Spreedly – Funding, expanding our horizons, pivoting

Posted on March 4, 2013 Justin Benson

For those of you who don’t know, Spreedly was born from a consulting project that bogged down trying to implement recurring billing with PayPal as a gateway. As developers ourselves we wanted a service that was easy to integrate and gave customers freedom from archaic business and development practices found at many payment gateways.

And so the journey began: we built a vault to store cards away from payment gateways (critical for recurring). We integrated with as many payment gateways as possible, via ActiveMerchant, to give our customers maximum choice. We dramatically reduced the burden of PCI compliance with a simple elegant hosted payments page (and later via a transparent redirect). We took care of prorating, upgrades and downgrades, dunning emails and so on. We tried to find all the ways that doing recurring/subscriptions against existing gateways was broken and fix it.

Over time three trends converged. People who had no interest in recurring or subscriptions approached us, intrigued by what we’d built to work effectively with 45 + payment gateways. Secondly, newer payment choices like Stripe, Pin Payments and PayMill emerged which included basic recurring capabilities. Lastly, we watched direct competitors arrive in the subscriptions space such as Recurly, Chargify and then later ChargeBee and Fusebill.

To prosper, we had one of two choices. We could double down on our subscription offering by distancing ourselves from the competing basic gateway offerings, which would mean adding support for such things as taxation, invoicing, shipping, multi language etc. Or, we could remove our recurring logic and give anyone who was doing online payments direct access to our API’s to go build great services.

We chose the second option and launched Spreedly Core to the public in March 2012. Within 8 months we were processing more monthly revenue via Spreedly Core than 3.5 years of subscriptions. We hope to process $25 million for customers in our first year ending in March. We have a long way to go but today we’re here to announce that we’re “all in” on Core. We closed a small angel/seed round in December 2012 and went to work.

Spreedly’s aimed at developers and services that:

  • Want to vault their credit cards away from the gateway yet don’t want to be in PCI scope by managing that process themselves
  • Need to work with multiple payment gateways either simultaneously or over time
  • Want to develop against a consistent, modern API that will work with any gateway we support irregardless of that gateway’s own API and documentation
  • Want to support non credit card payment types like Dwolla, GoCardless, PayPal and  more alongside credit cards

We know we’re not targeting everyone who wants to accept payments online. Services like Stripe, PayMill and Pin Payments have done a fantastic job of essentially making payments an afterthought – which is what they should be for many developers. However, if the inability to scale payments could be a drag on your business velocity then Spreedly is worth a look. It’s easier than ever to get a merchant account, and it’s not much more work to have the flexibility to change gateways or work with multiple gateways if that’s your focus.

Today, we’re announcing a new site and completely new pricing to reflect our new focus. We hope you enjoy it. Recurring and subscriptions are a critical component so we’ll continue to support our recurring customers today and going forward. It’s just that we’ve dramatically broadened the scope beyond recurring only. We’ve taken two sites and merged them into one. We’ve moved away from leading with subscriptions and now lead with our gateway flexibility story. Oh, and we’re pleased that some of those subscription competitors are now some of our most important Spreedly customers!

We’re open for business. Come solve scale related payments problems here.

Comments welcome here: http://news.ycombinator.com/item?id=5317894

Sign up for blog post updates

Get notified about new Spreedly articles on PCI compliance, gateways, & more.