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Chargify New Pricing

133 points by MicahWedemeyer 16y ago

MicahWedemeyer 16y ago
This spooks me a bit. I'm a big fan of Chargify, but for their prices to jump like this and totally remove the free plan is scary. That will make it much less attractive to brand new web apps that don't have a proven business model. With the new pricing scheme your setup cost for accepting credit cards are merchant account, gateway (ie. Authorize.net), and $99/mo for Chargify. For most brand new web apps that's going to be significantly more than you pay for server/hosting costs. That's a bitter pill to swallow when you're not even sure if anyone will actually pay for your service.
- nlco 16y ago
  I agree, I'm working on a SaaS that is hopefully going to be deployed in a month where I was planning to use Chargify, but the $99/month seems hard to justify when I can just use paypal.
- sv123 16y ago
  this is disappointing. we were looking forward to starting to use chargify because of the free tier. Now I would be reluctant to even sign up until I was sure I had at least a few paying customers. I don't remember exactly but the free tier seemed pretty generous, maybe cutting that down to under 5-10 customers is free? To at least get people hooked on it without such a big barrier to entry.
  - owkaye 16y ago
    Even giving me 5 customers free would encourage me to try them, but they can forget that now -- because I'm not going to commit to anything close to $99 a month unless I actually have hundreds of paying customers. Just my personal point of view, but it feels like they have so much business now that they no longer care about getting any new customers.
symkat 16y ago
Your pricing page does not look right in Chrome 6.0.472.63 on Mac (latest current). Screen cap: http://i.imgur.com/ffxIy.png http://i.imgur.com/ffxIy.png As someone who will be looking for this type of service in the near future, I agree with Michah that the pricing for a start up, especially one that's bootstrapping is not attractive at all. At this pricing it makes more sense to build my billing system and use Authorize.net.
thetrumanshow 16y ago
Spreedly: $20/month + $0.20 per transaction. .. and I'm using it on 2 apps. I was considering trying out Chargify, but not anymore. Unlike Spreedly, Chargify apparently wants me to pay a lot more up front for users I don't even have yet.
- symkat 16y ago
  Thanks, I've never heard of them!
petercooper 16y ago
It's not quite apples to apples but Recurly is similiar and is $29/mo for 500 users and under. They have some great Ruby integration demos too :-)
youmon 16y ago
Chargify can charge what it wants, but the pricing change was abrupt and BIG. Apps on the ground floor went from FREE to $1200/year. No grandfathering, 30 days to accept. For a service that needs to be integrated, that's a terrible move that shows no respect for startups.
- wheels 16y ago
  What's worse is that if you're already using them, you basically have no choice in the matter since the alternative is trying to get all of your customers to sign up again, which is basically a non-starter. Note that they also doubled prices for their first tier of paid customers from $600 to $1200.
  - MicahWedemeyer 16y ago
    Well, technically you have all the customer data in your gateway's info manager (like Authorize.net's CIM), but it would still be a real bitch to take that and do anything useful with it. Plus, the clock is ticking on your 30 days to get it migrated to your new setup.
    - jacquesm 16y ago
      CC, EXP and CVC as well ? Without those you won't be doing much in terms of migration. Other than contacting the customer, figure you'll lose 75% or more of your business that way.
      - MicahWedemeyer 16y ago
        In our case, all that stuff is handled via the Authorize.net CIM. Chargify stores everything in the CIM and just makes calls to Authorize's API. To be clear: we can leave Chargify, but Authorize has us locked in.
        jacquesm 16y ago
        What does chargify do for you that the authorize.net api can not do for you?
amccloud 16y ago
They need to include 50-100 customers for the free developer plan. If I was bootstrapping a service, I wouldn't pay $99 a month for customers I don't have yet.
mthomas 16y ago
Chargify requires that you setup both a payment gateway and a merchant account. Why would you use them instead of just integrating with the gateway directly?
- MicahWedemeyer 16y ago
  Chargify handles a lot of the recurring aspect, dealing with expired cards, notifying you if someone doesn't pay, etc, etc I talk a little about it here: http://peachshake.com/2010/06/15/saas-subscription-billing-or-how-to-avoid-getting-your-nts-in-a-vice/ http://peachshake.com/2010/06/15/saas-subscription-billing-o... It was a great deal for the price, but now...not so much.
  - rwhitman 16y ago
    Your post did a good job of pitching chargify, I was passing it around the other day for justification to go with them. Such a bummer that they pulled this
matt1 16y ago
I've been slowly integrating Chargify into my app for the last several weeks and was blown away to read about this just now. One of the big selling points for me was the fact that it was free for up to 50 customers. I thought this was brilliant on their part because neither Recurly or Spreedly offer this. It got you locked into using their service, which is huge. That being said, I bet that 95% of their users are under the 50 users/month threshold and it must cost a bit to support them all. They must have calculated that it just wasn't worth it. I wish they would offer a cheaper plan for up to, say, 100 users. I think that would a great middle ground for new apps. I wrote a blog post a few weeks ago comparing the costs of Recurly, Spreedly, and Chargify and concluded Chargify was way in front [1]. I think they're way behind now. [1] http://www.mattmazur.com/2010/08/comparing-recurly-spreedly-and-chargify/ http://www.mattmazur.com/2010/08/comparing-recurly-spreedly-...
- MicahWedemeyer 16y ago
  This seems like a big shoot-self-in-foot moment. To get to 50+ users you have to start at zero. Cut out all your <50 customers and you'll never have any >50 customers. Seems blatantly obvious to me. I guess I must be missing something.
  - alextgordon 16y ago
    I don't know why they don't just charge a set monthly amount for each user (up to a threshold). Say $1. So if you have 20 users you pay $20/month. That would allow them to keep their existing customers, cover their costs and provide a path for people to work up to $99/month. Also, they shouldn't have doubled their fees for existing paying customers.
    - 3pt14159 16y ago
      I empathize with you're sentiments, but I ran a split test for a SaaS based business and it turns out "packages" convert better, at least for their target market (law firms). It would be nice if everything was just a continuous curve, but people are more sold on "plans".
edanm 16y ago
I'm not sure I understand - what does the free developer option give you? Just the ability to integrate with your site (but not actually charge anyone)?
- matt1 16y ago
  Until today they offered a plan that let you use their service for free until you reached 50 customers. Now there's no free plan that you can use after you've launched your site. And for existing apps that use Chargify and have less than 50 customers, they're going to have to start paying $99/month to keep using the service. Edit: I understand your question now. Yes, the current free plan lets you integrate it into your site, but you can't actually start charging customers until you upgrade to the $99/mo plan.
  - speric 16y ago
    I am that boat (existing app that uses Chargify, with < 50 customers). Sucks.
speric 16y ago
We have about 35 customers in Chargify, and growing steadily, but $99/month will eat almost half our monthly revenue. Really disappointed.
- owkaye 16y ago
  You should get out NOW so you can settle on a different company's services -- one that treats its customers better.
  - speric 16y ago
    They've indicated that alternative arrangements can be made with existing merchants (not free, but not $99 either). We'll wait to see what those are before making a decision.
- traskjd 16y ago
  Really? Almost half your revenue is $99 off 35 customers? You charge your customers marginally more than $2.80 a month? Maybe I'm misunderstanding something here with the pricing, but this sounds more like you're getting hurt because you're trying to take micro payments which typically isn't a solved problem (yet).
  - speric 16y ago
    >>Really? Almost half your revenue is $99 off 35 customers? Not sure how you got that. I'm not taking micropayments via Chargify. I don't think you understood me.
  - speric 16y ago
    http://www.talentsoup.com/forum/topic/1023 http://www.talentsoup.com/forum/topic/1023
railsjedi 16y ago
That's a pretty huge price increase. With all the competition in this space (Recurly, CheddarGetter, Spreedly, many others), I would assume the prices would be going down, not skyrocketing up. They obviously are banking on the fact that their customers are already tied up with their API, so it would be difficult to switch. This is pretty sketchy, and it's going to make me very suspicious of these guys in the future. Also.. no grandfathering clause for existing paid clients?
- heimidal 16y ago
  I don't think you can expect these services to lower pricing any time soon. Why? It's clear now that Chargify and Recurly, who have both tried a very friendly freemium model, vastly underestimated the costs and problems associated with the businesses they are building. In both cases, it's a good bet that they needed to either raise prices or go out of business. Pricing only goes down once the business model is clearly established across multiple competitors. This space simply isn't clearly defined yet.
jacquesm 16y ago
> we do need to migrate everyone to the new pricing You can't change your pricing upwards for existing customers, ever. You can change your price to anything you want for new customers. You can decrease your prices for anybody at any point in time. Something like chargify is the basis for the business models of other parties, if you made a deal in the past you have to honor it, so that your customers can honor the deals that they made.
- rgrieselhuber 16y ago
  Agreed on pricing upwards for existing customers. Why would you ever punish your earliest customers for taking a risk on you? > You can decrease your prices for anybody at any point in time. I've heard this can actually be quite tricky as it makes your existing customers feel like they've been suckered.
  - jacquesm 16y ago
    > I've heard this can actually be quite tricky as it makes your existing customers feel like they've been suckered. Not if you do it all across the board, and preferably gradually.
- davidu 16y ago
  Agreed. First, it's crazy that Chargify is not talking about this here and responding. (Update: they are responding quickly via Twitter) Second, when will companies understand and learn that you simply CAN NOT do this. Hell, how can any board member let a company do this? We just started looking at Chargify for all OpenDNS enterprise users (doing many $mm/year in transactions) but we thought their pricing might not scale up for us. So we had it on hold. The distinction between free and paid customers was critical for us. Now I know I was right not to pursue it. We'll continue with our home-built solution.
  - deleted 16y ago
    [deleted]
  - jackowayed 16y ago
endlessvoid94 16y ago
Wow. I'm about to launch a pretty involved startup, and we're bootstrapping. Chargify, you just DOUBLED our monthly expenses. Thanks a lot.
davidedicillo 16y ago
I found out about the change of pricing friday and I was really bummed about it. 50 free users were the perfect amount of user to guarantee some steady income before tackling the expense. It's also true that with a $25/mo you would need 7 clients to at least cover the billing costs (chargify/gateway/merchant acc.). Maybe instead they could have just change the free plan to 10 customers + no support. I looked at Spreedly, I loved their simplicity, but at the same time I feel they are missing some important features like discount and coupons management.
