5 ms·

Cost breakdown for Stripe, Braintree, Chargify, Recurly and Saasy

152 points by ajessup 15y ago

jpdoctor 15y ago
Would love to see the same thing for monthly billing, but with completely variable monthly payments.
- dangrossman 15y ago
  Most (all?) of these companies support that.
- mikey_p 15y ago
  Most of the services mentioned in the article can add "charges" to each months accounting for things like usage based systems. Of course if you're payments are completely variable, you'll have a hard time calculating with any service that charges a percentage for each transaction.
snprbob86 15y ago
> Where’s the Catch? Anyone care to comment? I can think of some potential ones, but have no first-hand experience with them, so I'll withhold comment. However, my biggest fear is derived from self-awareness. I run a startup and, no matter how good I think our code is, we fuck stuff up. Plenty. Oddly, in this sector, I trust an older company full of idiots more than a brand new startup full of brilliant hackers, if for no other reason than the idiots have already made their mistakes and are now just not gonna fuck with it. If they made it a few years, ironed out the kinks and then just they leave it alone, it's less likely to break :-P
- ceejayoz 15y ago
  > I run a startup and, no matter how good I think our code is, we fuck stuff up. Plenty. What makes you think that's unique to a startup?
  - snprbob86 15y ago
    Nothing. I never made that claim. I said "If they made it a few years, ironed out the kinks and then just they leave it alone, it's less likely to break". I have the same concerns about all new software from any provider. The same concerns applied to Google Checkout and Amazon Payments when they were new. I just happen to run a startup & have, as expected, observed this fact about software engineering. However, given the smaller teams and conflicting demands on attention for a startup, the problems may be more pronounced. Furthermore, billing is an industry filled with high degrees of both incidental AND inherent complexity. Navigating that complexity requires institutional knowledge that must be built over time.
- nirvdrum 15y ago
  The biggest one is Stripe does little beyond actually charging a card. If you're a business, you likely need to provide your customers with receipts via email at the very least, and ideally have a portal for them to look up their payment history. You probably don't want to bother with Dunning emails, either. If you go with Stripe, be prepared to implement all this yourself. I can't speak fully for the others, but I have used Chargify and Recurly. Chargify finally has statements. Recurly has a large emphasis on making sure your customers are retained -- so much so that they added their own payment gateway to help make sure that's the case. So, Stripe may be a low cost option on a per transaction basis, I just wouldn't brush aside the development costs that some of the other providers save you. In the end, Stripe may still be worth it for you -- it is for us. But that's the catch.
cloudwalking 15y ago
Stripe's simplicity blows me away. Payments is one of those things I always hated dealing with--you could never provide a decent user experience for a reasonable cost. Stripe's solution is exactly what I want, so much so it's baffling that nobody had ever done it their way. And since I'm not planning on doing $50M+ revenue anytime soon, they're cheap too :)
- thematt 15y ago
  I agree, from a customer's point of view Stripe is a godsend. However, I wonder if that level of simplicity is sustainable for them going forward. The reason other payment providers have paperwork and approval processes is because of liability and the reality that there are unscrupulous merchants out there. Is Stripe assuming an increased liability because of the ease at which anybody can just sign up?
  - dangrossman 15y ago
    I was somewhat surprised that when signing up I was not asked to agree to any terms, and there wasn't even a link to any on the signup form. When I did find them after signing up I see they require you to comply with PCIDSS, but by neither asking me to agree to this nor pushing it in their documentation at all, it's unlikely their users are going to actually do so. How many Stripe users are paying SecurityMetrics or ControlScan for their quarterly compliance scans? How many have even filled out the self-assessment questionnaire? So then comes the problem -- Stripe is encouraging developers, regardless of experience with security or payment systems, to set up direct credit card payment forms on their website (to be processed by Stripe's javascript). Lots of these servers probably have outdated services, CMS's and other packages with gaping security holes -- any of which would allow someone to hijack the form to silently send customers' credit card data somewhere else. In the end, who is Visa going to be able to get its half million dollar fine for a data breach by a site not in compliance with PCIDSS from? The merchant it has signed contracts with (Stripe via their underwriting banks) or the lone developers that have no funds to meet the security requirements, let alone pay fines on the resulting losses? I think Stripe's pitch deck would be an interesting thing to see.
