Braintree is giving $50k in processing to every startup | Hacker News Reader

Braintree is giving $50k in processing to every startup

braintreepayments.com

183 pointsthehammer91 comments

Works out to about $1,450 in savings if you process $50,000. I hope people don't impulsively go with them just to take advantage of this offer. In fact, you probably don't want this offer to have anything to do with your decision-making on the best processor for your needs. That decision is not easy to undo - and will easily cost you more than the savings.

There's no commitment if you code against Spreedly instead of against Braintree's API. Then, once you save your $1450, you can switch processors if you're so inclined by changing just one token in your code.

Spreedly is a unified API for 58 payment gateways, a gateway-agnostic billing info vault so your customer info isn't trapped in whatever processor you chose at the time they signed up, and can alleviate much of the PCIDSS compliance burden if you choose to point your payment forms to them instead of your own server.

https://spreedly.com

I've been using them for a few years now. If you have a lot of recurring billing, knowing that you own that customer data instead of your processor, and your processor cutting you off without notice (which ALL of them can and have done to customers) won't interrupt your business, is peace of mind Spreedly sells very cheaply.

Have you ever had to change gateways? They charge 2 cents on top of gateway fees - would it be substantial for you if you went direct to the gateway? I imagine less sales at higher prices it's worth it. Many lower price sales it would be worth it to gateway hop manually cost wise.

The monthly fee makes it unappealing for small volume customers, and the per-transaction fee makes it unappealing for large volume customers. I'm guessing there's some intermediate range, when you are negotiating the final deal, where it's comforting to have that "flexibility".

Justin from Spreedly here. Dan, thanks for the kind mention! Dan's use case is one of the main driver's we see. We also see most interest from businesses/services that need their own vault as they work across multiple payment gateways. Either a SaaS billing/booking platform or someone working with 3 or 4 different gateway's globally. Single API/Single Vault/No PCI headache. Many of our customers are weighing up PCI L1 for card storage and/or integration to multiple gateways or Spreedly.

In terms of Dan's scenario we had a customer whose primary gateway was unresponsive early Sunday morning which happened to be their biggest day of the week. They brought a Stripe account up in around 5 - 10 minutes and processed 6 figures that day. Not sure how you ROI that against our fees but they were happy!

> Have you ever had to change gateways?

Several times. And have lost customers in the process, since any customer info stored at the gateway is lost and getting hundreds of people to re-type their billing info in is a big undertaking and a big pain.

The cost of "hopping gateways" for any SaaS has little to do with the cost of the gateway or the cost of development. It's all about customer retention.

When I left one merchant account provider which had ratcheted up its rates every month for years to the point that continuing with them was absurd, the gateway refused to provide my customer info to me or transfer it to a new provider. It simply wasn't mine to have, in their view. That will never happen again; even if I leave Spreedly, they will give me the info to take with me.

> They charge 2 cents on top of gateway fees

Whether it's a $29/month customer or a $2000/month customer, 2 pennies just doesn't register. Let's say I have 500 customers that get charged each month. That's $10/month in transaction fees from Spreedly. That would buy me... 2 more ad clicks from Google. Or the peace of mind that my business's billing info and cash flow can't disappear overnight.

I was talking more about large volumes of lower amount purchases. I understand that if your prices are high even with high volume it's worth it.

Thank you for the details. Spreedly looks great.

You wouldn't lose customer data if you left Braintree:

https://www.braintreepayments.com/landing/data-portability-p...

What are some examples of qualified providers that will accept this type of data?

It says they'll accept a public key from the merchant, which is you; you don't need to find a provider that'll work with the data in whatever format it's in.

The "attestation of PCI compliance from a qualified provider" line refers to companies like these: https://www.pcisecuritystandards.org/approved_companies_prov...

Anyone with a merchant account to accept credit cards online already has a relationship with at least a QSA, and is already getting a quarterly attestation of compliance after completing a questionnaire and security scan of their server environment; it's required by PCIDSS and merchant account providers enforce it, typically providing an account with a QSA for a non-optional annual fee and imposing another fee if you fail to remain compliant.

It's just a formality having them forward that attestation to Braintree before they hand you the data dump.

Balanced will and has.

I'm also a happy user of Spreedly (via their subscriptions product which is now owned by Pin Payments, IIRC) and can verify that Dan's exactly right about how easy swapping out a gateway was. When I moved from Paypal (their I-can't-believe-it-isn't-a-gateway product) to Stripe it was literally 30 seconds of data entry in their admin screen and zero lines of code changed.

It's actually probably WAY more than that - you're forgetting the $.30.

