Farewell Kagi | Hacker News Reader

Farewell Kagi

kagi.com

114 pointsnicky060 comments

For those who didn't know about Kagi, from an archived version of their site:

Welcome to Kagi. We provide the technology that makes it easy for you to open and operate your online store, so you have time to focus on managing your business. We offer a complete range of store solutions, including order pages, shopping carts and payment processing—all tailored to fit your needs. We give you the keys that unlock your online store's potential.

Kagi was 22 years in business and they write this:

> We are sorry we failed you.

Kagi, you did not fail. You provide an essential service for what was then called Shareware when it was really hard to do online payment processing.

I think perhaps that getting defrauded so much money that it sent them bankrupt must feel a bit like failure to them

I used Kagi as a customer (never a vendor) many times in the late 90s and early 2000s and have a lot of appreciation for what they brought to the Mac shareware scene. But I would consider it a failure to shut down an established business with what seems to be absolutely no notice (see other comments here and on Twitter).

As I posted on the other, stillborn, HN thread[1] about this:

I had been selling through these guys continuously for the past 19 years. Back when I set Kagi up to handle sales of my apps for Newton OS (1997), they were one of only a few companies offering that kind of thing, and were a familiar name to anybody who bought shareware back then.

But, for me, well, I guess the Newton OS gravy train[2] is finally over! :-/

It's interesting to me that I set up that store in 1997, and it ran untouched for years after that, generating a decreasing modicum of sales, every year, until today.

[1]: https://news.ycombinator.com/item?id=12200601 [2]: http://www.fivespeedsoftware.com

Wow, people were still actively using Newtons? AND spending money in it's ecosystem? Well, will wonders never cease. That's incredible. I guess some folks stick with the things they like when they find them. More power to them!

> AND spending money in it's ecosystem?

Well, it is an Apple product.

Perhaps a phoenix-type situation is in order. I'm surprised when anything works for more than a year without incident, these days.

This is very sad... When I was 16 ('97), I sold my first Mac shareware tools and games through them. I still remember my dad asking me why someone was sending me checks in US dollars (I'm from Chile). His face got only weirder when I told him: "internet stuff, dad... I'm selling stuff through internet".

That's too bad.

Kagi is not a name that comes up very often anymore, but they were a shareware payments processor. Back in the day, (90s!), charging credit cards was exceedingly difficult for small software businesses, so they essentially rented out a merchant account and (optionally) working shopping cart in exchange for 10%~15% of the transaction price.

There used to be many of these smaller payment processors. Most of the ones in the software space joined Digital River or went under.

Does anyone know what the fraud incident was that they reference? I couldn't find anything on Google and don't remember any news, either...

Same here. Especially the fact it happened 10 years ago and they are still paying the debt off.

From about 10+ years ago it seems something to do with Outpost.com? http://forums.macnn.com/79/developer-center/268919/unofficia... https://books.google.co.uk/books?id=zPU6DcS9MN0C&pg=PA22&lpg...

I am a current Kagi supplier, and this unexpected closure has me in a bad place. It took a few days to code my system to interface with theirs and to generate licenses automatically for each purchase. I suppose I need to redo all that.

I appreciate Kagi for their years of friendly and comprehensive service as well as the next person, but why didn't Kee Nethery support us better during the closure? No migration path to or even recommendation of a replacement. Where are others moving their payment processor to?

And it sounds like we may not get fully paid either.

If you don't mind do a bit of coding:

  * Stripe
  * PayPal. (You want the "Express Checkout" workflow)

(Hint: for increased sales offer both. Stripe is a developer's dream; adding PayPal adds perhaps 30% more sales, although YMMV)

If you want someone else to take care of all the details in return for higher commission:

  * FastSpring (full service, heavyweight)
  * Paddle (streamlined, focused towards Mac and towards digital products such as ebooks)
  * Gumroad (focused on info products)
  * SendOwl (you still need your own Stripe and/or PayPal, but you don't need to do the coding. They give you a polished, modern feature-rich UI on top of your payment processor.)

> Stripe is a developer's dream

Unless you're using the JVM. Their Java API is so awful that it feels like you're just shelling out to cURL.

Have you tried PayPal? Stripe's Java library may be a bit simplistic but at least the fundamental API concepts are sound.