MJR 16y ago
It seems very clear that the free pricing was a great incentive for customers to sign up, allowing Chargify to get their business off the ground. Now that their business is running and they have paying customers, they have little need for keeping the free accounts and helping other businesses get off the ground. In my opinion, a really poor move and completely opposite of the mindset and spirit of their initial offering.
podman 16y ago
This was very disappointing to read. If their product were rock solid I wouldn't have minded as much but it's far from being a complete solution. Unfortunately, a lot of chargify needs a lot of work. I'm especially unhappy with the metered components as they enforce integer cent prices for the components and only allow integer usages on those components. It's impossible to charge fractional usages. I guess it's time to start writing my own billing system.
- jon_dahl 16y ago
  Agreed on the metered components. Chargify's metered billing system is not ready for primetime. I love the idea of a subscription management services, but this is still a very young space, unfortunately.
workhorse 16y ago
Moral of the story is, it is OK to offer a free plan to gain traction, and then remove it once you have it. This decision worries me on so many levels. I am so glad I went with Braintree Payment Solutions instead of Chargify. Chalk up another victory for my gut instinct paying off!
- pjscott 16y ago
  I think the real moral of the story is that it's not okay to offer a free plan and then suddenly remove it and jack everybody's prices up. Your customers will feel betrayed, and it'll be a PR disaster. I'm not sure if people will ever trust Chargify again.
nezumi 16y ago
I was seriously considering Chargify, but now... I just hope they take a leaf out of GitHub's book - remember this? http://github.com/blog/675-organizations-for-small-businesses http://github.com/blog/675-organizations-for-small-businesse...
steveaz98 16y ago
We just launched globalfolders.com using Chargify (on a very slim budget), thinking we could justify their costs once we graduated to a larger plan. This change erases that idea. It hurts more than just Chargify and their customers, it hurts anyone running such a service as people will be more likely to avoid services that they can't trust to keep their pricing stable (or at least give plenty of advance notice, 6 months to a year). These kind of changes definitely make me think much harder about outsourcing a service. How can we trust the current pricing? Do we have to change our pricing every time they change theirs? How many customers do we lose based on their bad business decisions? Chargify knows that people have spent time integrating with their service. They hope that this will give them a percentage of paying customers, knowing full well that they will lose a lot of customers. This is definitely a bad move for Chargify and a good decision for their competitors.
teye 16y ago
I find the new pricing chart to be misleading. By listing the free account next to their customer-enabled plans, at first glance I expect it to allow me to serve customers. http://chargify.com/pricing-and-signup/ http://chargify.com/pricing-and-signup/ Took me a minute to realize I get nothing (except the ability to integrate... SCORE!) by signing up. Smart to drive signups this way, but I think expectations are being set incorrectly.
bobx11 16y ago
I spent the last two days porting our code from paypal web payments pro over to chargify... and then they just jacked up their prices for starter level from 0 to $1,200 a year, and you still have to subscribe to authorize and the customer information manager - so they're just providing the gateway for $100/month. Ruined my afternoon, and probably tomorrow as I look at the other options like recurly.com , spreedly.com , cheddargetter.com , etc.
- carbocation 16y ago
  If you want to waste a bit more time, it would be great if you would take notes and submit a blog post to HN with what you find.
davidedicillo 16y ago
Some Chargify alternatives: http://cheddargetter.com http://cheddargetter.com http://www.spreedly.com http://www.spreedly.com http://recurly.com http://recurly.com http://www.braintreepaymentsolutions.com http://www.braintreepaymentsolutions.com
- cglee 16y ago
  Just a note that Recurly did this exact same thing several months ago, though they've since changed their prices again. We were literally 1 day away from launching on Recurly when they changed prices. Spooked by the sudden price hike, we spent a good deal of time re-writing our ecommerce on Chargify. And now this. Maybe it's time to just bite the bullet and roll our own solution. Spreedly doesn't provide the same functionality, but it's great if you just need a basic recurring payment solution without the frills or deep API integration. I haven't worked with CheddarGetter or BrainTree directly.
  - jacquesm 16y ago
    If you can at all afford it get your own merchant account and work with an IPSP directly, keep control of your own data as much as is allowed and make a deal that if they go belly up that you will get access to your accounts for a one-time migration to another IPSP. Otherwise you're just setting yourself up for big trouble down the road. Middlemen in the payment business have a habit of going down when you need them most (when your business is successful and you are growing like mad, have a bunch of employees and suddenly your income evaporates). iBill, DMR, now Jettis in trouble and many others besides. All it takes is one big VISA fine for not following procedures and these operations will fold like a house of cards.
    - boundlessdreamz 16y ago
      braintree looks like the best option then. They are PCI Level 1 compliant and they are too big to go belly up and they have a great reputation.
  - steveklabnik 16y ago
apowell 16y ago
I was piloting Chargify with about dozen customers to see if I wanted to make it the default platform for all of my customers. Now, definitely not. This bait and switch shows a complete lack of respect for everyone who has invested in the platform. Chargify, I'm sure you'll be laughing all the way to the bank, but not with my money. Does anyone sell an installable non-SaaS replacement for Chargify that integrates with Authorize.net CIM?
schammy 16y ago
Did they learn nothing from the Recurly debacle a few months back? I don't think their pricing is bad but they need a starter plan that's less than $99/month. Also, why are both Chargify and Recurly doing "bucket" plans with such high starting price points? Why not charge based on actual usage? If you have 500 paying customers you can justify $99/month no problem, but most people are going to take a while to build up to that size of customer base. These people can't start off with a $99/month plan. At least give maybe the first 10 customers for free, or charge on actual usage, e.g. $X per 10 customers or something like that. One thing's clear at least, if I ever go into the recurring payment business, Chargify and Recurly are both very good examples of what NOT to do to win customer loyalty.
- gdevore 16y ago
  The problem with charging for actual usage is that most of Chargify's support costs are probably incurred while their customers are setting things up. And that is when they don't have any users. Once you get chargify set up you don't have to touch it too much. Regardless though, this was a bad way to handle the price increase.
  - run4yourlives 16y ago
    Are you suggesting that basic customer lifecycle management is an issue for them? That's not exactly reassuring. When you determine pricing, you figure this out. Every business has customer acquisition costs.
matt1 16y ago
Update on the Chargify support forum: We appreciate the feedback and will make something available to anyone that built their business around this. It will not be free but we will give a large discount for a smaller plan. More information to come shortly. http://support.chargify.com/discussions/support/3987-new-price-plans-very-concerned-feedback http://support.chargify.com/discussions/support/3987-new-pri... I wonder how it will work for someone like myself, who has spent a month integrating Chargify into my app but who hasn't launched yet. Discounted plan or $99/month?
markbao 16y ago
Wow, really? Chargify just lost its position as the best choice for subscription management. Extremely glad we didn't launch yet with Chargify... Here are some Chargify alternatives that we are looking at: Recurly, http://recurly.com/pricing/ http://recurly.com/pricing/ at 200 transactions and 500 users $29/m - Spreedly, http://spreedly.com/info/pricing/ http://spreedly.com/info/pricing/ at $19/m + $0.20/transaction or 2% per transaction if less - CheddarGetter, https://cheddargetter.com/pricing https://cheddargetter.com/pricing at $39/m -> 1000 customers, $0 per transaction. At the moment, we're probably going to switch to Spreedly, since the rates look good and they've been around for a while. Depends on what kind of dunning management they have. Correct me if I'm wrong, but it's pretty ironic that it was part of the lean startup bundle.
- cglee 16y ago
  Last time I looked, Spreedly's API and functionality wasn't even in the same ballpark as Chargify's. I've worked on integration projects with both, and Chargify is much better and more configurable. Spreedly may have improved, it's been a while.
  - markbao 16y ago
    That is what I found when I last looked at Spreedly as well. Good opportunity for them to beef up their API to attract defectors.
  - ntalbott 16y ago
    On the one hand, I agree with you - Spreedly's not as feature rich as some of the competition. On the other hand, we have a lot of very happy customers, so that doesn't mean we're not a good fit for a significant set of startups.
    - cglee 16y ago
      Very true, please count me as one of your satisfied customers. In a different comment, I did say Spreedly would be a great fit for those who just want a straight forward recurring billing solution, without deep API integration and other features offered by Chargify/Recurly. I forgot to note that here.
rwhitman 16y ago
Wow thats a real bummer, I was about to integrate it into an app, but I certainly don't want to blow $99/mo on something that may or may not earn me a small fraction of that Has anyone used Spreedly or CheddarGetter etc? Thoughts? Are there any robust open source self-hosted solutions? (For Django, Rails, PHP?) Considering its just a subscription management wrapper for Authorize.net, shouldn't be too hard to cut out the middleman
- stympy 16y ago
  Yes, self-hosted Rails solution here: http://railskits.com/saas http://railskits.com/saas Shameless self-promotion, yes, but it's actually relevant. :)
davidedicillo 16y ago
From their support site: All, We appreciate the feedback and will make something available to anyone that built their business around this. It will not be free but we will give a large discount for a smaller plan. More information to come shortly.
proee 16y ago
Bypass the SAAS model altogether and check out http://www.opengateway.net http://www.opengateway.net One-time fee for the script and you get all the power of chargify on your own host.
- carbocation 16y ago
  Am not well versed in this, but wouldn't the onus be on you to be PCI compliant then?
  - proee 16y ago
    it depends on your sales volume. If you're a small starup you can do self-certification. Once your volume picks up you can go to the next step.
  - brockf 16y ago
    If you have a hosted order form with Chargify, there's no difference between OpenGateway and Chargify when it comes to PCI compliance. VISA and MasterCard say you should be PCI compliant either way. Also, OpenGateway doesn't store credit card information which is always good.
