Lago

Why did the airline introduce "dynamic pricing"? Because our seats*, in the back, boarding group 5️⃣**, shouldn't cost the same as the "prime real estate" near the bathrooms 🚽 ***. *37C and 37B, but Raffi Sarkissian generously offered me the window seat 🤗 (best co-founder!) ** I also recently learnt you could be group 6️⃣ with United Airlines, love, love, LOVE, US domestic flights! 🤯 *** If you have already paid more to hear each flush 💦 🥜 during your flight, I'd love to understand the decision process and satisfy my intellectual and human curiosity 🕵🏻♀️ -- Joke aside, dynamic pricing is a powerful strategy that enables companies to optimize price based on market conditions. For instance: - Offer and demand: Uber surge prices, Airbnbs etc - Cost of servicing: * If you're an AI company that uses different providers under the hood: Mistral or OpenAI depending on circumstances, and/or different models (with varying costs), you'd like to charge a different price. * Same if you're a Telco (or MVNO, or CPaSS, eSim provider) and you're re-selling communication services that you bought to different providers yourself * Same for... Fintechs, that often rely on banking rails they need to pay / lease to incumbents... ... the applications are endless. The good news are: 1️⃣ You should probably give it a try... 2️⃣ ...figuring out the right pricing is an ongoing work, and the market and your product will keep evolving, so prices are bound to be "living organisms"... 3️⃣ ...it's not trivial to implement dynamic pricing and a flexible revenue infrastructure, but Lago abstracts this complexity for you. Focus on what you do best! And yes, while I was stuck waiting to board (group 6!) on a UA flight, Raffi Sarkissian and the team shipped a great demo video, updated our slick product documentation (links in the comments). We're happy to demo this personally to you, anytime!

** Lago = Compound startup -> Open Revenue Hub ** One perk of being a founder is repeating the same vision over and over again (and loving it!) cc Raffi Sarkissian 🙃 Here we go ☀️ again! "Billing is a huge market in itself... ... however the most interesting things about being the billing system... ... is the data that we produce and understand better than anyone else: usage, payments, upgrades/downgrades/expansion data... ... the RevOps stack is still messy and to solve for it (analytics, workflows) you need access and a very granular understanding of the billing data." Building a Compound Startup, while adopting an open-source approach (sharing more details in the comments) have been our intention from day 1. All this to say, we are SO excited to welcome our first *Maching Learning engineer*, we've been working on analytics and data features already but it's taking a whole new dimension now with Iavor Botev! Iavor brings more than 10+ years of experience in his field, spanning from being a quant in a top asset management fund, to leading Maching Learning and Data Science in several Fintechs. He's from beautiful Bulgaria (very underrated European destination IMHO). 3 fun facts about Iavor Botev: - He solo-traveled across the world for 6 months visiting a different country every 1-2 weeks. He still hasn’t been to South America though… - He lived for almost 10 years in Amsterdam and is now back in his home country of Bulgaria where he enjoys both eating and cooking the amazing local cuisine. - He can’t imagine a life without sports and he goes to the gym, runs, and plays racket sports like squash and tennis. Welcome Iavor, and let's ship data products, and play 🎾 together soon!

AI is expensive and… Speed is key! Lago enables leading AI companies (Together AI Mistral AI Groq BentoML Cerebrium) to monetize, iterate on pricing and maximize cash collection. Each company and products are unique and the approach should be customized. For the rest, we recommend the following caveat and offer an off the shelf solution for it: 1️⃣ Send usage in real-time 2️⃣ Aggregate it and price it 3️⃣ Set up plans 4️⃣ Use prepaid credits for better spend visibility 5️⃣ Maximize cash collection with progressive billing

