RevenueCat Secures $12M Series C to Expand Subscription Management to Web

RevenueCat Secures $12M Series C to Expand Subscription Management Platform to Web

RevenueCat, a leading subscription management platform for apps that monetize via in-app purchases, has recently closed a $12 million Series C funding round led by Adjacent. This new capital injection comes on the heels of the company’s launch of RevenueCat Billing, a product that enables web app developers to integrate subscription purchases into any website, with plans to support Roku in the future.

Adapting to the Changing Landscape of App Monetization

The introduction of RevenueCat Billing coincides with the implementation of the EU’s Digital Markets Act (DMA) regulation, which compels Apple to open up the iPhone and the App Store to new competition. Initially, Apple blocked iPhone web apps (Progressive Web Apps, or PWAs) in the EU, possibly out of concern that developers would abandon its App Store. However, under regulatory pressure, Apple reversed this decision.

For RevenueCat, the impending changes for iOS and Apple’s unwillingness to reduce its standard 15%-30% commission rate have resulted in an increased number of developers seeking alternative monetization methods through the web. CEO Jacob Eiting explained, “It could be for progressive web apps or any kind of customer that wants to take payments outside of the App Store. It’s going to play within all the new [DMA] rules … it’s going to be a pretty significant product expansion for us.”

Addressing Developers’ Needs with RevenueCat Billing

While payment processors like Stripe already offer similar functionality, developers lacked a system specifically designed for consumer subscription apps. RevenueCat Billing bridges this gap by providing developers with a unified dashboard where they can manage their subscription data and insights, regardless of whether the payment originates from the web or mobile. This streamlined approach allows developers to focus on their apps’ overall monetization performance.

Although Apple has historically prohibited app developers from directing customers to the web from within their iOS apps, it has allowed steering from other channels, such as the developer’s website or customer emails. The EU’s DMA rules are expected to permit developers to steer customers to the web from inside their mobile apps as well.

Expanding to New Markets and Pursuing Profitability

In addition to fueling the development of new products, the Series C funding will support RevenueCat’s expansion into new markets, including Japan and South Korea. CTO and co-founder Miguel Carranza emphasized the company’s commitment to educating developers and businesses about the challenges of building in-house monetization solutions, stating:

“Our main competitor is ‘cobbling together monetization technology yourself’. In the U.S., we’ve done a good job at educating developers, product people, marketers, and CEOs on the challenges of building in-house. In many other regions, it’s unfortunately still the default for businesses to sink valuable resources into something that provides zero differentiation or value for that business’s end users.”

While RevenueCat is not yet profitable, CEO Jacob Eiting maintains that profitability is always on the horizon. The company still has the funds it raised in 2021 and now boasts over $40 million in the bank, along with approximately $20 million in ARR. RevenueCat has also managed to halve its burn rate since last summer.

Image Credits: RevenueCat

Eiting believes that deploying capital to build new features and products, even if it means delaying profitability, is the best course of action for the company’s customers and investors. In a recent blog post, he stated:

“RevenueCat is too important to too many apps to risk the company driving towards a financial cliff. This may be counter to the prevailing narrative of how venture-backed companies should be built, but our investors are aligned with us and know that Miguel and I are leading the company to maximize the value for developers. Investors make more money when developers make more money.”

Despite this approach, RevenueCat still aims to go public within this decade, demonstrating its long-term commitment to supporting developers and driving innovation in the subscription management space.