YC’s BillForward Wants To Change The Way You’re Charged For Subscriptions

Amazon Prime, Netflix, utilities, the New York Times, HBO Go, the gym…

When you stop and think about all the subscriptions you have, the list probably is a bit longer than you thought.

But even as more subscription services become available, from ride shares to make up kits, it seems companies still offer customers limited subscription options due to constraints with their billing systems. Subscriptions rarely take into account how much you actually use them (If they did, most of us would probably be paying a lot more for Netlfix and a lot less for the gym).

Calling themselves “Stripe for subscription billing,” BillForward helps companies create customized billing services. BillForward CEO and co-founder Mark Parry said current subscription billing service software is outdated or difficult to use, and its time consuming and costly for companies to build their own.

The service allows companies to charge fixed subscription rates, but it can also introduce other variables such as usage or take account days like holidays that might not require charges. A good example of a company already implementing BillForward is Y Combinator’s LivBlends, the company that made a Keurig-like machine for smoothies and delivers them to businesses in bulk at the same time every week.

LivBlend’s ordering page is powered through BillForward. On the website, users can choose what days they want the smoothies delivered, how many they want, what size and what flavors. BillForward then charges a subscription rate, taking into account holidays such as Labor Day that may affect how many smoothies the company orders.

Parry said with existing subscription models, most small companies would only offer consumers a few different options. With BillForward, the pricing and choices can be much more customized.

BillForward isn’t the first subscription billing solution. Zuora offers software for companies ranging from startups to high volume multi-divisional enterprises. Recurly also provides a recurring billing platform. But the founders say they’re already seeing businesses using these companies express interest in switching to BillForward.

Ian Saunders, the BillForward CTO and co-founder, said installation of the BillForward API is fast and never takes more than a few days, even when it is customized.

The service also gives businesses analytics tools so they can easily check their revenue and growth. Parry said companies using the service have already seen increased revenue-by-average-user by 10%.

Right now BillForward is focused on small startups that generate about $25 million in revenue. But the company has grown rapidly since joining Y Combinator, and gained about 120 new businesses in the past few weeks. Parry said he expects the company to accommodate much larger businesses in the coming month.

Parry and Saunders founded the company with Aubone Tennant began BillForward about 18 months ago in London. In December the team began looking to expand its offices to Silicon Valley. They opened their second office in San Francisco in early 2014, and then started with Y Combinator in the spring.

Parry again and again had one word to describe the Y Combinator program — “fantastic.”

“Having gone through the process, I would recommend it to anyone considering,” Parry said. “Some people are concerned about the 7 percent equity, but it’s worth 14 percent.”

And it makes sense that a company for companies would feel that way. Just as Stripe benefited from other Y Combinator companies using its technology as they scaled up, so will BillForward. In addition to LivBlends, Several companies from this YC batch are already on board, including Roost and Front.

After presenting earlier this month at YC Demo Day, BillForward is raising a seed round.