Challenge

Amid the explosion of generative AI capabilities in late 2022, the founders of Leonardo AI spotted an opportunity and launched a free platform for image and video creation. Just three months later, they had built a global base of 100,000 users in marketing, advertising, gaming, and design, and they were ready to monetize.

With the AI space evolving quickly, the Sydney-based Leonardo AI team anticipated rapid expansion. They needed a financial infrastructure partner that could support that scale, along with the flexibility to evolve with the pace of change in AI graphics. They were looking for a solution that was ready to use off the shelf, but that could also be customized as their needs changed. “We need every engineer we have to be working on our core platform,” said Chris Gillis, cofounder and COO of Leonardo AI. “Pulling even one or two off to work on optimizing a payment processing solution is just going to lose us our competitive advantage.”

Leonardo AI’s global audience meant the company required financial infrastructure technology that could accommodate numerous local currencies and payment methods. The company also needed to ensure it complied with local tax regulations wherever it operated and minimized the impact of fraudulent transactions. Given the complexity of these issues, Leonardo AI wanted to automate as much as possible to optimize speed to market.

Since Leonardo AI was scaling quickly, it required solutions that would deliver targeted, real-time business analytics to inform executive decision making. “Our number-one priority is flexibility and timeliness,” said Gillis. “That way we can experiment and be ready to pivot really quickly toward what the market’s demanding.”

Solution

Once Leonardo AI decided to monetize its platform, its founders opted to partner with Stripe to support its billing and payment needs. They chose Stripe Billing, an automated solution for managing recurring revenue, paired with Stripe’s Optimized Checkout Suite, which includes embeddable UI components and the ability to turn on additional payment methods without having to complete individual integrations. Stripe Checkout offers a prebuilt payment form that is optimized for conversion and built for more than 30 languages and more than 135 currencies, as well as a variety of popular payment methods. Implementing the Optimized Checkout Suite allowed Leonardo to offer Link, which autofills customers’ payment information to create an accelerated and secure checkout experience.

Once Leonardo AI started acquiring paying customers, it began partnering with Stripe on revenue retention strategy. To reduce failed payments and churn, Stripe automated failed payment reminders and email notifications about upcoming card expiration for Leonardo AI’s customers.

Stripe Tax allowed the company to automate taxes on all its transactions. With a single integration, Tax calculates, collects, and reports tax on transactions in more than 60 countries and all US states. Tax also tracks and applies changes in global tax rules and rates—an especially important consideration as Leonardo AI grew. Leonardo AI also adopted Stripe Radar, which detects and blocks fraud using machine learning that trains on data across millions of global companies.

The company uses Stripe Sigma, which allows businesses to explore and analyze their Stripe data and generate business insights from the Stripe Dashboard. Sigma accepts both SQL and natural language prompts to produce quick answers to important questions.

Results

Leonardo AI launches in weeks thanks to ease of implementation

The flexibility of Stripe technology made it easy for Leonardo AI’s engineers to complete the integration and monetize its business in weeks, rather than months, according to Gillis. “One of the reasons we used Stripe is that there were a lot of tools ready to go in it, and it made it very quick to get online,” said Gillis, who noted that Checkout is the company’s “bread and butter.” “If we didn’t have Stripe’s off-the-shelf solution, it would have taken us months to monetize, and we would have had to hire a consulting firm rather than doing it ourselves,” he said.

Payments and Billing drive a frictionless customer experience and recover 40% of failed payments

By partnering with Stripe, Leonardo AI could rely on a robust recurring payments engine from Day 1. The company also benefited from Stripe’s built-in authorization optimizations. Smart Retries, which addresses insufficient funds declines by using AI to identify the optimal day and time to retry a payment, recovers more than 40% of Leonardo AI’s failed payments—a rate that is more than 5x the software industry average.

In addition, the combination of Adaptive Acceptance, card account updater, and network tokens led to a 2.15% increase in Leonardo AI’s payment success rate over the last year.

“Stripe Billing really allows us to streamline our backend efficiency so we can focus on our core product,” said Gillis.

Optimized Checkout Suite supports payment from customers in 189 countries

With customers on every continent, Leonardo AI benefited from how simple the Optimized Checkout Suite makes it to offer the most popular payment methods around the world. In 2024, the company accepted payment from customers in 189 countries thanks to its Stripe integration.

Proactive monitoring with Stripe Tax supports compliance

Leonardo AI is currently registered for tax in Australia, the EU, the UK, and Canada, and it’s using Stripe to monitor tax in 89 jurisdictions. The consolidated platform, including Payments and Billing, is a time-saver for Leonardo AI’s team, which otherwise would have required additional headcount or to outsource manual tax reconciliation.

As Leonardo AI’s COO, Gillis particularly appreciates that Stripe proactively notifies the company via the Dashboard and by email if it’s doing enough business in a certain jurisdiction that it meets the threshold to register, collect, and pay taxes. Stripe Tax has been “invaluable,” he said.

Minimal staff time needed for fraud prevention

Radar’s zero-code solution is seamlessly integrated with other Stripe products. As a result, the company is able to fight fraud automatically and use a streamlined process to dispute chargebacks, with minimal intervention from the Leonardo AI team. When customization is needed, Radar provides the flexibility they need to set rules.

Sigma provides access to bespoke reports on business intelligence

Gillis calls Sigma a “world-class” reporting tool that has allowed Leonardo AI to create bespoke reports to analyze key business trends that inform its strategy going forward. “It allowed us to get early insight into the business—where our customers were, what they were using the product for, their patterns—and it’s very engineer-friendly,” he said.

Building a flexible, scalable foundation for further growth

In mid-2024, Leonardo AI was acquired by Canva, vastly expanding the company’s potential user base and allowing it to focus on visual AI research and product development. With Stripe handling billing, payments, taxes, and more, Gillis and his team are free to focus on their core business, including expanding the company’s audience to include enterprise customers. “We’re really excited to go bigger and better and focus on what we love doing, which is building the best quality product possible,” he said.