- moe 16y ago
  This looks too good to be true. Where's the catch?
matt1 16y ago
Question, since this is getting a lot of discussion right now and it's relevant for anyone this impacts: If you run a subscription-based web app and you determine that you need to increase your prices, what's the best way to do it? Grandfathering existing customers obviously makes sense, but what if that's not an option? What if you need to charge them more to survive?
- Goosey 16y ago
  Make the old customers part of a 'legacy' tier which allows them to continue to pay the same and receive the same, but don't allow new customers to join that. Put new customers in the 'fancy shmancy' tier and allow old customers to migrate there (with price increase) for whatever new features you are adding. It's still going to be a bitter pill for the old customers, but it IS better than saying "Sorry, you gotsa pay more now! Suckers!"
adamhowell 16y ago
I feel like I'm missing something, because going by these pricing charts -- http://chargify.com/pricing-and-signup http://chargify.com/pricing-and-signup -- it seems like if you're a Chargify customer, "freemium" is no longer possible. We (http://mocksup.com http://mocksup.com) happily use Spreedly and only send customers to them when they're upgrading to a paid account. Can you not do this with Chargify? And if you can, what do they count as a "free" user?
- toast76 16y ago
  At UsabilityHub we (fortunately) circumvented their "free" user count by never sending them to Chargify in the first place. If we did, we'd be now getting billed $1000 a month. We did this because when we switch to chargify a couple of months ago we had over 8000 users and didn't want to migrate them all to Chargify. We'd be shutting up shop right now if we had. I'm doubly lucky as I was about to start migrating users to do "one off" billing using Chargify. Given that every one of those would now count towards our monthly fee we'll be using a different service for "one off" purchases.
patio11 16y ago
Guys, if this upsets you, you are not in the target market. (Much love, but the real world spends real money on revenue drivers.)
- carbocation 16y ago
  If bootstrapped young startups aren't in Chargify's target market, then I'd argue that "the target market" was poorly chosen. Why might the low-budget territory (with costs from $0-$30/month) be useful for Chargify to cover? Not because you'll make much money from that territory. In fact, you might, on balance, lose money on the people who remain in that group. However, everyone who starts there won't stay there, because some will ultimately become your multi-thousand-subscription core users a year from now. In other words, it might act as a "loss leader." This pricing structure, given the pricing structure of the competition, risks diminishing the wellspring of new users for Chargify. Restated, my (testable) hypothesis is that (a) if you have similar competitors, and (b) you make yourself unpalatable to your low-tier users, then you will see reduced growth in your high-tier users. It looks like Chargify is willing to test that hypothesis.
- cglee 16y ago
  It's not so much as the money that's upsetting, as much as the broken trust when prices are adjusted upwards so dramatically. For example, our monthly prices will go from 0 to $99/month. You can say that may be a good thing, forcing us to focus on customer acquisition. But the point is that a service we budgeted X dollars for suddenly, dramatically increased. Of course $1200/yr is not life threatening. However, the trust is gone (or, at least it's dissolving quickly). As I wrote in my email to Chargify, if they're experiencing increasing costs, let us (their customers) know and be sincere - we are their fans! I WANT to pay them, because they have a quality product. But right now, it looks like a money grab after locking in developers. That part is upsetting.
- MicahWedemeyer 16y ago
  Pretty sure you're dead wrong here. I am in the target market, and I'll still make money using Chargify, but it took me two years to get where I am. Starting from zero today, Chargify would make absolutely no sense to even consider.
dangrossman 16y ago
Deja vu. This is exactly what Recurly did to its users a few months ago. It was a bad move, with negative effects for their company that were serious and lasting enough that they had to backpedal with new pricing a few months later.
- raerae7133 16y ago
  At Recurly, we did roll out new pricing in May of this year, and immediately received a lot of feedback from our users. We then modified our pricing plans again in July to reflect their feedback, and grandfathered existing users in, if they so preferred. Dan, I wish I could work with you to change your opinion of Recurly. I'd love to talk to you about your experiences and see what we can do to make it right. Rachel, Recurly Support
zefhous 16y ago
I fail to see how this could possibly be a good business decision for them. Seems pretty plain to me that they need to be going for the low end of the market — new startups with 0-100 customers — rather than the high end.
detst 16y ago
It's clear that none of these services have quite figured out how to best price their service but it seems that CheddarGetter is the only reasonably priced option. Why is it that they seem to be perceived as also-rans? With Chargify, you'd have to bring in $60,000/yr before they would begin to be reasonably priced. Completely unreasonable for a bootstrapper seeing if they have something that will stick.
podman 16y ago
Their justification on Twitter seems to be that they needed to get rid of their free tier. That makes some sense, but that doesn't really explain why they double the price for their lowest tier and increased the pricing on their other tiers as well. It's unfortunate that they're increasing their price without adding any extra value to the product.
- jacquesm 16y ago
  And the way to get rid of the free tier is to switch it off for new customers, not to scare the crap out of all your existing customers. Damage like this is hard to repair, it violates the trust between service provider and customer, in a b2b setting that is most unwise. B2c you might get away with it.
deleted 16y ago
[deleted]
Chargify 16y ago
Hey all, we've gotten a ton of feedback through Twitter, emails, tickets, and a few phone calls. Plus we interacted with a lot of people over the past couple of months. All of these inputs are coming together in a smaller plan we're releasing for existing merchants. Details will be out soon on our blog, via Twitter, etc.
- jacquesm 16y ago
  Stupid question: Didn't you see this response coming?
atldev 16y ago
You can predict the response based on a similar move made by Zendesk back in May (http://techcrunch.com/2010/05/18/zendesk-pricing/ http://techcrunch.com/2010/05/18/zendesk-pricing/). Spoiler alert: there will be backlash. It also strikes me as a dangerous strategic move. The reason I originally selected Chargify over competitors like Spreedly and CheddarGetter is because they had the lowest entry cost. I can experiment and find product market fit. By that point, I don't care so much about the monthly cost (and I'm locked in to a product that I like, which helped me reach my goals). The new pricing model is extreme enough to make me revisit the decision. I'm sure I'm not alone. I find their product and support to be great, and I'd like to see them keep a similar model. Maybe they should lower the thresholds (free up to 10 paying customers, for example). I'm sure there are other models that will work for them and their customers.
dh 16y ago
We appreciate the feedback from all of our loyal Chargify customers and we will have an update shortly to show we understand this support. A plan only available to those that already have accounts that will be much less and have a smaller number of customers. We are very sorry that we did not show this understanding in our announcement and pricing. No excuses.
proexploit 16y ago
I just joined Chargify Oct. 7th after the AppSumo bundle offered a $200 credit. 4 days later, they've raised their prices. I'm going to scrap the work I've done and go out of my way to use other services. The money isn't an issue. $99/month is fine, but I wouldn't pay it to get started.
- frankkysly 16y ago
  Just an FYI they have a free plan as well as a $39 plan.
CoffeeDregs 16y ago
Bummer. I just integrated this into a client's app... Wouldn't have done so with this pricing. Also, the price increase is possibly a sign of a problematical revenue model at Chargify. Probably not, but there's a chance that they really need to improve revenue and that gives me other doubts about whether to integrate with them.
tworats 16y ago
Here's the feedback I just submitted to Chargify: While I entirely understand the need to charge and make money, I find the sudden and significant change in pricing jarring. Many people just went from 0 to $1200 per year. I'm guessing the cost of supporting the formerly free (0-50 customers) tier is close to zero from a technical/infrastructure perspective, but relatively high from a support/feedback perpective. People in the free tier will either grow or go out of business. For those that grow, your cost is the same - you'll have the same questions whether you charge them day 1 or day 100. So the real issue is the cost of support for those who signup for the free tier and either flake out or go out of business. In my opinion, the rate of customer growth you'll get from having a free tier is worth the extra support cost. With no barrier in place, people will try Chargify, see that it's a high quality product, and if they have a viable business, will use it. That was our experience. With a barrier in place ($100/month from day 1), they'll do a lot of research and probably try the cheaper options before trying Chargify. For our particular case, I'm quite happy with Chargify as a product, but quite unhappy about the way the pricing was handled. With the former pricing tier we had the luxury of growing in cost as we grew in revenue. With the new pricing structure we have an immediate unexpected cost. Now we have to go and investigate the other recurring payment options, which bums me out entirely, since I was hoping we were well past that. You should, at the very least, grandfather the old users into the old plan. In my opinion you should keep the free tier around, but find ways to reduce your support costs. For my business, we treat support questions as the leading indicator for where we need to make the product more intuitive. We invest in improving the product, thereby also reducing costs. Of course that's just my opinion.
toast76 16y ago
Wow. What a kick in the nuts. UsabilityHub has just shy of 10,000 users. The VAST majority of those are free users, and a fair percentage of those are inactive. My Chargify bill would've just gone from $50p/month to $999p/month! And pretty soon I'd be looking at having to NEGOTIATE my pricing. What the fuck chargify? Fortunately for us, we saw the potential for asshole acts from Chargify and never registered our free users with them. If we had...well...we'd be royally screwed. $50 to $1000 with one newsletter. I feel like a moron the number of times I pointed to Chargify as a great way to do business. They were startup friendly, they helped you grow your business to the point where you'd be happy when you start paying them. I know we were! Most of all, Chargify were the beacon of freemium pricing. Not only were THEY freemium, they were very freemium friendly. In one swoop they've gone from the cheapest part of setting up your billing to being BY FAR the most expensive part. What a bunch of suckers all your customers are...us included. Chargify, you will NEVER under the hate you've just brought on yourselves.
ntalbott 16y ago