(I'm a developer at Stripe who helps maintain our language bindings.)

+1. The original system was designed to be as flexible as possible and had the advantage of being able to support many different integrations that were straddling many different versions of the Stripe API, and all from within a single version of the Java library.

Its major downside of course is that the same flexibility somewhat compromises the developer experience, and the choice hasn't mapped well onto languages like Java where the expectation is that most functionality should be discoverable by the type system.

If it's any consolation, we're certainly aware of the problem and have a rough plan/roadmap on how to address some of the more appalling blemishes in usability.

I used Stripe's Java API for my website. I wouldn't say it was awful - it got the job done, and exception handling was well thought out. But it wasn't idiomatic Java. It felt like it had been put together by someone who knew a language other than Java really well.

No higher commission & no coding option:

* JotForm (+Stripe or +PayPal)

Depending on your situation, you might want to lean towards FastSpring or the other full services - from memory one of Kagi's value-adds was collecting the appropriate tax when selling to certain countries (ie collecting and remitting VAT when selling to customers in the EU).

[I'd actually recommend talking to FastSpring - they used to provide a concierge service to setup the order form for you, and they have a system where they can ping a licence key generator on your server (eg in PHP), much like what Kagi did. I'm happy to try to answer questions if you or anyone else gets stuck, contact details in my profile.]

Seconding this recommendation. I'm a Mac developer and sell shareware, but have very little web development experience. I switched from a (pretty thrown together) implementation using Paypal to Fastspring a few years ago, and the process could not have been smoother. Fastspring was super helpful getting me set up, and I had to do very little work to get my existing (PHP) license generator integrated with their system. I've been a satisfied customer ever since.

Just a warning: when some subscription-management service advertises they support PayPal Express Checkout/Payments Pro make sure to check the exact requirements.

Many require reference transactions support. Which requires PayPal approval, and (from what I understood from the person who actually talked with PayPal) they only give it after some revenue levels that aren't trivial to achieve if you're just starting and don't even have any sales yet.

When coding on their own, interfacing PayPal directly, one can avoid this requirement, settling for a somewhat more limited but still fairly functional set of EC APIs.

Full disclosure: I'm a payment processor.

Your best bet is Stripe in most cases. They have a robust API, and a simple payment scheme as far as handling interchange and fee structures. However, it makes sense to find someone like myself (a dev payment processor) when you fill two critera: 1) an average transaction size of $25 or greater, 2) a monthly transaction volume of over $5,000. Until both of those criteria are met, it makes more sense to process through Stripe or Square because their fees will be lower and there is more hand holding on the API side.

I board most of my business with Priority Payment Systems because they have an API that I like, with lots of documentation and good relationship managers. This is just my opinion based on my years in the payments and development space, so do some searching before you settle with something.

imho the main service of Kagi (and similar services) was not payment processing, but robust and secure licence key fulfillment.

Might want to try out fastspring.com

I am a Kagi supplier too. Although I stopped selling with them some time ago, I still have a lot of customer data in their database. I was surprised to hear of the closure and received no notification from them.

I have been using Share-It for over five years. They have a solid system for running licence generators and although it's not the most modern, I can recommend them as an equivalent service to Kagi. If you sell in the EU you'll want to check the fine print on their VAT policies.

Avangate and BlueSnap are two other full service options, I'm using both at the moment as I don't like to have all my eggs in one basket.

I extracted quite a sizable part of my income from Kagi shareware payments over the 90's and early 00's. Sad to see them go. I'm sure the nice people who worked there will become nice people working at any other places...

They were absolutely amazing to have in the days before the Paypals and international credit cards!

I can only echo all the sentiments echoed here – thank you for those reflections.

Kagi allowed me to get started as a developer, and my company has grown a lot since that fateful day in 2002 when I sold the first copy of my software Isadora. In all those years, they were never late with a payment until this month... a payment I suspect will never come now. (Or for which I will be offered pennies on the dollar. Guess we'll have to see.)

Customer support was pretty great; you always got a person who knew what was actually going on and who was super friendly and chill.

Well, farewell. One of those "end of an era" kind of things.

-- Mark

I'm devastated. Not for KAGI but for the fact that they went dark and took $3,100 of my money with them. No warning, no attempts to take care of someone who has been a faithful partner for 6 years. Don't count on getting any of yours back if they owe you. Here's an email from Kee Nethery, the CEO to me today.: ____________________________________________________________ All payments are halted.

