Challenges

Chatwork started offering its service in 2011 and has since become the largest domestic Japanese business chat platform. It has been installed by more than 431,000 companies and has approximately 6.64 million registered IDs, with over 1.1 million daily active users (DAU), as of the end of 2023. One characteristic of the service is that approximately 90% of its users are employees of small or medium-sized businesses with 300 employees or less. Chatwork aims to become the number one business chat service for small and medium-sized businesses, providing the communication infrastructure to support the digital transformation of the small and medium-sized business that make up more than 99% of Japanese companies.

Chatwork wanted to expand its user base, but faced challenges with invoicing and payments, which form the basis of its subscriptions. Before introducing Stripe, billing, functions, and users were all managed through internal tools. According to Shigetoshi Kasuga, who supervises product development as head of Chatwork’s technical infrastructure strategy office, resources from the development team had to be used to implement changes to fees and plans and respond to unusual situations because Chatwork handled too much of the payment-related processing work in-house.

“The real value offered by a SaaS service is raising the quality of the service itself and increasing customer satisfaction, thereby attracting more users,” said Kasuga. “Previously, engineering resources that should have been dedicated to developing new service functions and improving usability were allocated to back-end work and systems such as payments and invoicing. This presented a significant problem for expanding the service and growing the business.”

Kasuga says that there are three main reasons Chatwork chose Stripe as its payments platform. Stripe’s performance and scalability allows Chatwork to integrate with a variety of other services, and is highly scalable. With Stripe, Chatwork can manage estimates, invoices, payments, and billing through a single platform.

“The second reason is its reliability. The number of companies with Chatwork installed has increased, and it has become increasingly important to provide a stable service 24/7,” said Kasuga. “Stripe has a full suite of developer-oriented features, such as API interfaces and data models, and provides detailed logs regarding systems, which makes it easy to diagnose issues when they arise.”

Finally, Stripe’s ease of migration and flexible pricing structure—which includes set pricing, volume-based pricing, tiered pricing, and usage-based pricing—made it possible for Chatwork to adjust trial periods for contracts, apply specific discounts, customize promotion codes, and more.

Results

In July 2023, Chatwork migrated its subscription billing management, which had been done internally up to that point, over to Stripe Billing.

“Looking at the Chatwork service as a whole, we determined that we could ensure the flexibility we needed by using an external, specialized service for managing billing and invoicing. By keeping function and user management internal and having Stripe handle all of the billing management, the upkeep required by our company and our resulting workload has been significantly reduced,” said Kasuga.

Chatwork is already seeing the benefits of moving to Stripe. “We revised our pricing structure in July 2023, something that would have taken six months before. Using Stripe, we were able to finish in about a month,” said Kasuga. “By allowing Stripe to handle as much of the payments-related work as possible, we’re able to focus our engineering resources on improving our service. We feel that we’ve created an environment where we can offer a better service to our users.”

As the service scales, payments risks also increase. Chatwork is considering introducing Radar, which prevents fraudulent activity by applying machine learning to large quantities of data. The vast majority of Japanese companies are small or medium-sized. As part of the communication infrastructure that supports the digital transformation of these companies, Chatwork wants to work with Stripe to create a seamless payments platform that anyone can easily use.

Number of companies with Chatwork installed

Over 431,000, number of registered IDs: 6.64 million, DAU: 1.108 million (As of the end of December 2023)