Recurly was born from the changing needs of web services. With the industry’s movement away from ad-based revenue models to Freemium and SaaS subscription models, the need for subscription billing has exploded.  We’ve had experience with some of the larger swiss-army-knife billing systems as well as building systems from scratch. Neither option was close to ideal. Both take an incredibly long time to set up correctly and more time to maintain. Both weigh heaving on engineering resources that could be better spent on building features. The exiting billing solutions also and an extra sting to the time needed to integrate billing- they were prohibitively expensive.

With so many startups wrestling with the challenge of subscription billing, we felt it was time to offer some help. This is why we created Recurly.

As fellow developers ourselves, we’re looking forward to helping get you up and running quickly, and taking the pain out of subscriptions. Let us show you how. Thanks and we’re looking forward to what the future holds!

One of the things most vexing and costly concepts for new businesses are “chargebacks”. Chargebacks are when a customer’s banks forcibly requests a return of funds. In a nutshell,  its when bank is the one asking for a refund vs. a customer to business transaction. What’s the big deal about this? Well, it’s  a bad thing for multiple reasons.

Each Chargeback returns the amount that was transacted, plus a fee from your payment processor (which varies from provider to provider). It’s not uncommon for each chargeback cost to reach up to $30 each. These obviously directly impact your revenue and with their random nature, it inhibits your ability to accurately forecast revenue. Even worse, if you have  lot of chargebacks, your merchant account provider can suspend, or even cancel your account. If this is the only way you get revenue, you could find yourself without a way to bill customers.

How can you best prevent chargebacks? The easiest way is to provide your customers an easy way to contact you regarding billing questions. Refunds are one of the most common types of chargebacks and by providing your customers with an easy way to contact you regarding a refund, you can avoid having to pay to avoid the chargeback fees.  By quickly responding to refund requests, you save your company the cost and the risk of handling additional chargebacks that could be avoided.

Another way to prevent fraud-based chargebacks is by requesting the “CVV2″ numbers, which provide another way to ensure the credit card number you’re transacting is correct.

A clear terms of service on your site also helps as it makes it clear what services your offering, and when a customer is entitled to a refund.

These are just a few ways to avoid chargebacks. For some other helpful tips, the 37 signals team has a great post on their approach to avoid chargebacks.