A year into building ContainIQ, a Kubernetes monitoring and tracing platform, it became clear that we needed to offer more flexible pricing options to our customers. Pricing is a notoriously difficult thing to figure out as a SaaS startup. Having only launched publicly about 7 months ago, we need to come to market with a technologically simple pricing strategy. As a small startup with limited engineering resources, we initially optimized for a single flat-rate pricing structure that we thought was the right size for our target market, largely Seed to Series B type startups.
While simple to implement, our one-size-fits-all approach limited our ability to sell to different stages of customers. It quickly became clear to us that we needed to move our pricing model to a variable usage-based system that would accommodate both small and large customers, now and in the year ahead.
With ContainIQ, it is easy to correlate metrics, logs, events, latencies, and traces. Our customers get a comprehensive set of tools quickly and easily. And because we are a Kubernetes native platform, we are able to provide deep insight into cluster and application performance with a one-line install. After talking with many of our current customers and those in the pipeline, we decided to move to a variable billing model based on the number of nodes supported on ContainIQ and the number of GBs of logs ingested to our platform
After initially integrating with Stripe, our team scoped out what a homebrewed metered billing project would entail. ContainIQ’s growing product suite and customer demands introduced a number of challenges for our company:
- Most of our engineering resources need to focus on building new features for our customers.
- We didn’t want to spend ongoing engineering time maintaining our metered billing system.
- We needed a solution that all members of our team would be able to use — Product and Growth, for example — not just members of the technical team.
We made the decision to look for a third-party solution to help us implement and manage a metered-based pricing model on top of our current Stripe integration.
We needed to find something that supported multiple pricing meters while still being efficient from an engineering perspective. We also wanted a solution with low onboarding costs and reasonable ongoing costs based on our usage.
After exploring a number of options available on the market, we made the decision to work with Octane. So far, it has been a great decision for us.
From our initial decision to release, it took a member of our engineering team a couple of weeks to fully implement Octane as our metered billing solution and manager. This timeline covered the entire migration, including integrating with their SDK, setting up price plans, enrolling our customers, and validating our integration. Octane has the ability to price based on a variety of meters, making it easy to implement our per-node and per-log-ingest pricing model quickly.
Octane also gave us the ability to create and model additional pricing schemes in the future. For example, if we want to add per-trace billing later this year, we can first use Octane to model and then stand up new pricing meters easily.
Octane was also really affordable. It is especially completely reasonable when you consider the amount of engineering time we would need to spend to manage this technology in-house. I also really liked that they practiced what they preached and showed faith in the strength of their product by pricing their product on usage.
Apart from their service, we’ve gotten a lot of use out of their online portal. We appreciated Octane’s first-class support for Stripe. Navigating between Octane to Stripe is very easy with their seamless integration. For example, you can click from a customer profile in Octane directly to the customer profile in Stripe. Another one of my favorite features is the Preview Invoice tool, which allows you to preview an upcoming invoice based on early usage for new customers. This helps us understand where our current MRR is throughout the month and as we sign-up new customers in the middle of a billing cycle.
We are thrilled to say that Octane has changed the trajectory of our company in a positive way.
We are now able to add more flexibility to our pricing, and it has already started to pay off in terms of MRR. Our sales funnel has really embraced the change and I’ve noticed that our conversion rates are improving for the earliest stage customers who want to use our self-service product.
At ContainIQ, we are excited to deliver an incredible amount of value to our customers at an affordable price point. And that is what Octane does for us, too.