Best Payment Tools for SaaS MVPs
Stripe vs. Paddle vs. LemonSqueezy — an honest comparison from someone who's wired all three
Payments are the part of a SaaS MVP where the wrong choice costs you the most time to fix later. I've integrated Stripe for subscription SaaS and one-time platforms, and evaluated Paddle and LemonSqueezy seriously. Here's the honest breakdown.
The most flexible payments API — best for SaaS subscription billing
Stripe's subscription model (Customer → Product → Price → Subscription) is the right abstraction for SaaS. The webhook system for subscription lifecycle events is reliable and well-documented. The downside: Stripe doesn't handle EU VAT as a merchant of record. If you're selling to European consumers and don't want to deal with VAT registration, look at Paddle.
Handles all tax compliance globally — best for selling SaaS internationally
Paddle acts as the merchant of record — they handle EU VAT, US sales tax, and international tax compliance on your behalf. For a solo founder selling globally without a dedicated finance function, this is worth the slightly higher fee. Paddle Billing (their newer product) has a cleaner API than their legacy checkout.
Simpler merchant-of-record alternative — good for digital products
LemonSqueezy is easier to set up than Paddle and handles merchant-of-record tax compliance. Better for simpler pricing models — one-time products, simple subscriptions. Stripe-level flexibility on complex billing (usage-based, add-ons, trials) isn't there yet. Good for an information product or simple SaaS with straightforward pricing.
Stripe for billing, TaxJar for US sales tax automation
If you're selling primarily to US businesses (B2B), Stripe + TaxJar handles sales tax without switching to Paddle. TaxJar integrates with Stripe to calculate and remit state sales tax automatically. This is the right setup for B2B SaaS targeting US enterprise customers where VAT isn't the primary concern.
Default to Stripe for SaaS MVPs. Switch to Paddle if your customer base is international consumers and you don't want to manage VAT. LemonSqueezy is fine for simple digital products but not the right tool for complex SaaS billing. Whatever you pick, architect around webhooks — never trust client-side payment state for access control.