so you can even get your money back if you try it and don’t like it.)

Please let us know if you have any questions, and definitely let our Support folks know if you encounter any problems.  This is a big feature that touches many parts of our app - we’ve tried to test for just about everything, but we may have missed something.

More Info / Documentation

Here’s the documentation for Invoicing.

Happy (billing) trails