A core piece of USV’s thesis has long been around an enablement layer – the idea that horizontal tooling is essential to support growing ecosystems that sit on top. That belief has led to investments like Twilio, Shippo, Sift, Clarifai, and MongoDB. These products have the great benefit of dual strategy growth – they scale through adding new customers as well as working with businesses from early stages that scale on top of them. By doing so, at best, they become part of the fabric of how an ecosystem functions. My partner Fred described the idea now a decade ago as: “When an enterprise plugs into a network of developers and tools built in this way they get more than functionality. They get a platform that a lot of engineers know how to use and is becoming a standard in the market.” 

Today, the software ecosystem continues to accelerate faster than ever. As it does, one of the fundamental elements has become how customers pay for software tools and the emergence of usage-based, or metered, billing. This approach lowers the barrier to adoption of new tools and allows a customer to start at low cost; it eliminates any issue around number of users who can use a software tool; and, most importantly, it is necessary in a world where, increasingly, more interactions will be software-to-software than human-to-software over time. 

But while usage-based billing grew 32% from 2020 to 2021 and continues to climb, implementing it to date has been difficult. It has been a missing piece of the software enablement layer. We learned this directly when Zack Kanter, CEO of portfolio company Stedi, went out to search for a provider for his business and struggled to find one. After an exhaustive search, he landed on m3ter – a London-based metering and pricing engine for SaaS businesses, started by two founders, who, as former leaders at AWS, had learned the usage-based billing market from the product that does it the best. 

Stedi became the first m3ter customer, Zack an investor and evangelist, and soon, we were lucky to be on board, too. As we diligenced with our portfolio, we found the difficulty Zack encountered to be consistent. There was a long list of portfolio companies to ask about this pain. For the earlier companies exploring usage-based pricing, it was generally an unsolved problem; many of the later stage companies had been forced to build it themselves after failed attempts with partners. This set of conversations resulted quickly in several other portfolio companies eager to join the initial set of m3ter customers. 

Today, m3ter comes out of stealth with $17.5M funding and a quickly growing customer list. We are excited to team up with Kindred Capital, Insight, Box Group, and Zack (thanks, Zack!) and to work with John and Griffin in building the standard in the usage-based billing market.

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