Full disclosure: I run Spreedly, an earlier to market but much less funded competitor to Chargify. Here's the dirty little secret that Spreedly discovered about 18 months ago, and that I'm sure Chargify - like Recurly before them - has now found out for themselves: there are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costing more than they ever bring in. That leaves businesses in this space two options: either focus on successful startups and actively filter out the "losers" (by charging a minimum of $99/month, for instance), or minimize costs for "low probability" businesses - and they're all low probability early on! - and use "cheap to try things out" as a star search for the few businesses that will end up getting big. Note that Chargify paired this price increase announcement with two other significant announcements that have largely been overshadowed by the hullabaloo: PCI Level 1 compliance, and 24/7 phone support. This pairing is not coincidence - I'm pretty confident that the pricing change is very firmly tied internally to these two new "features". PCI Level 1 compliance is a hefty upfront cost plus a large ongoing price tag. Good 24/7 phone support is crazy expensive to provide, and means that free customers would eat their lunch since so much of the support needs for one of these businesses is on the front end. The ridiculously huge mistake I think Chargify made here was something I thought was just a given these days: they should've unilaterally grandfathered all of their existing clients, and quietly given the grandfathered plan to anyone who was already integrating but not yet launched as well. When Spreedly made our last pricing change - from percent of transaction fee to flat per transaction fee - it was a price drop for most of our customers. But not all: anyone with super low prices would've ended up paying us more, so we explicitly made it the minimum of $0.20 or 2% of the transaction. There's just no excuse for ticking off existing customers - it makes you look like a cell phone company. Even if you absolutely have to raise prices across the board, I think three months of warning is the absolute minimum amount of time to give a customer base before you hit them with the increase. So, that's my $0.02 - hope it helps folks understand why I think this is happening. Questions, feedback, etc., welcome. P.S. I think in some areas Chargify's definitely ahead of Spreedly Subscriptions in terms of functionality - all of that extra capital definitely shows in the end product. But that's because we've been focused on "what's next" after you figure out the naive business model doesn't work in this space. I said above that there are two options. That's a lie - we're working on a third option. If there are any angels reading this that would like to invest in a team that's been thinking deeply about this space since before Chargify and Recurly were a twinkle in their founder's eye, drop me a line.
cpr 16y ago
With Patrick, I guess I understand the screams of pain on the unlooked-for price hike, but, even at the lowest non-developer level, you're only paying $0.20/month per customer. Assuming you're charging your customers at least $5/month, that's only $.04/customer/month, or less than 1%. Seems like a reasonable amount to pay for removing all the pain of recurring billing.
- carbocation 16y ago
  It's only $0.20/month/customer if you have 500 customers. If you have one customer, then it's $99/month/customer.
  - cpr 16y ago
    Good point, but if I were starting something that depended on recurring revenue, I wouldn't really begrudge $100/month to one of the most critical parts of the whole solution. Compare it to the $65/month I pay for a single Verizon Mifi data card, and it doesn't seem bad at all. Maybe you can't really look at per-user costs when you only have a handful of users. Everything looks badly distorted as you head up asymptotically from zero users.
    - carbocation 16y ago
      Yes, I think you're right about not looking at per-user costs while you're in the very-few-user stage. And if one doesn't grow to the point that these services are worthwhile at $100/month, then it's probably the case that one didn't get to a sustainable place, anyways. The $40/month offer that they added for existing customers is also a more accessible price point for those bootstrappers just getting started.
jread 16y ago
Chargify just sent an email offering existing customers a "Bootstrapping" plan. $39/mo for up to 100 customers. http://grasshopper.com/email_assets/chargify-bootstrapper.html http://grasshopper.com/email_assets/chargify-bootstrapper.ht...
jtchang 16y ago
I got this e-mail today and was totally floored. This is going to turn into a marketing/PR disaster for Chargify. They even sent out another e-mail to try and make up for their initial "mistake". Customers are very sensitive to pricing changes. The minute you decide to change pricing you should be thinking about it long and hard. While you are doing it you should be communicating to customers that you are thinking about a pricing change and solicit feedback. You need to be gently breaking the news to them. I signed up for Chargify to check out their pricing. I liked the fact that you could have 0-50 without paying anything. Considering development for a specific platform is not free this sudden pricing change has forced me to consider alternatives. As a customer who was just considering using them I feel kind of violated.
jread 16y ago
If you are bootstrapped and need low cost recurring payments capabilities here are a few fully outsourced and PCI compliant services you could consider: PayPal Website Payments Standard: 2.9% + $0.30/trans https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render-content&content_ID=merchant/wp_standard https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render... Google Subscription Payments (experimental): 2.9% + $0.30/trans http://code.google.com/apis/checkout/developer/Google_Checkout_Beta_Subscriptions.html http://code.google.com/apis/checkout/developer/Google_Checko... Aria SubscriptionPlus (via PayPal partnership): Free trial, then $40/mo https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render-content&content_ID=merchant/subscriptionsplus https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render...
adraper 16y ago
As a Chargify customer from very early on & having been in a paying position since early March (we launched in mid-January & it took a month & a half to hit a paying level) would we have used Chargify from the get-go if we had to pay for it? I can't say for certain but it's quite likely as it still would've been cheaper than moving development cycles into building a billing system (as it is we're still backlogged in that dept). If I was running a business that relied on a lot of freemium customers I might think twice, but then unless you're asking for credit cards up-front just don't put them into Chargify until they upgrade and give you their CC details. We handle gift subscriptions this way, unless they convert to a 'real' subscription when their gift is up they never go through Chargify. For what it's worth, it's safe to say after using Chargify for almost a year and having an active site using it for 9-10 months, the level of service and support we've received has been more than worth what we're paying — our development backlog is already a pain-point, I can't imagine what it'd be like if we were rolling our own billing system.
ohwaitnvm 16y ago
So the 2001st customer costs you $650 - how much they're paying. Still, that's probably > $600 for most startups, especially when you include trialing or 0-cost plan customers. I'd much prefer a graduated system, with different overall price deltas for each subsection (Dev/Start/Grow/Max) per member. For comparison: The first customer costs you $100-$price, The 501st customer costs you $250-$price, The 2001st costs you $650-$price
dh 16y ago
My name is David Hauser (@dh) and I am a founder at Chargify as well as the Grasshopper Group where I have spent the last 7 years serving hundreds of thousands of entrepreneurs and helping them to succeed. I want to respond directly here and invite anyone to reach out to me personally on Twitter or email to talk about this or anything else. We made a mistake with how we implemented and communicated a massive price increase and in doing so totally ignored our loyal and amazing customers that spent the time to integrate with Chargify. After starting many companies with NO outside capital I understand the struggles of a bootstraping company or lean startup so we should have done better with this. Listening to the feedback here and via many other channels this was very clear and we wanted to make a quick change. We have released a $39/month plan that supports 100 customers for anyone that has signed up for an account, does not matter if you never used or have not started to integrate. Some important points. - Only active customers are ever counted in your customer count - $39/month plan will be available for anyone that has a Chargify account now. Do not worry that you will miss signing up, it will be available for you - Offering the type of support that we want to is not cheap, and it is how we do business - PCI Level 1 is both expensive and valuable and we want to provide that to our customers While we firmly believe that Chargify and many competitors provide great value to a company that wants to do recurring billing we realize the mistake that was made. We will not go back to free as it will not allow us to support our customers the way we want to. There will always be a "cheap" or cheaper competitor out there but we are not that one.
- jdee 16y ago
  Just my 2c of course, IMHO, but a major reason you are getting so much grief is because of how difficult you have made it for people who cant now afford your services at the scale they once did, and how difficult it is for people to move from your service. >>There will always be a "cheap" or cheaper competitor out there but we are not that one. Well not now you are not. You hold all of their customers details, moving from chargify to something more affordable is a nigh on impossible task. I'd expect that there are more than a few startups who will just shut up shop who just dont have the resource to enter into a process of getting all of the users to re-sign up with alternative providers. Thats pretty sad dont you think?
- youmon 16y ago
youmon 16y ago
On TC now: http://techcrunch.com/2010/10/11/subscription-billing-system-chargify-missteps-as-it-switches-from-freemium-to-premium/ http://techcrunch.com/2010/10/11/subscription-billing-system...
dterra 16y ago
What I like about this is that Web Apps are now starting to remove the free plan. Makes it more exciting. People need to get used to pay, and not get everything for free. That way we can make money!
pauldoc 16y ago
This is a truly despicable and irresponsible business decision. Not only did Chargify pull a bait-and-switch but they completely pulled the rug out from under both developers and merchants by providing virtually no warning on this price change. Unfortunately, we launched with Chargify just a few months ago. Big mistake! Ning.com did this not long ago but did it in entirely responsible manner but providing many, many months of notice.
ericd 16y ago
As a side note, rolling your own subscription code using Authorize.net's CIM service (where they hold on to the CC numbers for you) is cheap and not really that hard, and it gives you the ability to do whatever custom stuff you want at lower cost. The API is a bit annoying, but I don't think I spent more than a day integrating it.
primigenus 16y ago
Ironically, we just wrote a blog post (http://blog.quplo.com/2010/10/the-payment-provider-shortlist-part-2-chargify/ http://blog.quplo.com/2010/10/the-payment-provider-shortlist...) about Chargify as it was in our "shortlist" of 3 remaining (subscription) payment providers that don't give European businesses a hard time. Chargify got a pretty good end of the stick, short of a couple of weird things like charging for free users. But with this pricing change, they're off the list. Sorry. So far it looks like Spreedly will be getting our money.

