[darylteo]

Selling to developers is where i know it will struggle... Developers are cheap ass and would rather build it themselves at 10x the opportunity cost. And the moment it attempts to monetise itself in some form, there'll be a massive "betrayal" exodus a la Redis.

I know, cuz I am one.

[lucw]

Usage based billing is tough. I took a long hard look at lago and ultimately it wasn't for me (B2C API based business). I couldn't do without the customer portal which is a premium feature, and premium was at least $1,500 USD/month. My revenue couldn't justify this. To Lago's credit, they are purposefully staying away from percentage pricing. So they have to charge a lot on the base price. Stripe Billing charges a percentage and guess what, with a growing business it's only a matter of time before your Stripe bill tops that $1.5k.

I also looked at Stripe Billing for usage-based and it didn't meet my requirements either. (though I am using Stripe Billing with flat charges).

My exact use case is:

- I want to sell API credits upfront including for subscriptions (i.e. user signs up for $10/month of credits, they pay $10 upfront, and can spend $10 worth of credits). Stripe billing doesn't support charging upfront, for usage-based, they only bill after the billing period is finished. Some of my users have been gaming the system, canceling and not paying so that doesn't work for me. I believe Lago did support billing upfront.

- I want to freely mix subscription based and pre-paid credits. My users go over their quota one month, they don't want to upgrade their subscription to the highest tier, they prefer a one-off top-up. I need to control over which credit gets consumed first. Stripe billing and Lago both had issues with this, I can't remember exactly what.

- I wanted to support as many payment methods as possible, and particularly Chinese wallets for pre-paid credits (Alipay, Wechat). Lago has no plans to implement this, I was half considering implementing it myself inside Lago. I don't think Wechat and Alipay will matter much for B2B businesses.

- I'm also a huge fan of massively regression tested code, and Stripe Billing with its test clocks blows Lago out of the water here. Lago has no ability to walk the clock forward for subscription lifecycle testing. Though maybe this matters less if you have faith in the product, you can just expect to get the right callbacks on time.

I did notice that the Lago devs on slack took time to answer questions down to the deepest technical level. If I was running a B2B startup, I would probably try really hard to fit Lago in the picture, particularly at at time when stories of Stripe account bans are so prominent.

[bcaxis]

I do something similar with stripe. I add two items to the subscription. A base unit that charges a fixed price up front and monthly thereafter. And usage based second item that bills based on usage minus the pre charged items. Usage based fires for the first time on their second charge.

If the user cancels their subscription, I run it through the next payment period for their usage based billing period and then cancel it.

[Rafsark]

What's a fair price for a budget-friendly hosted version? Lower upfront cost, or maybe a revenue share? We've aimed at enterprise deals for the paid edition, keeping the open-source version widely accessible. Keen to hear your thoughts on adjusting our pricing.

[bcaxis]

I do something similar with stripe. I add two items to the subscription. A base unit that charges a fixed price up front and monthly thereafter. And usage based second item that bills based on usage minus the pre charged items.

[nprateem]

Did you find a good solution for this?

[n2d4]

Typical mind fallacy. I personally love paying for things that save me time, and I'm also a developer.

Also, this is kind of their thesis, isn't it? That developers want open-source software to do their billing, which they can modify themselves if they need certain features instead of relying on a proprietary provider like Stripe. Doesn't sound too outlandish to me.

[hitekker]

Nah, I'm developer and also I don't like paying for things.

If anything, the mind fallacy isn't the GP but on the commenters pretending that they love losing money. If we could pay $0 and get everything we want, we would. Everything else is just performative commenting to save face.

[n2d4]

"Typical mind fallacy" = the (subsconscious) assumption that everyone thinks the same way. All I'm saying is that different people have different thresholds for when they buy stuff, even among developers; the best evidence is exactly those commenters you mention who are more willing to spend than you are. (And that's fine!)

[colesantiago]

Everyone uses stripe though which is already 10000x easier than anything out there.

The fact that even Amazon has switched to Stripe shows this.

And that is not even getting into the PCI, PCI DSS, SOC, I and II, etc compliance soup of self hosting.

[chucke]

For payments, not for billing, right? I'd be very surprised otherwise, considering how Stripe's offer for billing is quite inflexible and (at least 6 months ago) offering experimental features.

[simfree]

Stripe is only used for edge cases in Amazon's payment flow, and Amazon tracks how much of its payment flow and what the cost differential between them processing with their direct relationships would be versus Stripe's markup.

Basically, here are the worst of the worst of Amazon's transactions, please take this risk onto Stripe's platform, then we will cut cost with full knowledge of exactly how much we will save by spending developer resources to cut out Stripe for this particular card type in this particular country.

I would not call this a healthy relationship, but rather stripe taking the marginal additional volume that Amazon brings to their platform to net slightly more money and get slightly more data points on weird payment methods.

[Rafsark]

But Amazon uses a custom homegrown usage based billing, not relying on Stripe Billing. This is why Lago exists, to offer a flexible usage-based billing architecture for companies offering usage based or hybrid billing without having to build everything on their own.

[aerhardt]

I am not a cheap-ass developer. I believe that thinking economically is a fundamental facet of engineering, and if you are not thinking economically, you may be doing something, but it’s not engineering. Like the sibling commenter, I am delighted to pay for something that brings value and saves time. Not like I ever considered building my own billing system, anyway…

[baxtr]

They probably didn’t get the level of funding if they haven’t already solved this.

[IshKebab]

Nah there are tons of startups with funding and only vague plans for actually making money.

[pooper]

I don't know anything about funding but most of the funding came in the before times, when we had a zero interest rate policy, right? In post zirp, would even Y Combinator darling Dropbox or Airbnb be able to secure funding (without a solid plan)?

[AnhTho_FR]

We raised the biggest chunk of the money in 2023, which was far from being « zero interest rate », and « founder friendly », or even « fintech friendly ». What is true is we raised the initial $3M in 2021, out of YC, on the back of our initial product that was not open source.

[that_guy_iain]

Developers aren’t that cheap. Plus they’re not the decision makers.