We'll never forget our first users, especially our first open-source users!!! Two years ago we opened Lago repository on Github: we did not have much to show, I remember our billing API didn't even offer "coupons" :) *However* we attracted our first community members who believed in our vision and started giving us inputs and energy to keep building, having even 1000 Github stars (we're at 6,000+ today, the #1 in this field), or having enterprises using Lago was a distant dream (we got there as well!). We've never met Yuliia Butovchenko and Jannik Malte Meissner in-person, until Tuesday at SF Techweek, but it didn't take long for the team to recognize them! Raffi Sarkissian Mathieu Déjean They're building Neuralfinity: if you're interested in the pre-training of custom LLM models, ping them :) We're genuinely super grateful and are planning to double down on our community (we're always hiring!!!) in the near future 😉 Stay tuned! And shout out to our team at Lago, who make sure we provided thoughtful and quick answers to our 1600+ members on Slack as well: Jérémy Denquin Toon Willems Brian Vu!!!

Groq with a Q! I love how this company is painted as an overnight success, when their success has been an 8-year journey, fueled by a ton of resilience, passion, and « showing up no matter what » (and their very humble team would still say it’s really only the beginning). What do they do? - LPU (language processing unit) inference engine. Their LPUs can run existing generative AI models similar in architecture to OpenAI’s ChatGPT and GPT-4o at 10x the speed and one-tenth the energy. They are known to be the challengers of Nvidia.  - They offer also offer « custom chips for AI workloads in the cloud »: GroqCloud. As of July, GroqCloud had more than 356,000 developers. - The company has been valued at more than $2.8B in their recent funding round announced a few months ago. We’re honored to serve such a brilliant and ambitious team!

I'm not a mom, and I don't know a thing about kids, but I know this is *exactly* how I'd explain MRR to them. 🥲 As I don't have kids, maybe we should use these analogies for Lago boards Raffi Sarkissian? Thanks Dave Kellogg for the laugh, and Victor Mithouard for sharing!!!

Y Combinator doesn't stop after YC ! (or doesn't even start with the batch) Might sound kind of « cliché » but a lot of people think it’s about the 3-month batch + demo-day, it’s not: 1️⃣ Pre-YC My « YC journey » started as an employee of Weebly (YC W07 - the batches were 20-ish companies at the time?!). I barely knew what YC was, being a founder was on my mind but a distant ‘dream’ and a few years later David Rusenko was generous enough (Thanks again!) to recommend our application with Lago! I’ve also met Lyle Fong who’s been a visiting partner at YC. The headhunting firm his VC fund (at the time) was using reached out to me... I said « I might take the VC route when I am older 👵, but I still have SO MUCH energy now, I want to take a shot at building ». And then Lyle coached us with our YC application, interview, even our pivot, and to date is our biggest individual angel investor. (Raffi Sarkissian and I are SO grateful!) 2️⃣ Post-YC - Office hours Founders can still book « office hours » with any partners after the batch. We do it quarterly with Nicolas Dessaigne. During the batch we mainly talked about « product market fit », now our latest topics have been more around: org design, sales repeatability… and mental health, sprinkled with a little bit of "fundraising strategy". - Community Building is super lonely and being surrounded and inspired by people who have been through or are going through the same challenges as you is very unique.  My « YC sibling » is another female founder, building an open-source fintech, out of Paris, who was in the same YC batch, what were the odds :) Anne-Sybille Pradelles! I bumped into another open-source founder in my building in San Francisco (👋 Advait Ruia who also recently moved to the Bay Area), it also happened at the pickleball court (Pritika Mehta) or at the banh mi stand ^^ (Tony D. Vlad Matsiiako 🇺🇦) and now we take walks at the Embarcadero and try to become « accountability partners » on new things we want to try: either something personal such as a new sport/hobby or a new initiative within the company. I’ve also created the « YC Fintech » community (600+ amazing founders at all stages, thanks Matthew Smith - partner in crime) where deep industry-specific convos happen. There’s also « YC CEOs » / San Francisco / France…. « YC Surf » (of course!) and… « YC Padel » (don’t we look good here?) Antonio Sierra , thanks again, such a great event at Bay Padel!!! - Insights under the "Chatham house rule" YC often organizes events (the YC alumni week this week, but also throughout the year) and I can’t praise « bookface » knowledge base enough for all the insights we get to ingest in such a short amount of time.  We also have the « off the record » rule that makes sharing much more genuine refreshing and… impactful! PS: Who wants to play Padel in the Bay Area? Bonus for female players 🙈😅