If your average cart size is $20 - that's an additional $750. $10 (Lots of Saas) it's $1,500.

Average cart size for online shopping is $110, so that's more like $150 which isn't so bad.

Have you got a source/more detail on that average figure out of interest, that's way higher than I expected. Is it mean or median?

69% of statistics are made up on the spot :P

The quoted number is plausible insofar as many vendors offer free shipping with purchases over $X

The 110 number is a truism in payments (in which I work) but I don't actually have a citation! Interesting question I'm going to find where that comes from.

> That decision is not easy to undo

How so?

I assume he's referring to the fact that you have to write Braintree-specific code (if you choose not to use Spreedly). And if you later decide to switch gateways, you have to do that again. So unless you're convinced Braintree is viable in the long term, you might lose out on the savings you get now with the time wasted doing a rewrite.

That's how I understand it too. But this rewrite will be what? ... a couple of hours of work? A day tops.

I guess it depends on your product and how deeply you need to integrate.

Yes - the headline is a little misleading. It's not "Here's 50k on us".

Pretty cool. I love the competition in the payments space right now. My bet is that Braintree is seeing some serious competition from Stripe and others.

One thing to keep in mind is that 2.9% + 30cents is relatively high. If you go to Authorize and negotiate they will lower the price if your volume is high enough. Stripe will also negotiate once you hit a certain volume.

One thing I really want to do is take on the micropayments space. No one has really managed to do it well. Think about how much it costs to charge someone a dollar. The cheapest way is paypal. But what if you want to take a Visa/Mastercard? You are at their payment network's mercy. In order to really challenge that you need to make your own payment network. And then get banks onboard. And get through all the regulation. Yikes. If anyone is interested though contact me.

It's probably this sort of heated competition that keeps Square from being able to IPO in 2014.

Square is tackling different type of merchants. It's not quite this that is keeping Square from an IPO; but they messed up in a few ways along with Chase (their merchant acquirer) releasing the same product undercutting the Square margin. Not to mention PayPal's ability to lower the price or the international market is almost gone for Square (others have copied Square).

I hear you on that. I guess it depends how narrowly one defines market. And I guess the more narrowly one defines it, the harder it is to justify a valuation.

That being said, I suspect my downvotes were a function of Jack Dorsey fanboys knee-jerking more so that my overly broad definition of the payments market.

No, I think it was just sort of an ill-informed, senseless and inaccurate comment.

You're a loser.

Actually, Stripe's market is smaller than Square's. But these business models will never capture a large percentage of their respective markets anyway due to the high rates (negotiating with an acquirer can get you almost 50% less than their rates). After all, "Simple Pricing" is not as good as it sounds. Why pay 2.9% on a 0.05% debit card for the sake of simplicity? I'm sure Excel can handle these variations. This is an unfortunate consequence of the inefficiencies of that industry.

That last paragraph is spectacularly spot on - that's why I started knoxpayments.com - connecting people directly into their banks. No fees on micro, $0.18 on everything else - flat.

Just won Best Enterprise at Launch 2014, and we're moving fast toward solving this problem for folks!

Are you able to take visa/mastercard?

We are not - we sync directly with people's online banking to make ACH payments without asking people to know their account and routing number.

Does that mean you require their bank account login info? If not how do you access enough infor for ACH?

That's the one!

Is posible to integrate into a IOS App?

We're building that SDK now - tommy at knoxpayments.com I can tell you more about it and see if it makes sense for what you're building.

Anything on the roadmap for Android?

RIGHT after iOS, could be a couple months though :/

Wow! Thank you for sharing your startup. I see what you're doing and it's really a brilliant idea - it would work very well for payment funnels where consumers trust the brand.

I don't see any developer documentation though - is this intentional, or did I miss the link somewhere?

Is that intentional - heck no! It's a massive and glaring omission in our offering!

No but seriously, I'm banging away at documentation right now - the problem is it wasn't clear what exactly we needed to document until we launched and got the deluge of customer feedback that we've now gotten. It's now become clear that we're missing some critical features (for a lot of people) and that's it's not clear how to integrate it. Live and learn!

Essentially though, for 1 to 1 payments, you'll just sign up, sync your bank account, and you'll get a JS snippet and an HTML div. Put those on your site, feed the JS a payment amount, and when someone clicks the button - they'll pay, and you'll get the money. Then, at the end of the payment, you'll get a payment ID that you can store and use our entirely undocumented API to retrieve information you need later.

Hey, I'm wondering if Knox integrates with Key Bank? Thanks

Hey, I just tried signing up and the site says I need to enter a referrer. Any chance you could let me see what this is like?