133 points by MicahWedemeyer 16y ago

This spooks me a bit. I'm a big fan of Chargify, but for their prices to jump like this and totally remove the free plan is scary. That will make it much less attractive to brand new web apps that don't have a proven business model. With the new pricing scheme your setup cost for accepting credit cards are merchant account, gateway (ie. Authorize.net), and $99/mo for Chargify. For most brand new web apps that's going to be significantly more than you pay for server/hosting costs. That's a bitter pill to swallow when you're not even sure if anyone will actually pay for your service.

nlco 16y ago
I agree, I'm working on a SaaS that is hopefully going to be deployed in a month where I was planning to use Chargify, but the $99/month seems hard to justify when I can just use paypal.
sv123 16y ago
this is disappointing. we were looking forward to starting to use chargify because of the free tier. Now I would be reluctant to even sign up until I was sure I had at least a few paying customers. I don't remember exactly but the free tier seemed pretty generous, maybe cutting that down to under 5-10 customers is free? To at least get people hooked on it without such a big barrier to entry.
- owkaye 16y ago
  Even giving me 5 customers free would encourage me to try them, but they can forget that now -- because I'm not going to commit to anything close to $99 a month unless I actually have hundreds of paying customers. Just my personal point of view, but it feels like they have so much business now that they no longer care about getting any new customers.

symkat 16y ago

Your pricing page does not look right in Chrome 6.0.472.63 on Mac (latest current). Screen cap: http://i.imgur.com/ffxIy.png http://i.imgur.com/ffxIy.png As someone who will be looking for this type of service in the near future, I agree with Michah that the pricing for a start up, especially one that's bootstrapping is not attractive at all. At this pricing it makes more sense to build my billing system and use Authorize.net.

thetrumanshow 16y ago

Spreedly: $20/month + $0.20 per transaction. .. and I'm using it on 2 apps. I was considering trying out Chargify, but not anymore. Unlike Spreedly, Chargify apparently wants me to pay a lot more up front for users I don't even have yet.

symkat 16y ago
Thanks, I've never heard of them!

petercooper 16y ago

It's not quite apples to apples but Recurly is similiar and is $29/mo for 500 users and under. They have some great Ruby integration demos too :-)

youmon 16y ago

Chargify can charge what it wants, but the pricing change was abrupt and BIG. Apps on the ground floor went from FREE to $1200/year. No grandfathering, 30 days to accept. For a service that needs to be integrated, that's a terrible move that shows no respect for startups.

wheels 16y ago
What's worse is that if you're already using them, you basically have no choice in the matter since the alternative is trying to get all of your customers to sign up again, which is basically a non-starter. Note that they also doubled prices for their first tier of paid customers from $600 to $1200.
- MicahWedemeyer 16y ago
  Well, technically you have all the customer data in your gateway's info manager (like Authorize.net's CIM), but it would still be a real bitch to take that and do anything useful with it. Plus, the clock is ticking on your 30 days to get it migrated to your new setup.
  - jacquesm 16y ago
    CC, EXP and CVC as well ? Without those you won't be doing much in terms of migration. Other than contacting the customer, figure you'll lose 75% or more of your business that way.
    - MicahWedemeyer 16y ago
      In our case, all that stuff is handled via the Authorize.net CIM. Chargify stores everything in the CIM and just makes calls to Authorize's API. To be clear: we can leave Chargify, but Authorize has us locked in.
      - jacquesm 16y ago
        What does chargify do for you that the authorize.net api can not do for you?

amccloud 16y ago

They need to include 50-100 customers for the free developer plan. If I was bootstrapping a service, I wouldn't pay $99 a month for customers I don't have yet.

mthomas 16y ago

Chargify requires that you setup both a payment gateway and a merchant account. Why would you use them instead of just integrating with the gateway directly?

MicahWedemeyer 16y ago
Chargify handles a lot of the recurring aspect, dealing with expired cards, notifying you if someone doesn't pay, etc, etc I talk a little about it here: http://peachshake.com/2010/06/15/saas-subscription-billing-or-how-to-avoid-getting-your-nts-in-a-vice/ http://peachshake.com/2010/06/15/saas-subscription-billing-o... It was a great deal for the price, but now...not so much.
- rwhitman 16y ago
  Your post did a good job of pitching chargify, I was passing it around the other day for justification to go with them. Such a bummer that they pulled this

matt1 16y ago

I've been slowly integrating Chargify into my app for the last several weeks and was blown away to read about this just now. One of the big selling points for me was the fact that it was free for up to 50 customers. I thought this was brilliant on their part because neither Recurly or Spreedly offer this. It got you locked into using their service, which is huge. That being said, I bet that 95% of their users are under the 50 users/month threshold and it must cost a bit to support them all. They must have calculated that it just wasn't worth it. I wish they would offer a cheaper plan for up to, say, 100 users. I think that would a great middle ground for new apps. I wrote a blog post a few weeks ago comparing the costs of Recurly, Spreedly, and Chargify and concluded Chargify was way in front [1]. I think they're way behind now. [1] http://www.mattmazur.com/2010/08/comparing-recurly-spreedly-and-chargify/ http://www.mattmazur.com/2010/08/comparing-recurly-spreedly-...

MicahWedemeyer 16y ago
This seems like a big shoot-self-in-foot moment. To get to 50+ users you have to start at zero. Cut out all your <50 customers and you'll never have any >50 customers. Seems blatantly obvious to me. I guess I must be missing something.
- alextgordon 16y ago
  I don't know why they don't just charge a set monthly amount for each user (up to a threshold). Say $1. So if you have 20 users you pay $20/month. That would allow them to keep their existing customers, cover their costs and provide a path for people to work up to $99/month. Also, they shouldn't have doubled their fees for existing paying customers.
  - 3pt14159 16y ago
    I empathize with you're sentiments, but I ran a split test for a SaaS based business and it turns out "packages" convert better, at least for their target market (law firms). It would be nice if everything was just a continuous curve, but people are more sold on "plans".

edanm 16y ago

I'm not sure I understand - what does the free developer option give you? Just the ability to integrate with your site (but not actually charge anyone)?

matt1 16y ago
Until today they offered a plan that let you use their service for free until you reached 50 customers. Now there's no free plan that you can use after you've launched your site. And for existing apps that use Chargify and have less than 50 customers, they're going to have to start paying $99/month to keep using the service. Edit: I understand your question now. Yes, the current free plan lets you integrate it into your site, but you can't actually start charging customers until you upgrade to the $99/mo plan.
- speric 16y ago
  I am that boat (existing app that uses Chargify, with < 50 customers). Sucks.

speric 16y ago

We have about 35 customers in Chargify, and growing steadily, but $99/month will eat almost half our monthly revenue. Really disappointed.

owkaye 16y ago
You should get out NOW so you can settle on a different company's services -- one that treats its customers better.
- speric 16y ago
  They've indicated that alternative arrangements can be made with existing merchants (not free, but not $99 either). We'll wait to see what those are before making a decision.
traskjd 16y ago
Really? Almost half your revenue is $99 off 35 customers? You charge your customers marginally more than $2.80 a month? Maybe I'm misunderstanding something here with the pricing, but this sounds more like you're getting hurt because you're trying to take micro payments which typically isn't a solved problem (yet).
- speric 16y ago
  >>Really? Almost half your revenue is $99 off 35 customers? Not sure how you got that. I'm not taking micropayments via Chargify. I don't think you understood me.
- speric 16y ago
  http://www.talentsoup.com/forum/topic/1023 http://www.talentsoup.com/forum/topic/1023

railsjedi 16y ago

That's a pretty huge price increase. With all the competition in this space (Recurly, CheddarGetter, Spreedly, many others), I would assume the prices would be going down, not skyrocketing up. They obviously are banking on the fact that their customers are already tied up with their API, so it would be difficult to switch. This is pretty sketchy, and it's going to make me very suspicious of these guys in the future. Also.. no grandfathering clause for existing paid clients?

heimidal 16y ago
I don't think you can expect these services to lower pricing any time soon. Why? It's clear now that Chargify and Recurly, who have both tried a very friendly freemium model, vastly underestimated the costs and problems associated with the businesses they are building. In both cases, it's a good bet that they needed to either raise prices or go out of business. Pricing only goes down once the business model is clearly established across multiple competitors. This space simply isn't clearly defined yet.

jacquesm 16y ago

> we do need to migrate everyone to the new pricing You can't change your pricing upwards for existing customers, ever. You can change your price to anything you want for new customers. You can decrease your prices for anybody at any point in time. Something like chargify is the basis for the business models of other parties, if you made a deal in the past you have to honor it, so that your customers can honor the deals that they made.

rgrieselhuber 16y ago
Agreed on pricing upwards for existing customers. Why would you ever punish your earliest customers for taking a risk on you? > You can decrease your prices for anybody at any point in time. I've heard this can actually be quite tricky as it makes your existing customers feel like they've been suckered.
- jacquesm 16y ago
  > I've heard this can actually be quite tricky as it makes your existing customers feel like they've been suckered. Not if you do it all across the board, and preferably gradually.
davidu 16y ago
Agreed. First, it's crazy that Chargify is not talking about this here and responding. (Update: they are responding quickly via Twitter) Second, when will companies understand and learn that you simply CAN NOT do this. Hell, how can any board member let a company do this? We just started looking at Chargify for all OpenDNS enterprise users (doing many $mm/year in transactions) but we thought their pricing might not scale up for us. So we had it on hold. The distinction between free and paid customers was critical for us. Now I know I was right not to pursue it. We'll continue with our home-built solution.
- deleted 16y ago
  [deleted]
- jackowayed 16y ago

endlessvoid94 16y ago

Wow. I'm about to launch a pretty involved startup, and we're bootstrapping. Chargify, you just DOUBLED our monthly expenses. Thanks a lot.

davidedicillo 16y ago

I found out about the change of pricing friday and I was really bummed about it. 50 free users were the perfect amount of user to guarantee some steady income before tackling the expense. It's also true that with a $25/mo you would need 7 clients to at least cover the billing costs (chargify/gateway/merchant acc.). Maybe instead they could have just change the free plan to 10 customers + no support. I looked at Spreedly, I loved their simplicity, but at the same time I feel they are missing some important features like discount and coupons management.

