Lune’s journey to perfecting API pricing (and saving the planet) with Lago

Introduction

Every founder aspires to make the world a better place. At Lune, they’re not just dreaming about it – they’re actively creating a climate-positive future. Their journey serves as a blueprint for how to build a thriving business while tackling a very messy, opaque market. Not only for climate tech companies, but for any startup building an API and searching for that elusive product-market fit milestone. To learn how they turned green into gold and leveraged Lago to master billing, read on.

So what is Lune? Back in 2021, Erik Stadigh and Roberto Bruggemann founded Lune to make it easy for any business to embed climate action into their customer experience – starting with carbon emissions calculations and carbon removal. Before Lune, companies typically released a sustainability report that ended up buried somewhere on their website, or engaged in some other form of greenwashing without any concrete environmental impact.

To address this gap in the market, Lune developed the only API that combines both real-time emissions calculations and climate contributions. Since launch, they’ve partnered with the likes of Visa and have helped companies operate more sustainably in logistics, supply chain, payments and banking.

Challenges

To support Lune’s growth, Erik had to keep their pricing and monetization strategy flexible, and their needs included:

👉 Billing annual subscriptions that included usage, and bill potential overages monthly;

👉 Metering the usage of the product(s): emission calculations, carbon offset, and more dimensions as the product grows;

👉 Idempotency: Lune’s team wanted to make sure they wouldn’t take the risk of billing a user twice based on usage;

👉 Tax management: defining the taxes at the charge level;

👉 Analytics and workflows: calculating the monthly recurring revenue, handling payment collection and outstanding invoices.

Solutions and impact

Fast time to implementation: 3 months of engineering saved

The Lune team sent relevant usage data into Lago, which enabled them to assign different prices to usage and link it to subscriptions and customers. Lago also built-in native integrations with payment processors, managed “grace periods” and invoicing, all these nitty gritty details to be figured out when you’re just excited to keep signing and onboarding new customers.

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Pricing flexibility: more revenue and less technical debt

As Lago acts as a layer of abstraction between usage data and pricing, the Lune team could experiment with pricing without requiring engineering resources: this can mean adapting pricing for a larger enterprise customer, launching a new feature (and be able to price it, effortlessly), or trying out a new pricing strategy.

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Expertise - beyond billing: a revops team out of the box!

Beyond the initial implementation, the Lago team was also a partner to Lune to support their projects: revenue analytics, internal workflows linked to billing, such as the integration with their accounting software.

The fit was so clear that Erik even wrote an angel check into Lago’s seed round after the implementation. And we are honored!