dangrossman 15y ago
If you added PayPal to these charts it'd be well below all of the lines at all of the price points. It'd start at around 3% and drop to 2.2% very early in the graph. Plus, for most startups, not accepting PayPal is going to cost you customers. Especially non-US customers. In addition to the simple "Pay with PayPal" button scenario where you get all the simple subscriptions-as-a-service features built in (automatically handling failed payments and retries and notifying you of subscriptions, payments, cancellations, expiration of services, etc)... they'll also power your normal credit card payment forms on-site, and do token-based recurring billing (authorize payment once, charge the customer a variable amount whenever you need). That startups discount PayPal entirely because it's "not cool" and you can't chat with the founder at 4AM about your implementation is astounding to me. All of these other services are very expensive, less fully featured, and none of them come with 240 million pre-registered users and brand trust. Any reasonable decision maker should be at least considering them an option.
- jsankey 15y ago
  I've got no idea why you're being downvoted - perhaps your last paragraph is a little harsh. But you're right, it's odd not to see mention of PayPal. It works, it's inexpensive, and for non-US businesses it's one of the few available options.
  - ghc 15y ago
    He's probably being downvoted by people who have extensive experience in dealing with PayPal. Dealing with PayPal's rather frequent API outages can be hell for businesses and developers. If you have a small enough business that you don't need to use the API, then go for it, but otherwise, you might just wind up scraping the PayPal site pages when there's an outage.
- xanados 15y ago
  Using PayPal is basically a crap shoot for recurring virtual services. As one poster on Hacker News said, if you aren't putting physical items in boxes and shipping to customers homes, you aren't in PayPal's target market.
jsankey 15y ago
Missing from this analysis is which options are available outside the US. I've tried to quicky figure this out for each provider, please correct me if I'm wrong: - Braintree: only if doing 3 million+/year. - Chargify: in theory yes, if you can find a merchant provider that accepts you with reasonable terms, which isn't easy. - Recurly: "Recurly supports SagePay and PayPal in the U.K. and Ireland, as well as Wirecard throughout the broader European Union." - Saasy: Yes. - Strip: Not yet. Although it makes sense to start in the US market, it's getting to the point where all most alternatives are US-centric, and there's a big world of us out here that would also love better payment gateways!
- richardw 15y ago
  I think there's a huge market of non-US startups that would love to find a Stripe equivalent that they could use. Much easier to compete than going head-to-head with the US crowd, whose customers are spoiled for choice. That's what Shuttleworth in effect did - fulfilled a demand outside the US for a service that US companies couldn't legally fulfil. Got him into space. Not bad.
- lclarkmichalek 15y ago
  Which is precisely why I chose saasy for my web app, being based in the uk. Same goes for tropo vs twillio, until twillio lainched uk sms yesterday.
  - mise 15y ago
    And how has your experience been with Sassy?
    - Ecio78 15y ago
      I've just checked their page, featurewise they look like very interesting, but their pricing is far from being cheap: "Pricing is 5.9% plus $.95 or 8.9% flat per order, whichever you prefer. The minimum order fee is $.75 per order." EDIT: according to http://saasy.com/matrix.php http://saasy.com/matrix.php it includes also the merchant fees, unfortunately in their comparison Stripe is not cited
rafamvc 15y ago
How complicated is it to use https://www.dwolla.com/ https://www.dwolla.com/ for recursive payments? It seems to be cheaper than all the other options. .25 cents per transaction, no matter the volume.
- dangrossman 15y ago
  Dwolla doesn't let you accept credit cards.
rafamvc 15y ago
How complicated is it to use https://www.dwolla.com/ https://www.dwolla.com/ for recursive payments? It seems to be cheaper than all the other options. .25 cents per transaction, no matter the volume.
torontos 15y ago
Why not include Samurai (http://samurai.feefighters.com http://samurai.feefighters.com)? Seems like it would be cheaper than the other ones and the api docs look breezy like stripes. It's only 2.3% + 30cents. Also look at Spreedly for recurring.
GICodeWarrior 15y ago
