Ask YC: Recurring billing: 1. Paying resellers, 2. Switching gateway vendors

[cattledogit]

SaaS Rails Kit (http://railskits.com/saas/) with Active Merchant used with gateways such as Braintree or Authorize.net seems like a flexible and cost-effective option for recurring billing. PayPal looks like a fast way to get started, bearing in mind the horror stories (http://news.ycombinator.com/item?id=198516 ).<p>Two questions:<p>1. What solutions are available to automate tracking, reporting and payments to channel partners (resellers, distributors, affiliates) using the gateways or PayPal? I’ve heard that Avantgate (http://www.avangate.com) supports multiple tiers of distribution, but their fees (http://www.avangate.com/help/vendor-faq.php#bottom10) are higher than the gateways, and only the name "Avangate" appears on the buyer’s CC statement. PayPal enables payments to affiliates using simple scripts with PayPal’s Mass Pay, but you have to create your own reporting. Amazon FPS appears to only support per-transaction payments, not aggregation of payments (http://tinyurl.com/l6zvkd).<p>2. How easy is it to switch gateway or platform vendors if they’re storing the credit card info? If you’re using Auth.net but want to switch to Braintree, how is the credit card info transferred so that you can continue billing monthly without interruption? This question has been asked before (http://tinyurl.com/mj9zgp) but not answered that I’ve seen, except that CC info can’t be transferred from PayPal (http://tinyurl.com/lyupgg).<p>Thanks!

[cattledogit]

Resubmitting, hopefully replacing the <p>'s:

SaaS Rails Kit (http://railskits.com/saas/) with Active Merchant used with gateways such as Braintree or Authorize.net seems like a flexible and cost-effective option for recurring billing. PayPal looks like a fast way to get started, bearing in mind the horror stories (http://news.ycombinator.com/item?id=198516 ).

Two questions:

1. What solutions are available to automate tracking, reporting and payments to channel partners (resellers, distributors, affiliates) using the gateways or PayPal? I’ve heard that Avantgate (http://www.avangate.com) supports multiple tiers of distribution, but their fees (http://www.avangate.com/help/vendor-faq.php#bottom10) are higher than the gateways, and only the name "Avangate" appears on the buyer’s CC statement. PayPal enables payments to affiliates using simple scripts with PayPal’s Mass Pay, but you have to create your own reporting. Amazon FPS appears to only support per-transaction payments, not aggregation of payments (http://tinyurl.com/l6zvkd).

2. How easy is it to switch gateway or platform vendors if they’re storing the credit card info? If you’re using Auth.net but want to switch to Braintree, how is the credit card info transferred so that you can continue billing monthly without interruption? This question has been asked before (http://tinyurl.com/mj9zgp) but not answered that I’ve seen, except that CC info can’t be transferred from PayPal (http://tinyurl.com/lyupgg).

Thanks!

[stympy]

I recently added affiliate tracking to the SaaS Rails Kit as a starting point for tracking payments to affiliates, etc. It's not a full, automated solution of course, but at least you can track it.

Generally you can't get that stored card data back out of the gateway. You basically have three options for this: 1. Just stick with the one you pick for the life of the app. This is the easiest. :) 2. When you switch keep track of which gateway has the info, maintaining two gateway accounts. 3. Ask users to re-enter their billing info when you switch.

[cattledogit]

Following up on question 2 re switching gateways, I've been told by Braintree, TrustCommerce, and Plimus that they will export credit card data to another vendor for a fee. Of course you should confirm this with them yourself before relying on the info. Some others I contacted won't export, or can't because they don't retain the card data.

[cristianbadea]

Hi,

Avangate has two main platforms: Avangate eCommerce and ARMS. If you are looking for a system to manage channel partners, invoicing, payments and reports you might find a solution in ARMS (Avangate Reseller Management System - http://www.avangate.com/reseller-management-software/). The pricing is different than the eCommerce platform (the link you've sent) and can be either a license cost if the payments are processed by your own payment system or a variable pricing scheme if the Avangate payment system is used.

In terms of what appears on the customer credit card, it's not just the string "Avangate" that will show on the statement, but also your website. Something like "avangate.com/ycombinator.com".

Hope my info helps.

-- Cristian BADEA | Avangate CIO cristian.badea at avangate.com Tel: [phone] | Fax: [phone] http://www.avangate.com

[jacquesm]

The best way to do this is to get a merchant account of your own and plug in with any one of the big IPSPs. Integration is typically less than half a days work.

PayPal is notoriously bad about charging recurring for services, I would never use them again for something like that (they once held a substantial amount of money for 6 months without any qualifications, just 'account closed' and 'because we can').

[spooneybarger]

if someone is storing the data for you, you are pretty much locked in. spending the extra time and managing the data yourself is probably a really good idea.

[aneesh]

That's true for everything except credit card data. If you have to ask, storing users' credit card data is almost always a bad idea. The information is very sensitive, and any compromise is very serious. That's why if you store payment information, you generally have to implement a number of best practices to achieve "PCI compliance". This costs you time & money, as well as additional policies and regulations at your company. Unless your revenue is reasonably significant (say, over a million per year), it's probably not worth the hassle. Outsource your payment processing.