Unified monetization platform startup Stigg Inc. says it’s ready to help businesses implement more dynamic and flexible pricing strategies after closing on a $17.5 million early-stage round of funding today.

The Series A round was led by Red Dot Capital Partners and saw participation from Unusual Ventures, Emerge Ventures, Cerca Partners and Redseed, and adds to the $6.5 million in funding the startup had previously raised.

Stigg’s monetization platform is designed to help companies of all shapes and sizes modernize their payment and billing infrastructure, so they can iterate on new payment models much faster than before.

Companies need to do this, Stigg argues, because the rapid adoption of generative artificial intelligence in software-as-a-service products is transforming the way software is sold. These days, businesses must be able to support numerous models and revenue channels at once, such as consumption-based pricing and AI credits, as well as subscription models and those based on usage.

The challenge is that standard billing systems don’t support this kind of flexibility. Generally, they’re integrated with products in an ad hoc way, which means engineering teams have to spend weeks or even months making complex changes across their billing infrastructure, customer relationship management systems and product platforms.

Stigg changes that. It’s a kind of middleware that sits between SaaS-based applications and the billing infrastructure, where it facilitates the rapid rollout of flexible pricing plans, including hybrid models, bundles, usage-based billing and more.

It makes it simple for engineering teams to model all of the different features and functionality within software products that can potentially be monetized. They can flexibly define and organize offerings across products, plans, packages and add-ons, without making any substantial code changes. So instead of cobbling together different feature flags and data pipelines, businesses can access a unified system to quickly orchestrate changes to the way they bill customers for using their apps.

One of the key features of Stigg’s platform is that it enables developers to build granular access at the feature level, using a flexible domain model. At the core of its platform is an “entitlement management” application programming interface that deals with configuration, metering and access control. That API connects with various third-party billing systems, customer relationship management services, pricing pages and product experiences, making it simple to deploy and experiment with new monetization plans.

Stigg co-founder and Chief Executive Dor Sasson (pictured left, alongside Chief Technology Officer Anton Zagrebelny)
said monolithic billing systems are a legacy concept that dramatically slows business growth, hindering companies’ efforts to iterate on new pricing models.

“Companies need the flexibility to serve different market segments differently, especially as they layer in AI capabilities and expand into new channels,” he explained. “We’re giving engineering teams the infrastructure to help businesses move faster. After adopting Stigg and rapidly deploying new pricing models and AI features, our clients massively exceeded their quarterly revenue targets, which shows the power of getting monetization infrastructure right.”

The startup claims that it’s already managing billions of API calls and tens of millions of monthly subscriptions for its customers, including the AI collaboration platform Miro Inc., generative AI model creator AI21 Labs Inc., web design firm Webflow Inc. and the application observability firm PagerDuty Inc.

Atad Peled of Red Dot Capital said he’s investing in Stigg because he has witnessed dozens of teams at his portfolio companies struggle to adapt their monetization infrastructure to support new AI features and business models

“Stigg’s technology addresses a critical pain point that’s only growing more acute,” he said. “The company’s zero churn rate and strong customer momentum demonstrates that it has built something truly essential for modern software companies.”

Photo: Roei Shor