We have not yet signed the documents with the firm. When we do, I’ll make sure everyone knows who they are and how to contact them.

We have maybe 6 months of deposits with the credit card companies. It will take time to get that back. Right now, your safe assumption would be that the money is not going to get paid out. Hopefully that is not true but until everything is finalized, that is the safe assumption.

Very sorry it ended this way.

Kee ------------------------------------------------ so good luck and so much for my $ 3,100

I wonder if they could sell their domain name to cover some of their debt... 4 letter .com domains are hard to come by.

And that name could certainly be of some interest for people in the security or cryptography fields (kagi meaning key in Japanese)

Indeed, the original Kagi logo played on this - if you looked at their logo upside down, it spelled Key.

http://www.naratt.com/Pictures/KagiLogo.gif

And "Kee" was the owner's first name, as well!

Suppose I had a four-letter domain I'm not using; what avenues are available for selling it, aside from Sedo?

You would need to find a domain broker you trusted to sell it for you.

Oh and P.S.: I've been in contact with a number of developers who used Kagi and have created both an open and closed group where we can discuss the situation and share news and commiserate. (The closed group is simply to allow us to talk privately if we feel the need.) Here's a link to the open group. https://groups.google.com/forum/#!forum/kagi-closure-informa...

I worked at Kagi around 2006, and it was a very odd operation. They still were using Mac quadras for business logic and Win NT4.0 for many servers. They were struggling hard then too.

(full disclosure – I work at FastSpring as a Product Manager)

Really sorry to see Kagi go. I think they had their reasons to close overnight and I really hope everyone will get the payout in full. End of an era..

Thanks everyone who mentioned FastSpring as a possible alternative – we are indeed way closer to Kagi than Stripe. We are (and Kagi were) what is called an MOR (Merchant On Record) and that's why we collect all the taxes, handle compliance, multiple payment methods and everything else that makes platforms "convenient" for a smaller business and "hands off" approach to all those issues. Stripe is (without deeper explanation) a payment processor (which means you are responsible for taxes/fraud) and their rules are stricter.

With that said, if you are not afraid of development work and tax/fraud/compliance issues don't bother you Stripe would be the best/most customizable/integrate-able option (with the exception of their Java API as we learned above :)

If you would still like "hands off" approach and let someone handle your taxes, compliance, payment methods etc I would recommend going with FastSpring. As it was mentioned, we are very supplier-friendly and will help you get up and running. We also have new cool APIs/Webhooks so give us a go if you are looking for a replacement.

I too used them to get my first business off the ground. I sold through them for over 5 years and always had good experiences. I met Kee and some of the staff at MacWorld 12-15 years ago and they seemed very nice. I'm sad to see them go, especially like this. They made something that would have been impossible easy at the time.

(full disclosure – I'm part of the Avangate team) Felt nostalgic about your stories, and how Kagi was a true pillar in your growth in the times of shareware / on premise licenses, we’re very sorry to see Kagi close its doors. While those were the days, some of their competitors transitioned to newer models and are thriving with their capabilities as more than payment providers with APIs for SaaS, online services and software on premise with renewals just like their clients. Hopefully everything will work out in the end with your remaining payouts. Not to sound like an opportunist, but I'd like to mention what I believe is a fit alternative to all those that need some help while looking for a replacement.

If you sell software, SaaS or any other digital goods, Avangate is a full service provider, solving the complexity of online commerce, subscription billing, distribution channels and global payments. Avangate is also the merchant of record, eliminating all issues related to local sales taxation, regulations, currency exchange and other account services. But don't take my word for it, hear what the customers have to say http://www.avangate.com/customers/ and also check out reviews on G2Crowd https://www.g2crowd.com/products/avangate/reviews

Good luck!

I started using Kagi in 1996 for Vestris.com. I was too young to incorporate in Switzerland, so I bought a BVI offshore. Kagi was the payment processor, helping me sell my shareware and sending a check, reliably. You were awesome! I would go to a bank in Geneva to get cash. Sad to see it go, but shareware is no more.

