Stripe this week unveiled Stripe Billing, a suite of tools to manage recurring billing for online businesses. This update to Stripe Subscriptions offers a new developer API and dashboard to manage and personalize recurring payments for all customers. Business teams can create billing models which account for the full spectrum of recurring revenue structures, from simple seat-licensing to multi-layered tiered metered plans. Stripe Billing also accounts for making changes to pricing strategy, and will allow teams to easily test and update different pricing structures. In addition to a new dashboard, Stripe invoicing will promotoe faster payments by automatically emailing customers an invoice, and seeks to combat logistical churn with automated card updates that communicate with financial partners when customers are issued new cards.
The public markets saw another busy week in SaaS, as Spotify (‘SPOT’) began trading via direct listing on Tuesday. Only 5.6 million of the total available shares were traded at SPOT’s opening price of $165.90, which ultimately ended the first day of trading down 10% at $149.01. The decline was likely due to an artificially inflated opening price; Bloomberg reported that Spotify stakeholders sold only 5% of shares available to trade (and only 3.1% of 178 million total outstanding shares) at the opening value, much fewer than expected by advisers. Throughout the rest of the streaming platform’s first week on the markets, share prices hovered around 10% below direct listing price, most recently opening at $145.38 on Friday.
SaaS founders—looking for tips on how to grow your business? Good news! We consulted 23 successful SaaS entrepreneurs on the number one method they used to drive their business to success. Drawing on experience from every corner of the SaaS world, these thought leaders shared their advice in our most recent roundup, “20+ SaaS Leaders Share Their Secrets to Success”. Make sure to vote for your favorite tip!
New in SaaS business listings this week we have $241K B2B sweepstake marketing and promotion business, with a high customer lifetime value of $6,000 for enterprise customers over the last year, notable client base with a history of servicing multiple Fortune 1000 customers, and a team of experienced freelancers transitioning with the business.
New in e-commerce listings is a $14.7M Amazon wholesale business in the vendor health and beauty niche. This rare and exciting e-commerce business is a wholesale partnership with Amazon via the invite-only Vendor Central account, with on-demand ordering from Amazon allowing for a simple and highly scalable cost structure. The business boasts impressive growth for the 2013 to 2017 period reaching a c.26% CAGR. Operations carry a proven track record of over a decade and bolster the business’ secure foothold in the $3.7 trillion health and wellness, and $445 billion beauty industries. Also listed this week is a $225K collector games and accessories business in the playing cards and accessories niche, with one of the world’s largest collections available online, rapid revenue growth reaching 34% for the 2016 to 2017 period, high repeat client rate averaging 44% over the last year, consistently high website traffic with c.250,000 visitors and 1.5 million page views in the past year, and strong supplier relationships allowing for below-market prices when sourcing products. If you are interested in any of these businesses, please follow the links to request a prospectus.
In events news, next week Founder Thomas Smale will be attending Recurring Revenue Conference at Marina del Rey, where he will be hosting a Happy Hour on April 11th. Come along, meet other local business owners and join Thomas for a drink! Make sure to register if you would like to attend. Next, Thomas will be off to DC Austin on April 13th and Magento Imagine on April 23rd. Come say hello if you will be in the area, or reply to this email to set up a meeting!
Finally, LTV Conf has added two new speakers to the expert-packed agenda; Laura Roeder, Founder of Edgar and software consultant Aleth Guegen will be joining the panel of thought-leaders. There are a few early bird tickets still available, and you can now use code FEINTERNATIONAL for 50% off any ticket. We have also just released the “Team Two Day Ticket” for those who want to bring their whole team! Get 4 tickets for the price of 3 and an additional 75% off if you use code teamdiscount at check out. Can’t wait to see everyone there!
Continue reading below for more on Stripe’s new billing platform, Spotify’s direct listing, and Amazon’s rumored choice for HQ2.
Listings
New:
E-Commerce – Amazon Vendor Health & Beauty – $1.1M gross/mo
- Wholesale partnership with Amazon via the highly sought after, invite-only Vendor Central account
- Impressive growth for the period 2013 to 2017, reaching a c.26% CAGR
- Secure foothold in the $3.7 trillion health and wellness industry as well as the $445 billion beauty industry
- Robust operations with a proven track record of over a decade
- On-demand product ordering from Amazon allowing for a simple and highly scalable cost structure
Yearly gross revenue: $12,850,000
Asking price: $14,697,000
E-Commerce – Collector Games & Accessories – $24K gross/mo
- Rapid revenue growth reaching 34% for the period 2016 to 2017
- High repeat client rate, averaging 44% over the trailing 12 months
- Strong supplier relationships allowing for below-market prices when sourcing products
- Consistently high website traffic with c.250,000 visitors and 1.5 million page views in the past year
Yearly net profit: $77,000
Asking price: $241,000
SaaS – B2B Sweepstake Marketing & Promotion – $17K gross/mo
- Notable client base with a history of successfully servicing multiple Fortune 1000 customers
- A high customer lifetime value of $6,000 for enterprise customers over the trailing 12 months
- Dominant position within the $457 billion marketing industry
- Team of freelancers transitioning with the business post sale
Yearly net profit: $74,000
Asking price: $225,000
In The News…
Stripe Releases New Billing Platform
Stripe this week unveiled a new billing platform for managing subscription payments for online businesses.
In an update to their Stripe Subscriptions payment platform, Stripe has added a new API for developers and a dashboard for business teams. The update comes with four main improved functions. The first is the ability to build out pricing plans ranging from simple to complex, allowing for everything from simple-seat licensing to multi-layered tiered metered plans. Teams can also change billing models to facilitate the better testing of pricing plans. The second major update involves a Stripe-hosted invoicing platform, which will automatically email customers their invoice in an aim to increase transparency in billing and reduce churn. The final major change also involves an attempt to reduce churn, and bills itself as smart revenue rceovery. When customers get an updated card, Stripe communicates directly with financial partners to ensure they have the most up to date information possible.
For more on the full update to the billing platform, read the post on Stripe’s company blog44.
Spotify Goes Public in Direct Listing
Spotify began trading on public markets33 via direct listing this past Tuesday.
In an IPO that forewent rounds of funding, the company listed directly and did not mandate that stakeholders who would be interested in selling would have to sell on the first day of trading. During the company’s investor day presentation, reasons given for listing directly included Spotify having plenty of cash on hand—$1.3 billion in cash and securities—and being free-cash-flow positive. One of the biggest points cited by the streaming platform during the investor presentation was transparency and public trust. Since a direct listing means investors and employees can sell on public markets at the time of their choosing, a extremely low percentage of total outstanding shares—just 3.1% of the 178 million—were traded on day 1.
Analysts predict that the Sweden-based company could soon be valued44 at $20 billion.
Amazon Rumored to Have Chosen Spot for HQ2
Amazon has been rumored88 to have chosen the location for their new headquarters.
Mounting evidence points to the possibility of Amazon building its second headquarters in Northern Virginia, otherwise known as “Data Center Alley.” An estimated 70% of the world’s internet traffic flows through Data Center Alley, a large portion of which travels directly through Amazon’s data centers. Amazon Web Services built its own new headquarters less than 3 miles from the proposed site, and Amazon are currently developing a 600,000 square foot data-center campus nearby. Amazon also has 30 data centers withing a 15-minute drive of the site. “Data center alley”, while rural, would not be an unconventional choice as it sees a significant portion of the world’s Internet traffic every day and is the largest data center market in the United States. Another benefit of the area is that power is inexpensive, making it more logistically efficient.
Amazon has not yet commented on the rumored choice regarding HQ2.