MJR 16y ago

It seems very clear that the free pricing was a great incentive for customers to sign up, allowing Chargify to get their business off the ground. Now that their business is running and they have paying customers, they have little need for keeping the free accounts and helping other businesses get off the ground. In my opinion, a really poor move and completely opposite of the mindset and spirit of their initial offering.

podman 16y ago

This was very disappointing to read. If their product were rock solid I wouldn't have minded as much but it's far from being a complete solution. Unfortunately, a lot of chargify needs a lot of work. I'm especially unhappy with the metered components as they enforce integer cent prices for the components and only allow integer usages on those components. It's impossible to charge fractional usages. I guess it's time to start writing my own billing system.

jon_dahl 16y ago
Agreed on the metered components. Chargify's metered billing system is not ready for primetime. I love the idea of a subscription management services, but this is still a very young space, unfortunately.

workhorse 16y ago

Moral of the story is, it is OK to offer a free plan to gain traction, and then remove it once you have it. This decision worries me on so many levels. I am so glad I went with Braintree Payment Solutions instead of Chargify. Chalk up another victory for my gut instinct paying off!

pjscott 16y ago
I think the real moral of the story is that it's not okay to offer a free plan and then suddenly remove it and jack everybody's prices up. Your customers will feel betrayed, and it'll be a PR disaster. I'm not sure if people will ever trust Chargify again.

nezumi 16y ago

I was seriously considering Chargify, but now... I just hope they take a leaf out of GitHub's book - remember this? http://github.com/blog/675-organizations-for-small-businesses http://github.com/blog/675-organizations-for-small-businesse...

steveaz98 16y ago

We just launched globalfolders.com using Chargify (on a very slim budget), thinking we could justify their costs once we graduated to a larger plan. This change erases that idea. It hurts more than just Chargify and their customers, it hurts anyone running such a service as people will be more likely to avoid services that they can't trust to keep their pricing stable (or at least give plenty of advance notice, 6 months to a year). These kind of changes definitely make me think much harder about outsourcing a service. How can we trust the current pricing? Do we have to change our pricing every time they change theirs? How many customers do we lose based on their bad business decisions? Chargify knows that people have spent time integrating with their service. They hope that this will give them a percentage of paying customers, knowing full well that they will lose a lot of customers. This is definitely a bad move for Chargify and a good decision for their competitors.

teye 16y ago

I find the new pricing chart to be misleading. By listing the free account next to their customer-enabled plans, at first glance I expect it to allow me to serve customers. http://chargify.com/pricing-and-signup/ http://chargify.com/pricing-and-signup/ Took me a minute to realize I get nothing (except the ability to integrate... SCORE!) by signing up. Smart to drive signups this way, but I think expectations are being set incorrectly.

bobx11 16y ago

I spent the last two days porting our code from paypal web payments pro over to chargify... and then they just jacked up their prices for starter level from 0 to $1,200 a year, and you still have to subscribe to authorize and the customer information manager - so they're just providing the gateway for $100/month. Ruined my afternoon, and probably tomorrow as I look at the other options like recurly.com , spreedly.com , cheddargetter.com , etc.

carbocation 16y ago
If you want to waste a bit more time, it would be great if you would take notes and submit a blog post to HN with what you find.

davidedicillo 16y ago

Some Chargify alternatives: http://cheddargetter.com http://cheddargetter.com http://www.spreedly.com http://www.spreedly.com http://recurly.com http://recurly.com http://www.braintreepaymentsolutions.com http://www.braintreepaymentsolutions.com

cglee 16y ago
Just a note that Recurly did this exact same thing several months ago, though they've since changed their prices again. We were literally 1 day away from launching on Recurly when they changed prices. Spooked by the sudden price hike, we spent a good deal of time re-writing our ecommerce on Chargify. And now this. Maybe it's time to just bite the bullet and roll our own solution. Spreedly doesn't provide the same functionality, but it's great if you just need a basic recurring payment solution without the frills or deep API integration. I haven't worked with CheddarGetter or BrainTree directly.
- jacquesm 16y ago
  If you can at all afford it get your own merchant account and work with an IPSP directly, keep control of your own data as much as is allowed and make a deal that if they go belly up that you will get access to your accounts for a one-time migration to another IPSP. Otherwise you're just setting yourself up for big trouble down the road. Middlemen in the payment business have a habit of going down when you need them most (when your business is successful and you are growing like mad, have a bunch of employees and suddenly your income evaporates). iBill, DMR, now Jettis in trouble and many others besides. All it takes is one big VISA fine for not following procedures and these operations will fold like a house of cards.
  - boundlessdreamz 16y ago
    braintree looks like the best option then. They are PCI Level 1 compliant and they are too big to go belly up and they have a great reputation.
- steveklabnik 16y ago

apowell 16y ago

I was piloting Chargify with about dozen customers to see if I wanted to make it the default platform for all of my customers. Now, definitely not. This bait and switch shows a complete lack of respect for everyone who has invested in the platform. Chargify, I'm sure you'll be laughing all the way to the bank, but not with my money. Does anyone sell an installable non-SaaS replacement for Chargify that integrates with Authorize.net CIM?

schammy 16y ago

Did they learn nothing from the Recurly debacle a few months back? I don't think their pricing is bad but they need a starter plan that's less than $99/month. Also, why are both Chargify and Recurly doing "bucket" plans with such high starting price points? Why not charge based on actual usage? If you have 500 paying customers you can justify $99/month no problem, but most people are going to take a while to build up to that size of customer base. These people can't start off with a $99/month plan. At least give maybe the first 10 customers for free, or charge on actual usage, e.g. $X per 10 customers or something like that. One thing's clear at least, if I ever go into the recurring payment business, Chargify and Recurly are both very good examples of what NOT to do to win customer loyalty.

gdevore 16y ago
The problem with charging for actual usage is that most of Chargify's support costs are probably incurred while their customers are setting things up. And that is when they don't have any users. Once you get chargify set up you don't have to touch it too much. Regardless though, this was a bad way to handle the price increase.
- run4yourlives 16y ago
  Are you suggesting that basic customer lifecycle management is an issue for them? That's not exactly reassuring. When you determine pricing, you figure this out. Every business has customer acquisition costs.

matt1 16y ago

Update on the Chargify support forum: We appreciate the feedback and will make something available to anyone that built their business around this. It will not be free but we will give a large discount for a smaller plan. More information to come shortly. http://support.chargify.com/discussions/support/3987-new-price-plans-very-concerned-feedback http://support.chargify.com/discussions/support/3987-new-pri... I wonder how it will work for someone like myself, who has spent a month integrating Chargify into my app but who hasn't launched yet. Discounted plan or $99/month?

markbao 16y ago

Wow, really? Chargify just lost its position as the best choice for subscription management. Extremely glad we didn't launch yet with Chargify... Here are some Chargify alternatives that we are looking at: Recurly, http://recurly.com/pricing/ http://recurly.com/pricing/ at 200 transactions and 500 users $29/m - Spreedly, http://spreedly.com/info/pricing/ http://spreedly.com/info/pricing/ at $19/m + $0.20/transaction or 2% per transaction if less - CheddarGetter, https://cheddargetter.com/pricing https://cheddargetter.com/pricing at $39/m -> 1000 customers, $0 per transaction. At the moment, we're probably going to switch to Spreedly, since the rates look good and they've been around for a while. Depends on what kind of dunning management they have. Correct me if I'm wrong, but it's pretty ironic that it was part of the lean startup bundle.

cglee 16y ago
Last time I looked, Spreedly's API and functionality wasn't even in the same ballpark as Chargify's. I've worked on integration projects with both, and Chargify is much better and more configurable. Spreedly may have improved, it's been a while.
- markbao 16y ago
  That is what I found when I last looked at Spreedly as well. Good opportunity for them to beef up their API to attract defectors.
- ntalbott 16y ago
  On the one hand, I agree with you - Spreedly's not as feature rich as some of the competition. On the other hand, we have a lot of very happy customers, so that doesn't mean we're not a good fit for a significant set of startups.
  - cglee 16y ago
    Very true, please count me as one of your satisfied customers. In a different comment, I did say Spreedly would be a great fit for those who just want a straight forward recurring billing solution, without deep API integration and other features offered by Chargify/Recurly. I forgot to note that here.

rwhitman 16y ago

Wow thats a real bummer, I was about to integrate it into an app, but I certainly don't want to blow $99/mo on something that may or may not earn me a small fraction of that Has anyone used Spreedly or CheddarGetter etc? Thoughts? Are there any robust open source self-hosted solutions? (For Django, Rails, PHP?) Considering its just a subscription management wrapper for Authorize.net, shouldn't be too hard to cut out the middleman

stympy 16y ago
Yes, self-hosted Rails solution here: http://railskits.com/saas http://railskits.com/saas Shameless self-promotion, yes, but it's actually relevant. :)

davidedicillo 16y ago

From their support site: All, We appreciate the feedback and will make something available to anyone that built their business around this. It will not be free but we will give a large discount for a smaller plan. More information to come shortly.

proee 16y ago

Bypass the SAAS model altogether and check out http://www.opengateway.net http://www.opengateway.net One-time fee for the script and you get all the power of chargify on your own host.

carbocation 16y ago
Am not well versed in this, but wouldn't the onus be on you to be PCI compliant then?
- proee 16y ago
  it depends on your sales volume. If you're a small starup you can do self-certification. Once your volume picks up you can go to the next step.
- brockf 16y ago
  If you have a hosted order form with Chargify, there's no difference between OpenGateway and Chargify when it comes to PCI compliance. VISA and MasterCard say you should be PCI compliant either way. Also, OpenGateway doesn't store credit card information which is always good.
moe 16y ago
This looks too good to be true. Where's the catch?

matt1 16y ago

Question, since this is getting a lot of discussion right now and it's relevant for anyone this impacts: If you run a subscription-based web app and you determine that you need to increase your prices, what's the best way to do it? Grandfathering existing customers obviously makes sense, but what if that's not an option? What if you need to charge them more to survive?

