RevenueCat Raises $50M to Expand Monetization Solutions

RevenueCat Secures $50 Million to Broaden Mobile App Solutions

RevenueCat, a pivotal player in the mobile app subscription market – currently utilized by one-in-three new subscription applications – is poised for significant expansion. The company intends to leverage its established market presence, which encompasses powering subscriptions for over 70,000 mobile apps, to address a wider range of challenges faced by mobile developers.

Navigating Post-Antitrust Landscape & Web Payments

Following the resolution of the Apple-Epic antitrust case, RevenueCat is assisting developers in evaluating the optimal timing for integrating web-based payment options. This is now permissible under updated U.S. App Store guidelines, and RevenueCat provides the necessary tools to facilitate this transition.

Series C Funding & Valuation

To support its ambitious growth strategy, RevenueCat has successfully raised $50 million in Series C funding, led by Bain Capital Ventures. Existing investors, including Index Ventures, Y Combinator, Adjacent, Volo Ventures, and SaaStr Fund, also contributed to this round.

This latest funding supplements a $12 million Series C secured last year, bringing the company’s total funding to $100 million. Consequently, RevenueCat’s post-money valuation has reached $500 million – a milestone playfully referred to as “half a corn” by CEO Jacob Eiting, referencing the term “unicorn” for billion-dollar companies.

Scaling for Public Market Potential

“This funding provides us with the necessary resources to expand our operations,” Eiting stated in an interview with TechCrunch. “We believe we have the potential to build a company of significant public scale.”

Expanding Beyond Subscriptions: A Shopify-Like Vision

RevenueCat’s future product roadmap is central to its growth plans. Initially focused on simplifying subscription implementation for developers, the company is now aiming to resolve a broader spectrum of issues confronting the mobile app development community.

Eiting draws a parallel to Shopify’s evolution, noting how the e-commerce platform expanded beyond its initial subscription-based storefront tools to encompass fulfillment, lending, and an app marketplace. “We possess extensive knowledge of the app economy,” he explains. “There are numerous commonalities and unresolved problems across these businesses, and we are uniquely positioned to provide solutions.”

Addressing Key Developer Needs

Specifically, RevenueCat intends to support developers in areas beyond billing and subscriptions, including customer acquisition – a challenge amplified by Apple’s anti-tracking technology (ATT) – and providing access to capital for apps experiencing cash flow limitations.

The company is also enhancing its core offerings, with improvements to point-of-purchase acquisition and the launch of new tools like a drag-and-drop paywall editor and support for virtual currencies.

Web Payments & the Apple-Epic Ruling

The Apple-Epic court decision spurred renewed interest in RevenueCat’s web billing engine, which entered beta last fall. The team had proactively developed this product in anticipation of the ruling, which mandated Apple to permit in-app links to external purchases without imposing commissions.

Currently, the tool competes with platforms like Stripe, Recurly, and Chargebee, but is specifically tailored to the requirements of mobile app developers. Over 2,000 developers are currently testing RevenueCat’s billing service.

Data-Driven Insights & Commission Evaluation

RevenueCat is not only providing the tools for adopting new technologies but also offering insights into their effectiveness. Through experiments conducted on Dipsea, a spicy audiobooks app acquired last year, the company is analyzing the impact of billing changes on app performance.

For instance, it may not be advantageous for smaller developers, subject to a 15% Apple commission, to independently manage payments due to the associated risks of chargebacks and fraud. These tests could provide valuable data regarding the true value of in-app purchases (IAPs) and potentially influence Apple’s commission structure.

The Impact of AI on App Development

“We’re pleased to be able to conduct these experiments, as Apple hasn’t done so,” Eiting remarked to TechCrunch. “We’re eager to gather data, settle the debate, or at least contribute to a more informed discussion.”

Another significant factor influencing RevenueCat’s business is the rise of artificial intelligence. The company provides payment infrastructure to clients like OpenAI for its ChatGPT app and other AI model providers.

Furthermore, RevenueCat is witnessing a surge in “vibe-coded” apps – applications created by developers utilizing AI-powered coding tools. Eiting shared an anecdote about a student who built a basic app within two months using AI, despite having limited programming experience.

“This dramatically compresses the development timeline,” he observed. “This shift will have profound effects on the economy, the full extent of which we cannot yet comprehend.”

This trend may lead RevenueCat to collaborate with companies offering AI-powered coding solutions.

Future Growth & Strategic Acquisitions

The new funds will also facilitate the development of future products, talent acquisition, and strategic mergers and acquisitions to accelerate growth.

“We’ve become proficient at assembling focused engineering and product teams to tackle specific challenges,” Eiting concluded. “We aim to scale this capability as much as possible.”

Note: This article has been updated to reflect the precise number of mobile apps utilizing the RevenueCat platform (over 70,000) and to clarify that Mark Fiorentino invested in RevenueCat while at Index Ventures before joining Bain Capital Ventures, maintaining the investor relationship.