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So far Libby Tucker has created 3 blog entries.

What is usage-based billing?

Usage-Based Billing

Explaining the new billing paradigm and what it means for you

When you’re thirsty, you might go over to a faucet and turn on the water, which your house’s water meter conveniently tracks. At the end of the month, the water company bills based on the usage data from your water meter. The process is frictionless, and it makes sense–for the consumer and the water company.

This convenience gets to the heart of usage-based billing: pricing and payments based upon communicating usage data instead of a fixed price in dollars and cents. Until recently, most SaaS businesses didn’t have access to the metering tools required to implement usage-based monetization–even when customers preferred it.

Think about it through the lens of an Uber or Lyft customer. When passengers ride in their drivers’ cars to their destination, the ride-sharing apps conveniently track the distance and duration of their trips. Now, customers expect the same convenience from SaaS.

“Firms are shifting from one-time perpetual sales or fixed monthly subscriptions to consumption models that blend one time, subscription, and usage-based billing.” – Forrester Wave

The industry’s shift toward usage-based billing may even eclipse the decade-long move toward fixed subscriptions. It isn’t all sunshine and roses, however, as you consider the difficulties SaaS companies face in responding to this new trend in customer demand.

Challenges of usage-based billing

For one, you can’t just install an equivalent “water meter” in every business. Building a usage-based billing system requires time and money, and often involves revaluating how and where your company provides value.

In SaaS, for example, it can take a developer weeks or months to build a way to track usage data and bill for it. I would know–my team and I did that for more than 25 revenue-generating companies at Sproutbox. That was time our business wasn’t able to focus on building our core products, and it resulted in delays getting to market. Even worse, anytime we wanted to change pricing, developers would have to spend hours in our pricing meetings.

Perks of usage-based billing

A usage-based billing platform isolates pricing from your code base and empowers you to flexibility change pricing. Executives and marketing leaders can customize and test pricing in real-time without burdening development teams or waiting on releases.

Building a billing system centered around usage data is also significantly easier than traditional billing and payment systems. It’s simple–you just outline what items the development team needs to track, and the usage-based billing system does the rest. Pricing, payment processing, collections, customer communication, revenue optimization, and SaaS reporting all come out of the box.

Usage-based billing also allows businesses to help identify where they provide value and match variable costs with variable pricing. This can be a huge help to new companies, allowing them to let initial usage tracking data influence pricing decisions from day one.

Consumers and billing

Saving time, saving money, and adding flexibility to your pricing is great, but above all, one of the biggest benefits of making the switch to usage-based billing is that customers will love you for it. They are the ones driving this billing evolution because it means they get fair, transparent pricing that’s more aligned with the value they receive.

And that’s how billing should be.

About Cheddar

Billing built for developers. Using a unique usage-based approach to billing, we cut the time it takes to build monetization into a product by as much as 90%. No matter if your billing model is metered, one-time, subscription, or some combination, Cheddar allows you to focus on building awesome products, not billing for them. Sign-up for a free developer account.

What is usage-based billing? 2018-02-08T05:09:09+00:00

Cheddar’s funding and what it means for Bloomington

Trends in Midwest Tech 

Below is a brief guest column Mike Trotzke, CEO of Cheddar, wrote for Bloomington’s local newspaper, The Herald Times.

From limestone quarries and furniture factories to Indiana University and Cook Group, Bloomington’s economy has had a variety of drivers over the years. Now, we see hints of what may shape Bloomington’s next phase of economic success– and it comes from technology companies.

Our billing software company, Cheddar, recently raised $1.25 million from investors to launch into high-growth mode. You might say, “Big deal — that’s just one, small company.” But, Cheddar’s success isn’t isolated. The financing is a result of two trends shaping our economic landscape– budding technology startups here in Bloomington and an increasing number of Midwestern investors with the experience to support them.

Over the last decade, Bloomington has quietly built 20–30 small, high-growth companies, many similar in potential to Cheddar. Technology startups like Periodic, Mavenly, or Bee Corp have remained low in headcount, focusing their attention on refining products to be sold all over the world. Unlike typical service or manufacturing businesses that might steadily grow over the course of their lifetime, technology startups tend to mature at rates relative to their funding. Online software, once dialed in, becomes significantly easier to scale than physical goods or services.

The second trend shaping Bloomington is the rise of Midwest venture capital funds wanting to invest in high-growth companies. Just five years ago, Cheddar would have had to take a long shot in places like San Francisco with investors that had little incentive to invest outside of their area. Now, Bloomington companies can drive to Chicago, Cincinnati, St. Louis and other Midwestern cities to secure investment from firms like M25 Group and Connetic Ventures.