I am in the process of integrating Recurly into my existing business, and I have to say, those graphs misleading regarding Recurly. The Recurly gateway is already included with the normal Recurly costs. Zero out the gateway numbers in the calculator there and you will see the difference. http://expletiveinserted.com/recurring-payment-cost-calculator/ http://expletiveinserted.com/recurring-payment-cost-calculat... Granted, Stripe avoids the paperwork and business requirements for getting a merchant account. However, I already had most of those requirements ticked (you need them anyways if you intend to operate aboveboard), and I want all the subscription management features Recurly provides. Further, the Recurly gateway includes credit card portability (Braintree is the only other company I know of that supports this). http://www.portabilitystandard.org/ http://www.portabilitystandard.org/ EDIT: Removed incorrect merchant account fees.
- thehammer 15y ago
  Portability is very important and often overlooked. Braintree created the Credit Card Data Portability Standard a couple years back, and I think there are may be a few additional companies supporting it now. http://www.braintreepayments.com/blog/data-portability http://www.braintreepayments.com/blog/data-portability
- dangrossman 15y ago
  > a good merchant account will have rates under $0.20/transaction That's impossible. Visa and MasterCard's interchange rates are 1.15% - 2.7% + $0.10 per transaction, that's the floor at which a merchant account could start its pricing.
  - GICodeWarrior 15y ago
    Sorry, you are right, I was only quoting the merchant account rates on top of the interchange. The 1.94%/transaction on that page is competitive. With that and my other numbers, the Recurly are still competitive with Stripe.
- torontos 15y ago
  We looked at Recurly too... You are wrong that you can just zero out the gateway numbers in the calculators. Recurly charges 1.25% + 10 cents (http://recurly.com/pricing http://recurly.com/pricing). 1.25% is a CRAPLOAD. Using a merchant account from FeeFighters would for us end up costing something like 2.1% + 20cents for the merchant account but then we'd have to pay an additional 1.25% + 10cents to Recurly, making it a total of 3.35% + 30 cents, far more than Stripe. Plus there's a $69 minimum fee, which sucks when you are starting out Chargify (http://chargify.com http://chargify.com) or Spreedly (http://spreedly.com http://spreedly.com) + Samurai (http://samurai.feefighters.com http://samurai.feefighters.com) is going to be significantly cheaper in our case (we expect to ramp to $30k/sales/mo). I'll pretty-up and share the google spreadsheet I used shortly. Stripe is still the best option if you have low transaction size and low volume (I think it was <$6k/mo). Other than that it was either chargify+samurai or spreedly+samurai (depending on the number of transactions because of chargify's tricky pricing)
chris123 15y ago
Would like to see the banking industry disrupted even more in 2012+, such as by Dwolla, which was covered in the mainstream media yesterday in this good 2-minute CNN video clip: http://goo.gl/ISZ9C http://goo.gl/ISZ9C (Note: I've got nothing to do with Dwolla, just supporter of disruptive companies like them.)
- dangrossman 15y ago
  What's disruptive about Dwolla? PayPal has always let you fund payments by bank transfer and person-to-person payments are free to send and receive. As far as I can tell reading their site, they are PayPal without 90% of the features but a better mobile app, and the only benefit for merchants is the introductory $0.25 pricing. If ACH-funded person-to-person payments are going to disrupt the banking industry, why didn't it 12 years ago when PayPal started doing it?
  - smackfu 15y ago
    In addition, Paypal is currently making $$$ on ACH payments that they charge their full fees for. They can flip a switch and change those back to free or $0.25 and kill any Dwolla advantages.
casca 15y ago
The main reason for the nature of credit-card fees (fixed+percentage) is to manage the fraud. Stripe's simplicity of access means that it is going to be completely destroyed by fraud. The reason for the effort in getting merchant accounts is that if you take the money and run, the organization that gave you the merchant account is responsible for the chargebacks, up to 6 months later. 6 months is a long time. It's not feasible for most businesses to wait that long to get their money. Hence the percentage charge to cover the risk of fraud. If you think that a 2% charge means that 1 in 50 of every transactions is fraudulent already, imagine what a skilled fraudster will do.
thaumaturgy 15y ago
As a gentle aside: the graphs in this post are pretty nice, but I can't tell what's what in them because the colors are evil. I'm one of a large number of colorblind men (http://robsheldon.com/colorblind/ http://robsheldon.com/colorblind/).

