Subscription Billing
Subscription billing is the system that manages recurring charges, plan changes, prorations, invoicing, payment collection, and subscription lifecycle events. It is the critical infrastructure that converts product usage into collected revenue — automatically and accurately.
Saved Annually
Through billing automation at BatchService
Why Subscription Billing Matters for SaaS Companies
Your billing system touches every dollar of revenue. A poorly configured system leaks revenue through proration errors, failed upgrade processing, missed invoices, and incorrect tax calculations. For Seed to Series B companies, billing system choices made early become deeply embedded and expensive to change later.
An Operator's Take
I have seen companies manually generate invoices for enterprise customers, calculate prorations on spreadsheets, and track subscription changes in Notion. This works at 20 customers. It breaks catastrophically at 200. At BatchService, manual billing processes consumed 540 hours annually — an entire headcount worth of time. We automated everything: subscription creation, plan changes with automatic proration, invoice generation, payment collection, and dunning. Those 540 hours went back to the team for revenue-generating activities.
Common Mistakes
What I see go wrong at Seed to Series B companies.
Choosing a billing system based only on cost. The cheapest option often lacks the flexibility to handle plan changes, prorations, and enterprise contracts — leading to manual workarounds.
Not handling prorations correctly. When a customer upgrades mid-cycle, they should be charged the difference. Most billing errors happen in proration logic.
Building billing logic in-house. Unless billing is your core product, use established platforms (Stripe Billing, Chargebee, Recurly). The edge cases in billing are endless.
What to Do This Week
Concrete steps you can take right now.
Audit your current billing for manual processes: invoice generation, proration calculations, plan change handling. Each manual step is a leakage risk.
Test your billing system's proration handling: upgrade, downgrade, and cancel mid-cycle. Verify the calculations are correct.
If you are spending more than 5 hours per week on billing-related tasks, evaluate automation platforms.
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Frequently Asked Questions
What billing platform should a SaaS company use?
Stripe Billing is the default choice for most Seed-B companies: excellent API, strong dunning, and scales well. Chargebee and Recurly offer more subscription management features out of the box. For complex enterprise billing (CPQ, multi-product, usage-based), Zuora or custom solutions may be needed. Match the platform to your billing complexity — do not over-engineer early.
Need Help With Billing Automation?
Most Seed to Series B companies are leaving money on the table. Let's figure out where.