NitroPack and FastSpring: A Case Study

How NitroPack Grew by 628% With FastSpring

Key Result

628% increase in revenue

Industry

IT Services and Consulting

Headquarters

Sofia City, Bulgaria

The Company

NitroPack, a website performance optimization platform, has become one of the fastest-growing startups in CEE. Since it joined FastSpring in early 2020, the company has increased its revenue by 628% and is still growing fast.

When NitroPack was first getting started, they used PayPal to accept and process payments. “It was out of the box for us, and we didn’t want to spend time integrating anything,” Nitropack cofounder Georgi Petrov explained.

This solution lasted less than a month. 

As soon as they launched, NitroPack began bringing in revenue. And they immediately began to see issues using PayPal as the foundation of their payment stack: “The moment we realized that our SaaS was going to be making more money in the next months, we realized that we had a payment issue, and we needed to be able to scale.”

 

“FastSpring is really helpful for doing global business outside of the EU. Even if I were choosing FastSpring now, I wouldn't choose something else given the convenience and the problems it solved for us.”

Georgi Petrov, CEO

The Challenge

EU tax compliance is an issue when you use PayPal as the foundation of your payment stack.

NitroPack faced two issues trying to scale using PayPal.

1. With PayPal, You’re Not Automatically Sales Tax and VAT Compliant

The biggest issue was tax compliance. Since NitroPack was originally founded in Bulgaria and started out selling in other EU countries, making sure they were calculating and collecting the correct value-added tax (VAT) was very important.

“That’s actually the super big problem for all EU SaaS founders,” Georgi explained,  “because being in the EU, you need to take care of these things from the very beginning.”

The problem? PayPal doesn’t automatically calculate VAT for you, and since every country in the EU does VAT a little differently, it’s a big headache to set it up on your own.

And for EU-based companies, this is just the beginning. Once you start doing business in the US, Canada, and other major markets, you’ve also got to figure out where you’re required to collect and remit other forms of consumption taxes like sales tax and GST — and each tax region has its own regulations (that are changing all the time).

2. PayPal Doesn’t Offer Great European Invoicing Options

The other compliance challenge NitroPack faced as a B2B company was sending EU-required VAT invoices.

Using PayPal, software companies can send U.S.-style receipts and invoices, but the payment platform doesn’t create the type of invoices that the EU requires for most B2B transactions.

The Solution

Georgi quickly realized that his company would need to find a solution that would help the company stay compliant with EU regulations. And that’s how he found FastSpring.

“We were searching for a solution that would solve all of our problems at once. FastSpring was super open: thinking in our shoes, like how to solve our problems, and it was an easy decision.”

The Results

NitroPack has now been with FastSpring for three years, and we’ve been proud to partner with them as they’ve grown. Here are important ways that FastSpring has helped NitroPack scale.

1. Using FastSpring, NitroPack Stays Compliant All Around the World

NitroPack now has customers all over the world, and with global growth comes global complexities.

As their merchant of record, FastSpring helps NitroPack stay compliant all around the world. Our platform calculates VAT, sales, and GST taxes and collects them on behalf of our customers. Our team of tax professionals remits those taxes and takes the lead in any audits.

We also keep track of global payment regulations like PCI DSS and the EU’s changing VAT regulations so that NitroPack doesn’t have to.

“FastSpring is really helpful for doing global business outside of the EU. Even if I were choosing FastSpring now, I wouldn’t choose something else given the convenience and the problems it solved for us.”

2. NitroPack Maintains Rich and Easy-to-Use Self-Serve Subscriptions

Using FastSpring’s subscription management features, NitroPack offers free and tiered plans with monthly and annual rates. NitroPack’s plans include a usage-based component, as well. Companies can sign up and pay online and log into their customer portal to make plan changes.

“Being a merchant of record, FastSpring takes care of the different dynamics during the purchase process: if someone wants a refund, someone wants to change something in their subscription, the card is not valid anymore and needs to be updated, and so on. And we just get the aggregated payout, something that simplifies quite a lot of our internal billing and counting,” Georgi said.

3. NitroPack Relies on FastSpring’s Hands-On Support and Customer Success Team

Like any SaaS company, NitroPack continues to innovate on its product and subNitroPack constantly pushes the envelope with new features, product updates, and flexible subscription models. Their team needs a payment platform that matches their inventive nature and acts as a growth partner. NitroPack has a dedicated customer success manager and access to FastSpring’s support team. 

“If you operate only on a self-serve basis and communicate only through support chat forums and the product, sometimes you end up in a situation where no one can help you, and you just churn. That’s not the case with FastSpring.”

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