Use the code "LAUNCH"

What am I using to login with my bank? Yodlee?

Nope - our own custom API that is way faster and (in our opinion) way safer. NOT to say Yodlee isn't safe, we just think we're safer.

Well, I'm sorry to say, you don't look safer. The URL changes from knoxpayments to paidez which looks super fraud-y! And you're not using good SSL certs. You do realize that you are requesting bank account logins from all your users? I couldn't find any information on your web site to help me determine if I should give you my online banking credentials.

I agree, we've done a pretty bad job of explaining and presenting ourselves thus far.

I'm not making any excuses, but we spent the last year building, speeding up, and securing the engine that handles the connections to bank accounts and the system to process and guarantee "good funds" ACH payments. We had an opportunity to go to Launch 2014, and even though the front end presentation of everything to the user was, in a word, "fucked", we made the decision to go and do the best we could to make it usable. This thread alone has helped me find a lot of the "anxiety" points people are having, and the customers I talk to everyday are getting me more. You'll see Knox back on HN soon with a much, much improvement experience.

How do your payments work? ACH or something else? Do you explain it anywhere?

It's ACH - there are some FAQS on knoxpayments.com/about.html

so who does the fraud detection? knoxpayments?

We do fraud detection on top of the fraud detection your bank AND the US banking system already do.

Do you have any data on conversion rates? I imagine they would tank through the floor if you're asking a customer to turn over their online banking credentials.

Nope! Conversions are pretty good, same abandonment as CC's right now, and it's rising as we get our UX better. People hate inputting their CC information, and when they've heard of Knox at least 1 time before, they're way more likely to convert than using a CC. However, first time users are about the same conversion as CC's in our betas.

Nice! How can end users be confident their username/password for their banking site will be kept between them and their bank? (I'd be reluctant to enter those anywhere other than the bank's own site.)

As you should be! We're working really hard on educating our users at the point of purchase, but we do a meh job right now. However, users who are able to understand that we don't store any of your information convert at a very high rate.

Hey, why don't you use HTTPS by default and your signup is in another domain (paidez.com)?

The Paidez thing is embarassing - we re-branded really fast and couldn't move all the services over before we launched. We're working on it now, but it sucks.

What do you mean about the HTTPS? We load ALL our content via SSL, do you mean knoxpayments.com isn't automatically loaded with SSL? There's nothing secure on it I guess, but even that should be for consistency.

Our payment process requires SSL end to end encryption, but are you suggesting that having Knox Payments not load with SSL by default it looks bad?

If I've missed something more important please tell me - if there's something (other than the atrocious switching of URLs) that is making you nervous, I NEED to fix it!

it exists; it's called Dwolla and almost no one uses it.

Yup. If everyone just had a Dwolla card.

Don't underestimate Dwolla - they're a fantastic company, and even if "nobody uses it" if that nobody is fast growing into "somebody", that's really something to consider.

Agreed Dwolla is one of my favorite startups. Talk about upending an industry! I recommend this TWIST episode if you are wondering why:

http://www.youtube.com/watch?v=BFeSgN1cQhg

Braintree will also negotiate with you once you hit a certain volume.

In case some of you aren't aware of this, PayPal acquired BrainTree a while ago:

http://techcrunch.com/2013/09/26/paypal-acquires-payments-ga...

There is this comment about it: https://news.ycombinator.com/item?id=6455951

For a moment I thought it was the first $50,000 in fees not transaction volume. Still pretty cool and will probably get me to try them out.

I'm delighted for all potential US customers to get such a nice deal thrown their way - nice one Braintree! Too bad the offer doesn't extend to Europe, but I can appreciate the complexity in setting up something like this world wide.

I'm currently in the process of going live with two sites using Braintree, and everything has been great so far. Excellent Python API, documentation and extremely quick, knowledgeable and friendly support.

My previous payment provider experience has been with Cleverbridge, Digital River and Paymill...and so far Braintree has managed to surpass them in every single way. YMMV but for my use case Braintree has been a great fit.

Keep up the good work!

They ran this promotion before too. I tried to use it but later was told I couldn't because I'm a 3rd party payment aggregator. The trouble is they never said TPPA couldn't participate anywhere in the promotion. I felt tricked. I continued to try to set up processing with them as a TPPA but it was this long drawn out and manual process. The CEO ended up contacting me to apologies and see what the problem was. He told me they didn't disclose the TPPA restriction on the website to make it "simpler". After many phone calls with them I was never able to get set up. Stripe just came out with Stripe Connect and I was up and running in a matter of minutes. Not to mention support at stripe has never been so bad that the CEO had to contact me. In fact I think stripes real edge is their excellent support. I would never use anyone but stripe after seeing how bad it can be. Note I have no affiliation with either company. I'm a Chicagoan and want to see Chicago companies like Braintree succeed but boy what a poor job they did. Definitely not with $1500 IMO.