Sad to see. A friend and I developed a niche Mac pro-audio software tool in 2002 and Kagi was pretty much the only turnkey payment solution available. Primitive by modern (post-Stripe) era standards but we processed a few thousand dollars a month through them for several years without issue.

Really sorry to read this. Nethery did some work for me decades ago---an AppleTalk stack, if memory serves.

This is the email I just sent to the Kagi CEO, who disappeared with our cash:

Dear Kee,

Thanks for your message. However, Kagi should have informed customers in advance that they were ceasing operations, allowing them to collect their money and close their account. As I understand it, Kagi informs us that it has disappeared with our money, and that an unspecified somebody writing from a “do not reply” email will tell us more about it. Fraudulent bankruptcy would then only be the beginning of a long legal process. I seriously hope you will at least refund the account balance of the Kagi customers and avoid legal and penal consequences.

Kind regards,

Fabio

Hi Fabio,

Are you from Italy? I had the same experience and I'm out about $17000 from those guys that never missed a wire in the past. This really pissed me off because this shit has been handled very badly. Our payments are "our money" and should not be considered a Kagi asset but I think they are handling it in the "bad way". If you're from italy drop me a line to benacler at vvertex.com , I'm a little stuck on what to do , maybe an international cause will cost me more than what I've to get back :/

https://web.archive.org/web/20160801094831/http://www.kagi.c...

Site seems to be dead already. This seems awfully fast, given that they only ceased operations yesterday and still have a couple of things left to do, so the site might come back up for a bit. But here's a link to a snapshot just in case.

...and they're back. That was odd.

I still have some old Windows shareware games from the 90'ies that as late as just a few weeks ago generated a sale through Kagi (even if there has been no updates to the games for more than 10 years!).

So even if I'm not financially dependent on Kagi, I still have the account since then and this shutdown really came out of nowhere. Very little communication received from their part.

I had been using Kagi for over a decade. Failures happen but what is annoying is that there was no warning - just an email. I've lost $3000+ but what is vexing is that they took orders on Friday the 29th July when they must have known that they were going bust - is this not fraud?

The domain could be quite valuable not only because of the 4-letter length but also because it's an old domain with lots of links all over the 1.0 web.

I have received email of monthly payment of June but I haven't received the payment yet. So 2 months payments are not received?

Very sad to hear this. Out of curiosity, is the domain name up for sale?

also who of you has the CEO mail ? Seems there's no way to contact them anymore...

What did they do? Never heard of them.

Edit: Ah, they were like an old-school Amazon?

webcache.googleusercontent.com/search?q=cache:GSePr0KJAvoJ:krm.kagi.com/about/

Edit: Why is this post downvoted? There is nothing discriminating here, not even an opinion. Just someone asking what Kagi is. Instead of downvoting you should simply answer the question.

Kagi was a payments processor / fulfillment service provider focused particularly on shareware. Back in the days before app stores, if you were an indie developer your options for distribution and monetization were very limited. Generally you put out a demo version that took some sort of code to unlock, and users sent you money via the mail in return for unlock codes. This is how many software authors got their start in the 80s.

In the 90s, it began to become clear that accepting credit cards and providing the unlock codes online was the way to go, but for most developers actually doing that was out of reach. Not just for technical reasons, but the fees on having a CC merchant account on a low-cost, low-volume app were just not feasible. Kagi filled this niche. They would do the actual sales, in return for a cut, and provide the unlock codes to customers. You as the developer still handled all support. It was by far one of the easiest ways for a small developer to sell their software online.

I am guessing, although I don't know for sure, that they also provided some sort of libraries or implementation assistance for the 'unlocking' features inside the software itself, because many Kagi-sold apps had very similar-looking unlock codes.

Exactly what happened with the "vendor fraud situation" I don't know, but it's sad to see them go under so suddenly. They provided a valuable service for many years and there are a lot of apps that would probably never have been developed were it not for the sales channel they provided.

It was also very Mac-centric, I believe, so that may have limited the knowledge of who they are to smaller circles.

For perspective, Kagi was around before Paypal. They let the little guy sell online, in an era when e-commerce meant in-person appointments with your local bank manager to seek approval for a merchant account. (And then you'd have to discuss how your system would actually interface with the bank.)

You're probably being downvoted for the "Never heard of them", which may sound dismissive of the company.

Downvoted because: http://lmgtfy.com/?q=what+is+kagi

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