152 points by ajessup 15y ago

jpdoctor 15y ago

Would love to see the same thing for monthly billing, but with completely variable monthly payments.

dangrossman 15y ago
Most (all?) of these companies support that.
mikey_p 15y ago
Most of the services mentioned in the article can add "charges" to each months accounting for things like usage based systems. Of course if you're payments are completely variable, you'll have a hard time calculating with any service that charges a percentage for each transaction.

snprbob86 15y ago

> Where’s the Catch? Anyone care to comment? I can think of some potential ones, but have no first-hand experience with them, so I'll withhold comment. However, my biggest fear is derived from self-awareness. I run a startup and, no matter how good I think our code is, we fuck stuff up. Plenty. Oddly, in this sector, I trust an older company full of idiots more than a brand new startup full of brilliant hackers, if for no other reason than the idiots have already made their mistakes and are now just not gonna fuck with it. If they made it a few years, ironed out the kinks and then just they leave it alone, it's less likely to break :-P

ceejayoz 15y ago
> I run a startup and, no matter how good I think our code is, we fuck stuff up. Plenty. What makes you think that's unique to a startup?
- snprbob86 15y ago
  Nothing. I never made that claim. I said "If they made it a few years, ironed out the kinks and then just they leave it alone, it's less likely to break". I have the same concerns about all new software from any provider. The same concerns applied to Google Checkout and Amazon Payments when they were new. I just happen to run a startup & have, as expected, observed this fact about software engineering. However, given the smaller teams and conflicting demands on attention for a startup, the problems may be more pronounced. Furthermore, billing is an industry filled with high degrees of both incidental AND inherent complexity. Navigating that complexity requires institutional knowledge that must be built over time.
nirvdrum 15y ago
The biggest one is Stripe does little beyond actually charging a card. If you're a business, you likely need to provide your customers with receipts via email at the very least, and ideally have a portal for them to look up their payment history. You probably don't want to bother with Dunning emails, either. If you go with Stripe, be prepared to implement all this yourself. I can't speak fully for the others, but I have used Chargify and Recurly. Chargify finally has statements. Recurly has a large emphasis on making sure your customers are retained -- so much so that they added their own payment gateway to help make sure that's the case. So, Stripe may be a low cost option on a per transaction basis, I just wouldn't brush aside the development costs that some of the other providers save you. In the end, Stripe may still be worth it for you -- it is for us. But that's the catch.

cloudwalking 15y ago

Stripe's simplicity blows me away. Payments is one of those things I always hated dealing with--you could never provide a decent user experience for a reasonable cost. Stripe's solution is exactly what I want, so much so it's baffling that nobody had ever done it their way. And since I'm not planning on doing $50M+ revenue anytime soon, they're cheap too :)

thematt 15y ago
I agree, from a customer's point of view Stripe is a godsend. However, I wonder if that level of simplicity is sustainable for them going forward. The reason other payment providers have paperwork and approval processes is because of liability and the reality that there are unscrupulous merchants out there. Is Stripe assuming an increased liability because of the ease at which anybody can just sign up?
- dangrossman 15y ago
  I was somewhat surprised that when signing up I was not asked to agree to any terms, and there wasn't even a link to any on the signup form. When I did find them after signing up I see they require you to comply with PCIDSS, but by neither asking me to agree to this nor pushing it in their documentation at all, it's unlikely their users are going to actually do so. How many Stripe users are paying SecurityMetrics or ControlScan for their quarterly compliance scans? How many have even filled out the self-assessment questionnaire? So then comes the problem -- Stripe is encouraging developers, regardless of experience with security or payment systems, to set up direct credit card payment forms on their website (to be processed by Stripe's javascript). Lots of these servers probably have outdated services, CMS's and other packages with gaping security holes -- any of which would allow someone to hijack the form to silently send customers' credit card data somewhere else. In the end, who is Visa going to be able to get its half million dollar fine for a data breach by a site not in compliance with PCIDSS from? The merchant it has signed contracts with (Stripe via their underwriting banks) or the lone developers that have no funds to meet the security requirements, let alone pay fines on the resulting losses? I think Stripe's pitch deck would be an interesting thing to see.

