Lago helps companies of all stages with composable and effortless metering and billing

Companies across all industries are shifting from charging per user to charging based on usage. Sixty-one percent of SaaS companies said they either have usage-based pricing or are actively testing it. This number is expected to grow with the advent of automation and AI, as monetization can no longer be tied to human users of a product. The decline of per-seat billing and the complexity of emerging hybrid models are creating significant friction for billing teams.

Lago is the open source leader that specializes in metering and billing for developers to address all their billing needs, as well as finance teams to have access to clean data for their tasks. Lago is suitable for even the most complex pricing and billing needs. In addition to being open source, Lago describes its offering as a self-hosted and cloud, scalable, and modular architecture for metering and usage-based billing. 

Today we’re pleased to announce we led the seed investment in Lago. We got connected to Anh-Tho Chuong, the founder of Lago, twice. Our first connection: carbs. I posted a tweet about American bread vs. European bread, and Anh-Tho liked the tweet—our talk started there. Meanwhile, SignalFire reached out to Lago via Nico Dessaigne at YC because our proprietary data platform, Beacon AI, detected an uptick for Lago in the open-source repository. We met Anh-Tho in person and she picked us to partner with her as a lead for the seed round.

“After pivoting and having the early user traction, we knew we'd built in open source/dev tooling and have been on the look for partners/investors who understood seed and this space deeply, and SF ticked all the boxes.”

—Anh-Tho, CEO of Lago

‎Composable metering and billing 

Customers worldwide appreciate Lago's metering solution for its seamless plug-and-play functionality. They can simply connect their data sources to Lago without the need for pre-aggregation or data cleaning; Lago handles everything effortlessly. Lago also provides an out-of-the-box billing system, along with a top-tier API for engineers and a meticulously designed user interface for business teams. This includes features for managing subscriptions, calculating usage, handling billing cycles, managing dates, currencies, and more.

Open source is Lago’s superpower

Lago is open source. Engineers can inspect the code and test it on their own. It’s also easier to build on top of and extend. And you can use Lago for specific use cases in conjunction with existing platforms. During our due diligence period, we also connected with off-list references, speaking with engineers following Lago’s repo on GitHub. Below are some of the quotes that only increased our enthusiasm to invest.

“We previously rolled our own solution with just Stripe around a year ago but found it too rigid when it came to dealing with enterprise contracts. When looking for other solutions, we chose Lago because open source meant we could put our full trust in the solution despite being a young company. If something ever happened to Lago, our billing system will not be affected.

“We also found open source attractive since it lets us plug our own payment providers. Stripe covers most use cases, but there are situations where we don't want to be constrained to Stripe for our billing.”

—A Lago repo follower 

“Lago has a clean architecture that makes this easy to plugin into existing applications. Additionally, we are looking to use a self-hosted option due to regulatory requirements. We may not use Lago if it doesn't scale well.

“It's extremely important for us to have Lago to be open source.
Self Hosting is extremely important for us and we will self host only Popular Open Source solutions.

This is also the reason for not picking other popular solutions.
“Overall, I am very impressed with the work that the Lago team has done and would hope that you go ahead with the investment.”

—A Lago repo follower 

We backed Lago for their rigorous product that has won the minds and hearts of developers, but also for who the founding team of Lago is. It was known that Anh-Tho, Raffi Sarkissian, and team had built a homemade billing system before at Qonto, and it has remained clear how resilient and hard-charging this founding team is.