(I'm an engineer at Braintree.)

Hey Luke, we had an internal discussion about what happened with RaceMetrics and came to several conclusions about what we could do better. The restrictions on who can use Braintree and who can't now are listed here: https://www.braintreepayments.com/faq#restricted-business-ty...

Your experience with us was before we launched our Marketplace product, which eliminates the need for many people to onboard as a TPPA. If you were to apply now, things would be a lot better.

Every startup in the US at the moment which is a shame, same rules as last time

As a European who was disappointed that Stripe isn't in my country yet, I was pleasantly surprised to find out that Braintree is every bit as easy to use[1] (took me a half hour to set up a test transaction website), and it's even cheaper than Stripe. (Edit: Seems Braintree's European pricing differs from their US pricing. Braintree's European pricing is 1.8% to 2.6% (everything included) which is considerably cheaper than Stripe).

The only downside I can see is the approval process which in Europe takes 7-10 days.

1) https://www.braintreepayments.com/docs/python/guide/getting_...

(I work at Stripe, based in the UK.)

Our pricing in EU countries where we've launched (UK + Ireland) starts at 2.4% + 20p (we've revised pricing for each country when we launch out of beta). We regularly give volume pricing well below 1.8% - so at both ends, considerably cheaper than the range quoted above.

Also, which country are you in? Stripe is available in full production-ready beta in France, Germany, Spain, Luxembourg, The Netherlands, Sweden and Finland, with more countries in the coming weeks - keep an eye on https://stripe.com/global for updates.

You can sign up and start using Stripe to process live transactions instantly in all our beta countries - this is a key requirement for us as we expand globally.

I'm in Denmark. Any idea as to when Stripe is coming to Denmark?

Will merchants be instantly approved, or does it take several days/weeks?

Soon! Want to drop me an email? ay@stripe.com

I'm a current Braintree customer, where my start-up integrates to their services via our custom cart. I can't really compare them to their other competitors, but one of the things I really like is the ability to call them and ask questions about my business workflow.

Often times, I get their 2 cents before I change my business workflow, or I get crazy unexpected scenarios I need help on (mainly involving vendors getting new credit cards).

I appreciate them going beyond the call of duty with helping me with things outside the traditional technical api questions. I just hope the paypal acquisition won't change things...

Braintree isn't a bad choice, not the best but better than most. Their documentation and needs for more complex stratiges for domain logic is lacking. Stripe has one of the best documentations I've seen as far as payment gateways go and how it can fulfill most business needs. As far as MVP products go I grade each api on documentation and flexibility. 1. Stripe, 2. Braintree, 3. Custom gatwate solutions such as shopifies gem. Im sure there are many more solutions but as a developer without a huge background in payment processing solutions this is my assessment.

"for any U.S.-based startup", then I closed the tab. But great, good option "for any U.S.-based startup", they seem like a fair and cool payment gateway.

I am working on a marketplace project right now and I was wondering if anyone can suggest an international payment processor other than PayPal. Braintree Marketplace would have been perfect but it is currently only for the US. The same goes for Balanced Payments and several other options.

(My project involves freelancing and finding small projects - Sign up page at http://www.ladr.io/ if anyone interested)

Check out MangoPay.

We are based in the US and I don't think we will be eligible. From their FAQ -

Am I eligible to use MangoPay?

All companies registered in the European Economic Area can use our solution.

Hi I'm the founder of Mangopay. You can process payment in € $ £, and 7 other currencies on Mangopay. But you are right, you should have a company incorpored in Europe. Feel free to contact us! C.

Would Stripe connect not work here?

I think this is a really great way of enticing new startups. Yes it's to get them more business, but for once it actually brings a good benefit of $1400+ for startups.

I would use Braintree for things like this.

Existing customers too? The signup button sends me to a form for new customers.

Do I really have to cancel my account and open a new one?

Kristi from Braintree here. Happy to help. Just sent you an e-mail.

Important note, I believe this doesn't include marketplaces.

Hi, I work for Braintree. This is open to marketplaces as well, and payouts are always free.

Fantastic! That's a great way to delight your customers.

Non US, non EU merchant? Sorry no cookie for you. :(

Which countries do they support?

...for any U.S.-based startup...

Use it for the first $50k then switch to Stripe..

Probably not worth your time to save ~$1,500 unless you use an abstraction layer like Spreedly or you're really short on cash.

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