dangrossman 15y ago

If you added PayPal to these charts it'd be well below all of the lines at all of the price points. It'd start at around 3% and drop to 2.2% very early in the graph. Plus, for most startups, not accepting PayPal is going to cost you customers. Especially non-US customers. In addition to the simple "Pay with PayPal" button scenario where you get all the simple subscriptions-as-a-service features built in (automatically handling failed payments and retries and notifying you of subscriptions, payments, cancellations, expiration of services, etc)... they'll also power your normal credit card payment forms on-site, and do token-based recurring billing (authorize payment once, charge the customer a variable amount whenever you need). That startups discount PayPal entirely because it's "not cool" and you can't chat with the founder at 4AM about your implementation is astounding to me. All of these other services are very expensive, less fully featured, and none of them come with 240 million pre-registered users and brand trust. Any reasonable decision maker should be at least considering them an option.

jsankey 15y ago
I've got no idea why you're being downvoted - perhaps your last paragraph is a little harsh. But you're right, it's odd not to see mention of PayPal. It works, it's inexpensive, and for non-US businesses it's one of the few available options.
- ghc 15y ago
  He's probably being downvoted by people who have extensive experience in dealing with PayPal. Dealing with PayPal's rather frequent API outages can be hell for businesses and developers. If you have a small enough business that you don't need to use the API, then go for it, but otherwise, you might just wind up scraping the PayPal site pages when there's an outage.
xanados 15y ago
Using PayPal is basically a crap shoot for recurring virtual services. As one poster on Hacker News said, if you aren't putting physical items in boxes and shipping to customers homes, you aren't in PayPal's target market.

jsankey 15y ago

Missing from this analysis is which options are available outside the US. I've tried to quicky figure this out for each provider, please correct me if I'm wrong: - Braintree: only if doing 3 million+/year. - Chargify: in theory yes, if you can find a merchant provider that accepts you with reasonable terms, which isn't easy. - Recurly: "Recurly supports SagePay and PayPal in the U.K. and Ireland, as well as Wirecard throughout the broader European Union." - Saasy: Yes. - Strip: Not yet. Although it makes sense to start in the US market, it's getting to the point where all most alternatives are US-centric, and there's a big world of us out here that would also love better payment gateways!

richardw 15y ago
I think there's a huge market of non-US startups that would love to find a Stripe equivalent that they could use. Much easier to compete than going head-to-head with the US crowd, whose customers are spoiled for choice. That's what Shuttleworth in effect did - fulfilled a demand outside the US for a service that US companies couldn't legally fulfil. Got him into space. Not bad.
lclarkmichalek 15y ago
Which is precisely why I chose saasy for my web app, being based in the uk. Same goes for tropo vs twillio, until twillio lainched uk sms yesterday.
- mise 15y ago
  And how has your experience been with Sassy?
  - Ecio78 15y ago
    I've just checked their page, featurewise they look like very interesting, but their pricing is far from being cheap: "Pricing is 5.9% plus $.95 or 8.9% flat per order, whichever you prefer. The minimum order fee is $.75 per order." EDIT: according to http://saasy.com/matrix.php http://saasy.com/matrix.php it includes also the merchant fees, unfortunately in their comparison Stripe is not cited

rafamvc 15y ago

How complicated is it to use https://www.dwolla.com/ https://www.dwolla.com/ for recursive payments? It seems to be cheaper than all the other options. .25 cents per transaction, no matter the volume.

dangrossman 15y ago
Dwolla doesn't let you accept credit cards.

rafamvc 15y ago

torontos 15y ago

Why not include Samurai (http://samurai.feefighters.com http://samurai.feefighters.com)? Seems like it would be cheaper than the other ones and the api docs look breezy like stripes. It's only 2.3% + 30cents. Also look at Spreedly for recurring.