Product Update #37 🚀 We’re super excited to spotlight 2 of our latest features, pushing the boundaries of billing with marketplaces integrations and progressive billing. 💥 Progressive billing 💥 Progressive billing, also known as threshold billing, automatically triggers an invoice when a customer’s cumulative usage reaches predefined thresholds. No more waiting, no more surprises — just timely, fair, and secure billing that grows with your customers. With progressive/threshold billing, say goodbye to unpaid bills and billing 💰 Marketplaces integrations 💰 Effortlessly distribute products through the three major cloud marketplaces: Amazon Web Services, Google Cloud Marketplace, and Microsoft Azure Marketplace through native integration with our partner Suger. This integration lets users track usage within their existing Lago setup and allocate it across various cloud marketplaces. Specifically, users can: - list their products on the marketplaces in minutes - transact and co-sell on the marketplaces - have a separate and automated reporting of marketplace billing metrics Stay tuned for more exciting updates!

LEARNINGS from working with top AI companies (including Mistral and Groq)? For many SaaS applications, if a user doesn’t pay, it’s not a big deal. Sure, that implies that they are churning, which translates to lost revenue, but the cost of the service was likely minimal. However, AI is expensive. If a user racks up a massive AI bill and doesn’t pay, it's a real problem. Thankfully, there are a few pricing models that mitigate this risk. We support leading AI cos with implementing the relevant pricing systems from day 1 at Lago, for instance: 1️⃣ Prepayment The obvious solution to a customer not paying is to request prepayment. If users pre-purchased tokens (or whatever unit) in advance, there is no risk of a lack of payment. The credits are just consumed over time. This creates a new challenge, however. Customer accounts cannot just grind to a halt if credits are exhausted. That would be punishing the best users. Rather, companies need to automatically top-up credits whenever they run dry or tolerate some level of negative balances. 2️⃣ Threshold charging The other solution is to bill customers whenever usage crosses a reasonable threshold. For instance, if a company can tolerate a $5,000 loss, then they can bill the client whenever they reach $2,500 in costs. If they reach another $2,500 tranche without paying the last invoice, then service can be cut-off. This is particularly reasonable if the payment method is set to auto-pay. While this does introduce some risk, it may be preferred over prepayment if there are concerns that prepayment will negatively impact sales. It also transparently provides the customer with a reminder of their spending rate. ⚠ There is a complication with this strategy, however. Some customers may reach the billing threshold really slowly. Hypothetically, some might never reach it. To address this, customers should still be billed at a monthly (or yearly) cadence. That way, their balance is wiped out, restarting the cycle. 3️⃣ Spending minimums Sometimes, metered pricing may also have spending minimums. This is independent of a subscription tier—the minimum is applied to units (e.g. tokens) used. For example, if the minimum is 5M tokens / month, and the user only used 3M tokens last month, then they’ll still be charged for the full 5M. Spending minimums might often equal one base unit. For instance, if the rate is $5.00 / 1M tokens, and 1M tokens was the minimum, then any value below a single base unit (e.g. 800K tokens) would round up. 4️⃣ Enterprise contracts AI companies often offer enterprise contracts with negotiated prices. This rises the need to tailor prices, thresholds, and packages for each individual enterprise customer. This personalization can sometimes be expensive; maintaining unique pricing for each contract naturally leads to a bigger administrative overhead. It also mandates for a more flexible billing system to account for the variations.

Our daily fuel with Raffi Sarkissian is to work with brilliant and ambitious people: team members at Lago for sure 🫶, but it's also such a huge pleasure to see our users crushing it like this! Together AI Open-Source, and Together AI for the win! ✨🔥🙌