Combined, these two trends catalyze economic opportunity. Indianapolis is a prime example of an economy invigorated by startups and investors. Over the last few years, Indy’s technology sector has brought money into its city, created thousands of technology jobs at triple the rate of the national average, and propelled the capital forward. It’s easy to see the shift driving through downtown Indianapolis– their tallest building was recently renamed to “Salesforce Tower” to represent one of the city’s largest technology companies. Salesforce now employs over 1,000 people with plans to add 800 more over the next few years.

Cheddar’s funding could mark a turning point towards similar economic diversity here in Bloomington, but it will take support from the community. We should not try to be Silicon Valley or Indianapolis, but Bloomington should leverage these trends to enhance our unique, creative culture, strengthen our nonprofits and grow local business. The investment in Cheddar was one of the first times that a local technology company received funding from venture capitalists outside of our state, and that means a lot more than just cash flowing into Cheddar. Outside investors will visit the city to monitor companies, ask about other investment opportunities, and begin to invest in more of our startups.

Cheddar has high aspirations. It may or may not reach its full potential. Regardless, investing in high-growth Bloomington companies means investing in the future of Bloomington’s economy, jobs, and community, making our city more sustainable and ensuring it continues to be a great place to work, play, and raise families.

That’s good for all of us.

Mike Trotzke is CEO at Cheddar and a Cofounder of SproutBox.

Cheddar’s funding and what it means for Bloomington 2018-02-08T05:16:14+00:00

How we did it: Responsive Email Design

How we did it: Responsive Email Design

Next week, we’ll be launching a brand new set of default email templates for CheddarGetter. We learned a ton about coding and designing responsive and highly-deliverable emails through the process.

From the get-go, we had a few goals for the new templates in mind:

  • High Deliverability
    We didn’t want these transactional emails ending up in spam.
  • Responsive Design
    We wanted the new templates to look great on every device.
  • Ease of Customization
    We wanted our customers to be able to customize the templates while still maintaining responsiveness and deliverability.

A basic responsive structure

You’d think accomplishing these goals would be pretty straightforward. Unfortunately, coding emails is hard. We knew we wanted to create something mobile-first, but we weren’t quite sure what the best practices were or where to get started. THANK GOODNESS there are awesome resources out there. We really liked the mobile-first, single column approach we found here. Since notifications we send are transactional emails, not visually dynamic marketing emails, a single column structure works really well. It also makes editing the content a little less complicated.

According to FogCreek’s approach, our single column email should scale to fit smaller screens, but it shouldn’t get too wide to read in desktop clients. A max-width table does a pretty good job of restricting the email’s width in most email clients, but, as is often the case with emails, there are a few clients that don’t support this property: Apple Mail, Outlook, and Lotus Notes.

Apple Mail

While Apple Mail doesn’t support “max-width,” it is one of the few email clients that supports media queries. By creating a style tag in the head and inserting this media query,

@media only screen and (min-width: 541px) {
  .cheddar-content {
    width: 540px !important;

we can restrict the .cheddar-content table to 540px wide if the window is greater than 541px wide.

Outlook and Lotus Notes

Neither Outlook nor Lotus Notes 8 support the “max-width” property. Luckily, these rogue clients are mostly used to view emails from desktop computers, so we don’t need to be as concerned with responsiveness here. A fixed-width table does the trick. We’re applying a few conditionals: (IE) covers Lotus Notes and earlier versions of Outlook, while (gte mso 9) covers Outlook 2007+. There’s also an identical conditional in the footer of the default notifications that contains all the close tags for this table.

<!--[if (gte mso 9)|(IE)]>
  <table width="540" align="center" cellpadding="0" cellspacing="0" border="0">

The right <head> for the job

Now that we’ve gotten the basic responsive structure out of the way, let’s take a look at the email head. There are several differing opinions about the best DOCTYPE, HTML attributes, and meta tags to use in your emails. Below, we’re listing the ones we’ve chosen to use and why. If you’d like to learn more about email boilerplating, you can check out this interesting discussion on the Litmus community forum.

<!DOCTYPE html>

We’ve chosen HTML5 as our DOCTYPE. This DOCTYPE tells the browser/email client to render the layout in standards mode, not quirks mode, and it’s required for standards validation. It is technically experimental, but in email testing and W3C validation, we haven’t run into any issues.

<meta http-equiv="Content-Type" content="text/html; charset=utf-8" />

The Content-Type meta tag is what controls the display of different character sets. Usually you’ll want to use utf-8.

How we did it: Responsive Email Design 2018-02-12T18:59:57+00:00