GICodeWarrior 15y ago

I am in the process of integrating Recurly into my existing business, and I have to say, those graphs misleading regarding Recurly. The Recurly gateway is already included with the normal Recurly costs. Zero out the gateway numbers in the calculator there and you will see the difference. http://expletiveinserted.com/recurring-payment-cost-calculator/ http://expletiveinserted.com/recurring-payment-cost-calculat... Granted, Stripe avoids the paperwork and business requirements for getting a merchant account. However, I already had most of those requirements ticked (you need them anyways if you intend to operate aboveboard), and I want all the subscription management features Recurly provides. Further, the Recurly gateway includes credit card portability (Braintree is the only other company I know of that supports this). http://www.portabilitystandard.org/ http://www.portabilitystandard.org/ EDIT: Removed incorrect merchant account fees.

thehammer 15y ago
Portability is very important and often overlooked. Braintree created the Credit Card Data Portability Standard a couple years back, and I think there are may be a few additional companies supporting it now. http://www.braintreepayments.com/blog/data-portability http://www.braintreepayments.com/blog/data-portability
dangrossman 15y ago
> a good merchant account will have rates under $0.20/transaction That's impossible. Visa and MasterCard's interchange rates are 1.15% - 2.7% + $0.10 per transaction, that's the floor at which a merchant account could start its pricing.
- GICodeWarrior 15y ago
  Sorry, you are right, I was only quoting the merchant account rates on top of the interchange. The 1.94%/transaction on that page is competitive. With that and my other numbers, the Recurly are still competitive with Stripe.
torontos 15y ago
We looked at Recurly too... You are wrong that you can just zero out the gateway numbers in the calculators. Recurly charges 1.25% + 10 cents (http://recurly.com/pricing http://recurly.com/pricing). 1.25% is a CRAPLOAD. Using a merchant account from FeeFighters would for us end up costing something like 2.1% + 20cents for the merchant account but then we'd have to pay an additional 1.25% + 10cents to Recurly, making it a total of 3.35% + 30 cents, far more than Stripe. Plus there's a $69 minimum fee, which sucks when you are starting out Chargify (http://chargify.com http://chargify.com) or Spreedly (http://spreedly.com http://spreedly.com) + Samurai (http://samurai.feefighters.com http://samurai.feefighters.com) is going to be significantly cheaper in our case (we expect to ramp to $30k/sales/mo). I'll pretty-up and share the google spreadsheet I used shortly. Stripe is still the best option if you have low transaction size and low volume (I think it was <$6k/mo). Other than that it was either chargify+samurai or spreedly+samurai (depending on the number of transactions because of chargify's tricky pricing)

chris123 15y ago

Would like to see the banking industry disrupted even more in 2012+, such as by Dwolla, which was covered in the mainstream media yesterday in this good 2-minute CNN video clip: http://goo.gl/ISZ9C http://goo.gl/ISZ9C (Note: I've got nothing to do with Dwolla, just supporter of disruptive companies like them.)

dangrossman 15y ago
What's disruptive about Dwolla? PayPal has always let you fund payments by bank transfer and person-to-person payments are free to send and receive. As far as I can tell reading their site, they are PayPal without 90% of the features but a better mobile app, and the only benefit for merchants is the introductory $0.25 pricing. If ACH-funded person-to-person payments are going to disrupt the banking industry, why didn't it 12 years ago when PayPal started doing it?
- smackfu 15y ago
  In addition, Paypal is currently making $$$ on ACH payments that they charge their full fees for. They can flip a switch and change those back to free or $0.25 and kill any Dwolla advantages.

casca 15y ago

The main reason for the nature of credit-card fees (fixed+percentage) is to manage the fraud. Stripe's simplicity of access means that it is going to be completely destroyed by fraud. The reason for the effort in getting merchant accounts is that if you take the money and run, the organization that gave you the merchant account is responsible for the chargebacks, up to 6 months later. 6 months is a long time. It's not feasible for most businesses to wait that long to get their money. Hence the percentage charge to cover the risk of fraud. If you think that a 2% charge means that 1 in 50 of every transactions is fraudulent already, imagine what a skilled fraudster will do.

thaumaturgy 15y ago

As a gentle aside: the graphs in this post are pretty nice, but I can't tell what's what in them because the colors are evil. I'm one of a large number of colorblind men (http://robsheldon.com/colorblind/ http://robsheldon.com/colorblind/).