As the saying goes, “Good, better best. Never let it rest. Until your good is better and your better best.”
This describes the evolution of payments and billing for Appsmarket, a company with a suite of apps and subscription-based services. The HEARTY App, for example, offers pre-selected ideas for spending time with children and includes the option for in-app purchases. As the company scaled, customer information began to expire, and subscription payments that were hard to acquire began to fail due to expired information.
Fedir Bobylev, a Solutions Architect at Appsmarket, said roughly 80% of the transactions were done through Apple Pay, with the other 20% being credit card transactions. The company was using Stripe to process payments, plus capture and store the credit card or Apple Pay data. The information was kept in Stripe’s database and used to bill customers monthly for in-app purchases or subscriptions. However, it was not regularly updated or maintained, leading to failed payments.
These failed transactions would catch the eye of their PSP, leaving Bobylev in a constant state of paranoia, worrying about being shut down.
“Stripe was great for a long time, but they got to be unpredictable and say that despite business going great, we would get a notification that they are closing down our account,” Bobylev explains. “We got a scare about a year and a half ago, so we needed to safeguard ourselves from essentially being shut down by Stripe to have another provider.”
That kicked off a project for Bobylev that initially aimed to solve the HEARTY App issue, which could then become the solution for the rest of the products at Appsmarket.
Appsmarket worked with Basis Theory to vault their sensitive credit card and Apple Pay data while unlocking a multi-payment processor approach.
Bobylev explained that as the company built its payments ecosystem, it had to account for Apple Pay users—knowing that 80% of the transactions came from Apple Pay. Still, the solution is needed to satisfy the purchases made with credit cards.
“I started searching how we can store credit card data but keep it separate from the payment processing,” Bobylev said. “We wanted to find a token storage solution that was customizable enough without initial long-term commitments.”
After narrowing down the search to Basis Theory and another company, Bobylev says Basis Theory won out because of the ability to get started without having a long-term commitment. He wanted to build a proof of concept to store credit card and Apple Pay information somewhere other than Stripe. Three days after scheduling a product demonstration with the Basis Theory team—and following the developer documentation—Bobylev said he enabled the proof of concept.
“The Basis Theory team and documentation were straight to the point, and within a week, I could actually ship a very fast demo,” he said. “What took longer is negotiating with Stripe to enable all the APIs we needed from them.”
Regarding Apple Pay, Bobylev said he appreciated the Basis Theory team's guidance and Apple Pay overview.
“Because we had a Slack channel with the Basis Theory team, I got quick responses and ideas that actually helped us when we talked to Stripe,” Bobylev said. “The support along the way has been superb.”
If the initial MVP worked, Bobylev planned to spread the solution across the different products and companies underneath Appsmarket.
“This was going to become our primary billing process,” Bobylev said.
Bobylev said the pricing structure of Basis Theory allowed him to sign up from a month-to-month standpoint and, if the MVP proved effective, commit to a long-term contract.
“We were able to test out different features, even enabling stuff like BIN lookup,” Bobylev said. “We found that the easiest way to go as we scale was to keep everything in place with Basis Theory. We’ve only had great experiences.”
With the annual commitment, Bobylev said the company added 3DS and Account Updater for the 20% of credit card transactions.
“We want to make sure that if the customer card gets out of date, we can pull in the new one and use it,” Bobylev says. “Then we can route the payment depending on the country or region.”
Most of the payment routing is cascading and not very complex, but it will be more complex as the company grows. Because the company sells to a global customer base yet is based in the United Arab Emirates, as many transactions as possible are routed through the UAE, where Stripe has a high acceptance rate.
Routing retries through the United States can boost acceptance rates by 20% for failed transactions.
“We will route a payment either through Apple Pay or through credit cards, first through UAE, and if that fails, we will bring in a new provider,” Bobylev says. “This is where we start some basic routing options to keep our eggs in two separate baskets.”
Bobylev says there’s still an element of unpredictability because Stripe can always send out a notice, but he knows everything will be fine.
“We feel safer now knowing that in the worst-case scenario, if Stripe is never working with us again, the payment data is safe,” Bobylev says. “We’ve done our tests that if a gateway fails, we can reroute and rebuild traffic to another. There’s still some loss, but we can still be in business.”
Bobylev said all products should be transitioned to this new infrastructure over the next six months. Since entering production with Basis Theory, authorization rates have increased, and compliance requests have decreased.
“We’re seeing these increases that vary from 5-10% across each product, which is substantial because that’s revenue for us,” Bobylev says. “Our partnership [with Basis Theory] has been great. We get direct, human responses from people who know their stuff. That’s a benefit of working with Basis Theory that we could have missed out on if we picked another provider.”
“We have kind of figured out all the hard parts. Now it’s about scaling and ensuring we don’t break anything internally,” Bobylev says. “Basis Theory will be part of that for us.”