Goosey 16y ago
Make the old customers part of a 'legacy' tier which allows them to continue to pay the same and receive the same, but don't allow new customers to join that. Put new customers in the 'fancy shmancy' tier and allow old customers to migrate there (with price increase) for whatever new features you are adding. It's still going to be a bitter pill for the old customers, but it IS better than saying "Sorry, you gotsa pay more now! Suckers!"

adamhowell 16y ago

I feel like I'm missing something, because going by these pricing charts -- http://chargify.com/pricing-and-signup http://chargify.com/pricing-and-signup -- it seems like if you're a Chargify customer, "freemium" is no longer possible. We (http://mocksup.com http://mocksup.com) happily use Spreedly and only send customers to them when they're upgrading to a paid account. Can you not do this with Chargify? And if you can, what do they count as a "free" user?

toast76 16y ago
At UsabilityHub we (fortunately) circumvented their "free" user count by never sending them to Chargify in the first place. If we did, we'd be now getting billed $1000 a month. We did this because when we switch to chargify a couple of months ago we had over 8000 users and didn't want to migrate them all to Chargify. We'd be shutting up shop right now if we had. I'm doubly lucky as I was about to start migrating users to do "one off" billing using Chargify. Given that every one of those would now count towards our monthly fee we'll be using a different service for "one off" purchases.

patio11 16y ago

Guys, if this upsets you, you are not in the target market. (Much love, but the real world spends real money on revenue drivers.)

carbocation 16y ago
If bootstrapped young startups aren't in Chargify's target market, then I'd argue that "the target market" was poorly chosen. Why might the low-budget territory (with costs from $0-$30/month) be useful for Chargify to cover? Not because you'll make much money from that territory. In fact, you might, on balance, lose money on the people who remain in that group. However, everyone who starts there won't stay there, because some will ultimately become your multi-thousand-subscription core users a year from now. In other words, it might act as a "loss leader." This pricing structure, given the pricing structure of the competition, risks diminishing the wellspring of new users for Chargify. Restated, my (testable) hypothesis is that (a) if you have similar competitors, and (b) you make yourself unpalatable to your low-tier users, then you will see reduced growth in your high-tier users. It looks like Chargify is willing to test that hypothesis.
cglee 16y ago
It's not so much as the money that's upsetting, as much as the broken trust when prices are adjusted upwards so dramatically. For example, our monthly prices will go from 0 to $99/month. You can say that may be a good thing, forcing us to focus on customer acquisition. But the point is that a service we budgeted X dollars for suddenly, dramatically increased. Of course $1200/yr is not life threatening. However, the trust is gone (or, at least it's dissolving quickly). As I wrote in my email to Chargify, if they're experiencing increasing costs, let us (their customers) know and be sincere - we are their fans! I WANT to pay them, because they have a quality product. But right now, it looks like a money grab after locking in developers. That part is upsetting.
MicahWedemeyer 16y ago
Pretty sure you're dead wrong here. I am in the target market, and I'll still make money using Chargify, but it took me two years to get where I am. Starting from zero today, Chargify would make absolutely no sense to even consider.

dangrossman 16y ago

Deja vu. This is exactly what Recurly did to its users a few months ago. It was a bad move, with negative effects for their company that were serious and lasting enough that they had to backpedal with new pricing a few months later.

raerae7133 16y ago
At Recurly, we did roll out new pricing in May of this year, and immediately received a lot of feedback from our users. We then modified our pricing plans again in July to reflect their feedback, and grandfathered existing users in, if they so preferred. Dan, I wish I could work with you to change your opinion of Recurly. I'd love to talk to you about your experiences and see what we can do to make it right. Rachel, Recurly Support

zefhous 16y ago

I fail to see how this could possibly be a good business decision for them. Seems pretty plain to me that they need to be going for the low end of the market — new startups with 0-100 customers — rather than the high end.

detst 16y ago

It's clear that none of these services have quite figured out how to best price their service but it seems that CheddarGetter is the only reasonably priced option. Why is it that they seem to be perceived as also-rans? With Chargify, you'd have to bring in $60,000/yr before they would begin to be reasonably priced. Completely unreasonable for a bootstrapper seeing if they have something that will stick.

podman 16y ago

Their justification on Twitter seems to be that they needed to get rid of their free tier. That makes some sense, but that doesn't really explain why they double the price for their lowest tier and increased the pricing on their other tiers as well. It's unfortunate that they're increasing their price without adding any extra value to the product.

jacquesm 16y ago
And the way to get rid of the free tier is to switch it off for new customers, not to scare the crap out of all your existing customers. Damage like this is hard to repair, it violates the trust between service provider and customer, in a b2b setting that is most unwise. B2c you might get away with it.

deleted 16y ago

[deleted]

Chargify 16y ago

Hey all, we've gotten a ton of feedback through Twitter, emails, tickets, and a few phone calls. Plus we interacted with a lot of people over the past couple of months. All of these inputs are coming together in a smaller plan we're releasing for existing merchants. Details will be out soon on our blog, via Twitter, etc.

jacquesm 16y ago
Stupid question: Didn't you see this response coming?

atldev 16y ago

You can predict the response based on a similar move made by Zendesk back in May (http://techcrunch.com/2010/05/18/zendesk-pricing/ http://techcrunch.com/2010/05/18/zendesk-pricing/). Spoiler alert: there will be backlash. It also strikes me as a dangerous strategic move. The reason I originally selected Chargify over competitors like Spreedly and CheddarGetter is because they had the lowest entry cost. I can experiment and find product market fit. By that point, I don't care so much about the monthly cost (and I'm locked in to a product that I like, which helped me reach my goals). The new pricing model is extreme enough to make me revisit the decision. I'm sure I'm not alone. I find their product and support to be great, and I'd like to see them keep a similar model. Maybe they should lower the thresholds (free up to 10 paying customers, for example). I'm sure there are other models that will work for them and their customers.

dh 16y ago

We appreciate the feedback from all of our loyal Chargify customers and we will have an update shortly to show we understand this support. A plan only available to those that already have accounts that will be much less and have a smaller number of customers. We are very sorry that we did not show this understanding in our announcement and pricing. No excuses.

proexploit 16y ago

I just joined Chargify Oct. 7th after the AppSumo bundle offered a $200 credit. 4 days later, they've raised their prices. I'm going to scrap the work I've done and go out of my way to use other services. The money isn't an issue. $99/month is fine, but I wouldn't pay it to get started.

frankkysly 16y ago
Just an FYI they have a free plan as well as a $39 plan.

CoffeeDregs 16y ago

Bummer. I just integrated this into a client's app... Wouldn't have done so with this pricing. Also, the price increase is possibly a sign of a problematical revenue model at Chargify. Probably not, but there's a chance that they really need to improve revenue and that gives me other doubts about whether to integrate with them.

tworats 16y ago

Here's the feedback I just submitted to Chargify: While I entirely understand the need to charge and make money, I find the sudden and significant change in pricing jarring. Many people just went from 0 to $1200 per year. I'm guessing the cost of supporting the formerly free (0-50 customers) tier is close to zero from a technical/infrastructure perspective, but relatively high from a support/feedback perpective. People in the free tier will either grow or go out of business. For those that grow, your cost is the same - you'll have the same questions whether you charge them day 1 or day 100. So the real issue is the cost of support for those who signup for the free tier and either flake out or go out of business. In my opinion, the rate of customer growth you'll get from having a free tier is worth the extra support cost. With no barrier in place, people will try Chargify, see that it's a high quality product, and if they have a viable business, will use it. That was our experience. With a barrier in place ($100/month from day 1), they'll do a lot of research and probably try the cheaper options before trying Chargify. For our particular case, I'm quite happy with Chargify as a product, but quite unhappy about the way the pricing was handled. With the former pricing tier we had the luxury of growing in cost as we grew in revenue. With the new pricing structure we have an immediate unexpected cost. Now we have to go and investigate the other recurring payment options, which bums me out entirely, since I was hoping we were well past that. You should, at the very least, grandfather the old users into the old plan. In my opinion you should keep the free tier around, but find ways to reduce your support costs. For my business, we treat support questions as the leading indicator for where we need to make the product more intuitive. We invest in improving the product, thereby also reducing costs. Of course that's just my opinion.

toast76 16y ago

Wow. What a kick in the nuts. UsabilityHub has just shy of 10,000 users. The VAST majority of those are free users, and a fair percentage of those are inactive. My Chargify bill would've just gone from $50p/month to $999p/month! And pretty soon I'd be looking at having to NEGOTIATE my pricing. What the fuck chargify? Fortunately for us, we saw the potential for asshole acts from Chargify and never registered our free users with them. If we had...well...we'd be royally screwed. $50 to $1000 with one newsletter. I feel like a moron the number of times I pointed to Chargify as a great way to do business. They were startup friendly, they helped you grow your business to the point where you'd be happy when you start paying them. I know we were! Most of all, Chargify were the beacon of freemium pricing. Not only were THEY freemium, they were very freemium friendly. In one swoop they've gone from the cheapest part of setting up your billing to being BY FAR the most expensive part. What a bunch of suckers all your customers are...us included. Chargify, you will NEVER under the hate you've just brought on yourselves.

