Compare Stripe, Paddle, and Lemon Squeezy for AI SaaS billing -evaluating usage-based pricing, tax compliance, developer experience, and which platform fits AI business models.
TL;DR
| Feature | Stripe | Paddle | Lemon Squeezy |
|---|---|---|---|
| Fee structure | 2.9% + $0.30 | 5% + $0.50 | 5% + $0.50 |
| Merchant of record | No (you handle tax) | Yes | Yes |
| Usage-based pricing | Excellent | Good | Limited |
| Tax compliance | Manual (or Tax add-on) | Automatic | Automatic |
| Developer experience | Excellent | Good | Fair |
| Global reach | 195 countries | 200+ countries | 135+ countries |
| Webhooks | Comprehensive | Good | Basic |
| API quality | Excellent | Good | Fair |
Best for: AI products with usage-based pricing, developer-heavy teams, complex billing logic
Strengths:
Weaknesses:
AI-specific strengths:
Use cases:
Verdict: 4.7/5 - Best for serious AI businesses needing flexible pricing.
Best for: Global AI SaaS, teams wanting to offload tax/compliance, non-technical founders
Strengths:
Weaknesses:
AI-specific features:
Use cases:
Verdict: 4.3/5 - Best for simplifying global sales, worth premium for tax handling.
Best for: Indie hackers, small AI tools, rapid validation, digital products
Strengths:
Weaknesses:
AI-specific limitations:
Use cases:
Verdict: 4.1/5 - Great for getting started, outgrow quickly with complex needs.
Model: $20/month + $0.01 per 1,000 tokens beyond 100K monthly
Stripe implementation:
// Create subscription with metered usage
const subscription = await stripe.subscriptions.create({
customer: 'cus_123',
items: [
{ price: 'price_base_20' }, // $20/month base
{
price: 'price_tokens', // Metered: $0.01/1K tokens
billing_thresholds: {
usage_gte: 100000 // Free 100K tokens
}
}
]
});
// Report usage
await stripe.subscriptionItems.createUsageRecord(
'si_123',
{ quantity: 5000, timestamp: 'now' } // +5K tokens
);
Complexity: Moderate (code required) Flexibility: Excellent
Paddle implementation:
// Base subscription
const subscription = Paddle.Subscription.create({
plan_id: 'plan_base_20',
customer_id: 'cus_123'
});
// Usage tracking (basic)
// Charge overages as one-time fees
const charge = Paddle.Charge.create({
customer_id: 'cus_123',
amount: '5.00', // Manual calculation
description: '500K tokens'
});
Complexity: Higher (manual calculations) Flexibility: Limited
Lemon Squeezy: Not natively supported -would need workaround (manual invoices or tiered plans).
Winner: Stripe for AI usage-based pricing.
Scenario: AI SaaS with $10K MRR, 100 customers, average $100/month
Stripe:
Paddle:
Lemon Squeezy:
Scenario 2: AI SaaS with $100K MRR, 500 customers
Stripe:
Paddle/Lemon Squeezy:
Winner: Stripe significantly cheaper at scale.
Stripe (you're merchant of record):
Sales in EU → Must register for VAT
Sales in US → Nexus in multiple states
Sales globally → Complex tax obligations
Solution: Stripe Tax ($50/month + 0.5% fee)
Paddle/Lemon Squeezy (they're merchant of record):
Sales anywhere → Zero tax work
All compliance handled
No business entity required (Lemon Squeezy)
Winner: Paddle/Lemon Squeezy for tax simplicity.
Stripe:
// Excellent SDK, comprehensive docs
import Stripe from 'stripe';
const stripe = new Stripe(process.env.STRIPE_SECRET);
// Create subscription
const subscription = await stripe.subscriptions.create({
customer: customerId,
items: [{ price: priceId }],
payment_behavior: 'default_incomplete',
expand: ['latest_invoice.payment_intent']
});
// Webhooks (40+ events)
stripe.webhooks.constructEvent(body, sig, secret);
Quality: ⭐⭐⭐⭐⭐ (excellent)
Paddle:
// Good SDK, decent docs
import { Paddle } from '@paddle/paddle-node-sdk';
const paddle = new Paddle(process.env.PADDLE_API_KEY);
// Create subscription
const subscription = await paddle.subscriptions.create({
plan_id: planId,
customer_id: customerId
});
// Webhooks (20+ events)
Quality: ⭐⭐⭐⭐ (good)
Lemon Squeezy:
// Basic SDK, minimal docs
import { lemonSqueezySetup } from '@lemonsqueezy/lemonsqueezy.js';
lemonSqueezySetup({ apiKey: process.env.LS_API_KEY });
// Create checkout (UI-based, not API-first)
// Limited programmatic control
Quality: ⭐⭐⭐ (fair)
Winner: Stripe for API quality and documentation.
Choose Stripe if:
Choose Paddle if:
Choose Lemon Squeezy if:
Lemon Squeezy → Stripe: Easy (1-2 weeks)
Paddle → Stripe: Moderate (2-4 weeks)
Stripe → Paddle/Lemon Squeezy: Hard (3-6 weeks)
Expert quote (Patrick McKenzie, Stripe): "For AI businesses, usage-based pricing isn't optional -it's alignment with value delivered. Stripe's metered billing is built for this. Simpler tools work until your pricing evolves."
Athenic's billing evolution:
Phase 1 (MVP, 0-50 users): Lemon Squeezy
Phase 2 (Growth, 50-500 users): Stripe
Key insight: Start simple (Lemon Squeezy), migrate to Stripe when pricing complexity demands.
Yes, but losing usage-based flexibility may require pricing redesign. Customers must re-enter payment info.
Stripe (Smart Retries, Billing Portal). Paddle good. Lemon Squeezy basic.
Stripe: Via extensions. Paddle: No. Lemon Squeezy: No.
Stripe: Excellent (Stripe Invoicing). Paddle: Good. Lemon Squeezy: Limited.
All three support annual billing with discounts. Stripe most flexible (coupons, trials, etc.).
Stripe best for AI products with usage-based pricing (API calls, tokens, credits) -lowest fees and most flexibility justify tax complexity at scale. Paddle best for global AI SaaS wanting zero tax work, worth premium fees for compliance handling. Lemon Squeezy best for indie hackers and MVPs needing fastest setup, but limited for complex pricing. For serious AI businesses, Stripe recommended despite learning curve; for non-technical founders selling subscriptions globally, Paddle solid choice.
Winner: Stripe for AI products, Paddle for simplicity.
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