I sat down with Puneet Gupta, Founder & CEO of Amberflo, a cloud metering and usage-based pricing and billing platform that today announced their Series A and general availability. Watch our full conversation below and read on for a dive into the product, more about the problems Puneet is solving, and why he’s the one to solve them.
Amberflo is a cloud metering and usage-based pricing (UBP) and billing platform. Companies using Amberflo can sell their products and services on a usage-based business model, so their own customers are only paying for what they use instead of the more traditional pay-per-seat model. Companies get deep, real-time customer insights around usage, consumption, and the user journey - all while delivering critical cost-saving and accelerating revenue.
Why You Should Pay Attention
In these challenging market conditions, companies of all shapes and sizes are looking for ways to drive efficiencies in their business models and provide meaningful value to their customers.
Adopting a usage-based pricing model can do exactly that.
The usage-based business model originates with AWS, so while it may be new for some, Amberflo’s Founder & CEO Puneet Gupta and founding team has been at the forefront of this shift for over a decade. Their team was responsible for some of the original metered, usage-based cloud services and the underlying platform at AWS that are used by millions of customers. With this deep industry and technical expertise and hands-on experience, this team is uniquely positioned to usher in the new era of software pricing.
“Usage-based business models have been proven that they’re better, more fair, and more transparent. It’s actually a profound win-win that drives greater customer retention and satisfaction, as measured by superior Net Retention Rate (NRR). At the end of the day, it serves the customer well. I always believed the world was going to go in this direction. It was simply a matter of time.” - Puneet Gupta, Amberflo Founder & CEO
Business models don’t change very often. The shift towards usage-based pricing is gaining more and more traction, with large companies like Snowflake helping to normalize the idea of pay-for-use vs a standard seat. Customers are increasingly in control to make their own decisions at their own pace, and want to be in control. Product-led growth (PLG) is a key example and shift in how users are adopting software - the true value of which, according to Puneet, can only be realized with usage-based pricing (in fact, he says real PLG is incomplete without it).
Amberflo’s architecture leads the way in their adoption. In the early days of building the platform, they made the decision to decouple metering and pricing. Customers can deploy metering independent of billing, putting metering in place first to inform the development of usage-based pricing plans, and to support downstream applications across finance and accounting, customer experience (sales, marketing, and service), and product development. This design empowers engineers, DevOps, and technical teams to keep resources focused on product development and differentiation, and frees up those dedicated to testing and implementing pricing changes.
With these decoupled, but integrated platform, customers get real-time usage data, analytics, and the ability to integrate data from the metering and pricing side to support one another through price modeling, real-time ingestion and aggregation, on-demand metered invoicing and billing, actionable insights, revenue analytics, predictability, and a user-friendly interface for all.
This decoupling of platforms empowers customers to flexibly and accurately build modern pricing plans, moving beyond seat-based and other legacy pricing strategies that frustrate customers and contribute to the proliferation of shelfware. Amberflo even offers a range of pricing models available such as unit-based, pre-paid with overage, volume-based, tiered, block, multi-attribute, and even price plans based on custom dimensions to support any pricing vector across SaaS, PaaS, IaaS, IoT, and edge application services.
“We have a decoupled, but integrated, metering cloud and billing cloud. We have a long thesis on why this has to be the case, but it was just our thesis as we started. It was a risk at the time, and we only had our conviction to go on. However, today customer after customer is selecting us because of this design and architecture. It has been more than validated, and those are the kinds of moments you live for as a founder."
How it Works
Built as a developer-friendly platform, customers simply define their “meters” - any product, system, artifact, or resource that they wish to usage-track - and send those records to Amberflo. Meter records are automatically measured, tracked, and aggregated to yield a better understanding of usage, costs, price elasticity, and much more. This all happens on the Metering Cloud - it combines the functions of a time-series database, relational database, data warehouse, ingestion infrastructure, data transformation, data deduplication logic, idempotency, and data analytics - all performed as an integrated pipeline.
Amberflo Billing Cloud layers on top of the Metering Cloud and allows companies to take their metering data and build modern, usage-based pricing plans that accelerate growth and delight customers. Customers can easily build and deploy their usage-based plans, deliver metered invoicing and billing, and track usage and revenue, accurately and in real time
Why We’re Obsessed
Software companies have been increasingly seeking to adopt usage-based or consumption-based pricing over traditional per-seat and other pricing, but the barrier has been the lack of technology to track, price, and bill accordingly. With deep industry expertise, Amberflo’s founders have seen this shift coming for a long time, and built the right architecture to help customers cross those barriers.
And it’s not just us, businesses love Amberflo too. With tens of billions of metered events flowing through Amberflo everyday, it’s clear that their customers are using the product and relying on its insights to drive value for their own customers. For example, Puneet shares how LaunchDarkly’s massive volume processed through Amberflo has enabled them to turn off older systems thanks to their partnership, helping them realize tremendous ROI. They’re able to now delight their customers with real-time usage reports and accurate metering billing.
We’re also deeply impressed by Puneet’s commitment to building the right team and setting a foundation to build and scale on. It’s not enough to have just experts on your team, they need to come with the right mindset to win and win together, and that takes intentional work. As Puneet shared, “Culture is one of those things where if you don't set it, it will happen to you. And if it happens to you, then it's already too late.”
Ready to move into this new era and drive ROI? Here are Puneet’s steps for adopting a usage-based model. Learn more about their solutions here and get started tracking usage and updating your plans here!