B2B SaaS Pricing & Billing Made Easy | Schematic Q3 Learnings

Hey everybody, I'm Fynn. I'm with Schematic. This is going to be an update on everything that Schematic has done and learned over the course of the last quarter. Before I get into it, let me go back and provide a little background context. So when Ben, Jazz, Gio, and I founded Schematic in June of '23, we founded it to solve a problem that we'd run into at prior companies. We had faced constant roadblocks around pricing, packaging, and billing because any change that we wanted to make always required code changes. Before founding the company, we interviewed nearly 30 CTOs to compare their experience to ours, and they consistently described the issue along the lines of hardcoded pricing. This often meant that logic that dictated what a customer would have access to in a product based on a contract or a subscription lived in application code, which meant that if you wanted to launch a third tier or give a special customer a plan exception or run a pricing migration or unbundle a tier, there was always this really crummy trade-off. And that was I can either invest in new features or I can invest in billing and pricing initiatives. It also meant that the billing experience that we were giving our customers was often really high friction. We constantly saw customer support channels flooded with questions like, I want to see what I used last month to reconcile my invoice. Why is it so hard to upgrade or downgrade? The way that we had always solved these problems in prior companies was with a lot of homegrown glue. And at the heart of that were often entitlement implementations that were either hardcoded into the product and then tied to plan IDs in our billing system, or via long-lived feature flags that lacked billing or commercial context. And so to solve this, we saw an opportunity to extend feature flags into entitlement management, allowing product teams to adjust pricing without engineering. And as we started to think about this more and interviewing more and more people, this got really exciting because we started to imagine how powerful extending feature flags as a primitive could be for both developers and for companies more broadly. As LaunchDarkly engineer Brian Rinaldi and VP product Joe Ryan have said, there's this huge potential for organizations to extend feature flagging and entitlements to better support customer exceptions and to better support pricing agility. So if you go back 3 months ago to the beginning of Q3, this is how we were positioned. We were positioned as this entitlement service that sat between an application and the downstream business systems. And throughout the quarter, as our early customers started using the product and driving a lot of feature requests into Slack, a theme started to emerge. And that theme was really all about customer experience with billing. Our customers were saying things like, "We need to deliver more transparency to our customers about what they've used." We need to make it easier for our customers to manage their plans. We need to make it easier for our customers to add seats. We need to make it easier for our customers to upgrade or downgrade. We need to make it easier for our customers to buy an add-on. That feedback resonated with us quite a bit, and it got us thinking a lot about the B2B SaaS purchasing experience at large. In prior companies, our customers always ran into poor purchasing experiences by way of poor in-app controls for managing plans, lack of transparency about usage and billing, ineffective trial experiences. The list goes on and on. And the more we heard this feedback from our customers, the more we started to hone in on a more customer-facing solution. Fast forward to the end of Q3 several weeks ago, and we're now no longer describing ourselves as an entitlement service, but instead as a set of drop-in components for complete plan management that supercharges Stripe. Most startups choose Stripe for billing, but they soon realize that there's a ton of infrastructure needed to, to build, to manage pricing and packaging. This additional infrastructure usually involves building and maintaining a set of really predictable components: admin panels, feature flags, entitlements, product catalogs, a bunch of UX for plan management. Think upgrade paths, usage meters, customer portals, etc. Developers should not have to build or maintain any of this. None of it is core to their product. We call this the last mile of pricing and packaging, and central to what we're trying to do for our customers is make it really easy for developers to outsource this last mile. So that they can focus on shipping new value and avoid getting bogged down in the latest pricing or billing initiative. Schematic components are fully custom— fully customizable drop-in components for React. They allow you to design and configure purchasing experiences within Schematic and easily integrate them into your app. Components— another way to think about components is that they're the most visual representation of what our API is doing behind the scenes. With our component builder, you get full control over what your end users see. You can tailor the experience to your needs and adjust over time without rebuilding. Components are flexible. They're made up of mix-and-match elements based on the user experience that you want to create. What's available now are several components: current plan, included features, next bill date, payment methods, invoices. Each component element is customizable. More elements are on the way and more components are on the way, and we're, we're building out a long list of components that we will templatize over the next few months. Underpinning all of this is flags and entitlements. Flags give full control over what to offer your customers and simplifies the integration in the application. You're instrumenting features, you're defining policy for what your customers should have access to based on what they purchased. Metering allows you to define, enforce, and report usage-based metering in your product without code changes. Plan management allows you to update plans, bundle and unbundle features, offer add-ons, support custom config, handle exceptions, which we refer to overrides. Company profiles are increasingly being adopted by our customers as their admin panel because by aggregating billing and usage context in one place, it's very easy to manage customers, their plans, and their pricing. And of course, we've invested a lot in the developer experience along the way. So low latency, high, high availability, and highly secure. The response that we've gotten to components from our launch a couple weeks ago has just been incredibly energizing. We've always believed that it should be really easy for product and engineering teams to manage pricing and packaging end to end. And that's from feature delivery all the way through end user experience. In Q4, we're focused on several key themes. Getting to self-serve onboarding and trialing with improved developer experience and SDK support for React and Next.js. Number 2, launching our, launching more components and supporting more pricing models. And number 3, growing our podcast and earning more media. We're incredibly grateful to all of you for participating in the journey, for your feedback, for your critique, for your feature requests. We're in the early innings for sure. We have a lot of product to build and a lot of execution ahead. Thank you so much for your support, your feedback, and all the energy that goes into getting a company from zero to one.