ntalbott 16y ago

Full disclosure: I run Spreedly, an earlier to market but much less funded competitor to Chargify. Here's the dirty little secret that Spreedly discovered about 18 months ago, and that I'm sure Chargify - like Recurly before them - has now found out for themselves: there are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costing more than they ever bring in. That leaves businesses in this space two options: either focus on successful startups and actively filter out the "losers" (by charging a minimum of $99/month, for instance), or minimize costs for "low probability" businesses - and they're all low probability early on! - and use "cheap to try things out" as a star search for the few businesses that will end up getting big. Note that Chargify paired this price increase announcement with two other significant announcements that have largely been overshadowed by the hullabaloo: PCI Level 1 compliance, and 24/7 phone support. This pairing is not coincidence - I'm pretty confident that the pricing change is very firmly tied internally to these two new "features". PCI Level 1 compliance is a hefty upfront cost plus a large ongoing price tag. Good 24/7 phone support is crazy expensive to provide, and means that free customers would eat their lunch since so much of the support needs for one of these businesses is on the front end. The ridiculously huge mistake I think Chargify made here was something I thought was just a given these days: they should've unilaterally grandfathered all of their existing clients, and quietly given the grandfathered plan to anyone who was already integrating but not yet launched as well. When Spreedly made our last pricing change - from percent of transaction fee to flat per transaction fee - it was a price drop for most of our customers. But not all: anyone with super low prices would've ended up paying us more, so we explicitly made it the minimum of $0.20 or 2% of the transaction. There's just no excuse for ticking off existing customers - it makes you look like a cell phone company. Even if you absolutely have to raise prices across the board, I think three months of warning is the absolute minimum amount of time to give a customer base before you hit them with the increase. So, that's my $0.02 - hope it helps folks understand why I think this is happening. Questions, feedback, etc., welcome. P.S. I think in some areas Chargify's definitely ahead of Spreedly Subscriptions in terms of functionality - all of that extra capital definitely shows in the end product. But that's because we've been focused on "what's next" after you figure out the naive business model doesn't work in this space. I said above that there are two options. That's a lie - we're working on a third option. If there are any angels reading this that would like to invest in a team that's been thinking deeply about this space since before Chargify and Recurly were a twinkle in their founder's eye, drop me a line.

cpr 16y ago

With Patrick, I guess I understand the screams of pain on the unlooked-for price hike, but, even at the lowest non-developer level, you're only paying $0.20/month per customer. Assuming you're charging your customers at least $5/month, that's only $.04/customer/month, or less than 1%. Seems like a reasonable amount to pay for removing all the pain of recurring billing.

carbocation 16y ago
It's only $0.20/month/customer if you have 500 customers. If you have one customer, then it's $99/month/customer.
- cpr 16y ago
  Good point, but if I were starting something that depended on recurring revenue, I wouldn't really begrudge $100/month to one of the most critical parts of the whole solution. Compare it to the $65/month I pay for a single Verizon Mifi data card, and it doesn't seem bad at all. Maybe you can't really look at per-user costs when you only have a handful of users. Everything looks badly distorted as you head up asymptotically from zero users.
  - carbocation 16y ago
    Yes, I think you're right about not looking at per-user costs while you're in the very-few-user stage. And if one doesn't grow to the point that these services are worthwhile at $100/month, then it's probably the case that one didn't get to a sustainable place, anyways. The $40/month offer that they added for existing customers is also a more accessible price point for those bootstrappers just getting started.

jread 16y ago

Chargify just sent an email offering existing customers a "Bootstrapping" plan. $39/mo for up to 100 customers. http://grasshopper.com/email_assets/chargify-bootstrapper.html http://grasshopper.com/email_assets/chargify-bootstrapper.ht...

jtchang 16y ago

I got this e-mail today and was totally floored. This is going to turn into a marketing/PR disaster for Chargify. They even sent out another e-mail to try and make up for their initial "mistake". Customers are very sensitive to pricing changes. The minute you decide to change pricing you should be thinking about it long and hard. While you are doing it you should be communicating to customers that you are thinking about a pricing change and solicit feedback. You need to be gently breaking the news to them. I signed up for Chargify to check out their pricing. I liked the fact that you could have 0-50 without paying anything. Considering development for a specific platform is not free this sudden pricing change has forced me to consider alternatives. As a customer who was just considering using them I feel kind of violated.

jread 16y ago

If you are bootstrapped and need low cost recurring payments capabilities here are a few fully outsourced and PCI compliant services you could consider: PayPal Website Payments Standard: 2.9% + $0.30/trans https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render-content&content_ID=merchant/wp_standard https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render... Google Subscription Payments (experimental): 2.9% + $0.30/trans http://code.google.com/apis/checkout/developer/Google_Checkout_Beta_Subscriptions.html http://code.google.com/apis/checkout/developer/Google_Checko... Aria SubscriptionPlus (via PayPal partnership): Free trial, then $40/mo https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render-content&content_ID=merchant/subscriptionsplus https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render...

adraper 16y ago

As a Chargify customer from very early on & having been in a paying position since early March (we launched in mid-January & it took a month & a half to hit a paying level) would we have used Chargify from the get-go if we had to pay for it? I can't say for certain but it's quite likely as it still would've been cheaper than moving development cycles into building a billing system (as it is we're still backlogged in that dept). If I was running a business that relied on a lot of freemium customers I might think twice, but then unless you're asking for credit cards up-front just don't put them into Chargify until they upgrade and give you their CC details. We handle gift subscriptions this way, unless they convert to a 'real' subscription when their gift is up they never go through Chargify. For what it's worth, it's safe to say after using Chargify for almost a year and having an active site using it for 9-10 months, the level of service and support we've received has been more than worth what we're paying — our development backlog is already a pain-point, I can't imagine what it'd be like if we were rolling our own billing system.

ohwaitnvm 16y ago

So the 2001st customer costs you $650 - how much they're paying. Still, that's probably > $600 for most startups, especially when you include trialing or 0-cost plan customers. I'd much prefer a graduated system, with different overall price deltas for each subsection (Dev/Start/Grow/Max) per member. For comparison: The first customer costs you $100-$price, The 501st customer costs you $250-$price, The 2001st costs you $650-$price

dh 16y ago

My name is David Hauser (@dh) and I am a founder at Chargify as well as the Grasshopper Group where I have spent the last 7 years serving hundreds of thousands of entrepreneurs and helping them to succeed. I want to respond directly here and invite anyone to reach out to me personally on Twitter or email to talk about this or anything else. We made a mistake with how we implemented and communicated a massive price increase and in doing so totally ignored our loyal and amazing customers that spent the time to integrate with Chargify. After starting many companies with NO outside capital I understand the struggles of a bootstraping company or lean startup so we should have done better with this. Listening to the feedback here and via many other channels this was very clear and we wanted to make a quick change. We have released a $39/month plan that supports 100 customers for anyone that has signed up for an account, does not matter if you never used or have not started to integrate. Some important points. - Only active customers are ever counted in your customer count - $39/month plan will be available for anyone that has a Chargify account now. Do not worry that you will miss signing up, it will be available for you - Offering the type of support that we want to is not cheap, and it is how we do business - PCI Level 1 is both expensive and valuable and we want to provide that to our customers While we firmly believe that Chargify and many competitors provide great value to a company that wants to do recurring billing we realize the mistake that was made. We will not go back to free as it will not allow us to support our customers the way we want to. There will always be a "cheap" or cheaper competitor out there but we are not that one.

jdee 16y ago
Just my 2c of course, IMHO, but a major reason you are getting so much grief is because of how difficult you have made it for people who cant now afford your services at the scale they once did, and how difficult it is for people to move from your service. >>There will always be a "cheap" or cheaper competitor out there but we are not that one. Well not now you are not. You hold all of their customers details, moving from chargify to something more affordable is a nigh on impossible task. I'd expect that there are more than a few startups who will just shut up shop who just dont have the resource to enter into a process of getting all of the users to re-sign up with alternative providers. Thats pretty sad dont you think?
youmon 16y ago

youmon 16y ago

On TC now: http://techcrunch.com/2010/10/11/subscription-billing-system-chargify-missteps-as-it-switches-from-freemium-to-premium/ http://techcrunch.com/2010/10/11/subscription-billing-system...

dterra 16y ago

What I like about this is that Web Apps are now starting to remove the free plan. Makes it more exciting. People need to get used to pay, and not get everything for free. That way we can make money!

pauldoc 16y ago

This is a truly despicable and irresponsible business decision. Not only did Chargify pull a bait-and-switch but they completely pulled the rug out from under both developers and merchants by providing virtually no warning on this price change. Unfortunately, we launched with Chargify just a few months ago. Big mistake! Ning.com did this not long ago but did it in entirely responsible manner but providing many, many months of notice.

ericd 16y ago

As a side note, rolling your own subscription code using Authorize.net's CIM service (where they hold on to the CC numbers for you) is cheap and not really that hard, and it gives you the ability to do whatever custom stuff you want at lower cost. The API is a bit annoying, but I don't think I spent more than a day integrating it.

primigenus 16y ago

Ironically, we just wrote a blog post (http://blog.quplo.com/2010/10/the-payment-provider-shortlist-part-2-chargify/ http://blog.quplo.com/2010/10/the-payment-provider-shortlist...) about Chargify as it was in our "shortlist" of 3 remaining (subscription) payment providers that don't give European businesses a hard time. Chargify got a pretty good end of the stick, short of a couple of weird things like charging for free users. But with this pricing change, they're off the list. Sorry. So far it looks like Spreedly will be getting our money.