San Francisco-based startup Metronome, specializing in usage-based billing solutions, has secured $43 million in a Series B funding round led by NEA, with participation from existing backers Andreessen Horowitz and General Catalyst. Since its inception in 2019, Metronome has raised over $78 million, reflecting its growing influence in the software billing sector.
Co-founded by former Dropbox executives Kevin Liu and Scott Woody, Metronome has experienced a remarkable 6x increase in Annual Recurring Revenue (ARR) in the past year. The surge is attributed to a rising trend among companies transitioning from traditional subscription models to usage-based billing or a hybrid of both. Metronome’s clientele includes notable names like OpenAI, Anthropic, Databricks, and Nvidia, with the startup expanding its focus from startups to enterprise-level organizations in the past year.
Kevin Liu, one of Metronome’s co-founders, highlighted the company’s resilience amid challenging times for Software as a Service (SaaS) providers. He emphasized that while many companies cut spending on non-essential software, Metronome stood out as a crucial driver of revenue opportunities for its customers. The growth is also linked to the increasing prominence of artificial intelligence (AI) companies adopting usage-based models, signaling a shift away from conventional subscription and seat-based approaches.
Metronome operates on a usage-based model itself, streamlining billing integration and maintenance processes for companies. The startup claims to significantly reduce the engineering investment required for these tasks. By offering a data platform with out-of-the-box integrations, Metronome enables engineering teams to launch products swiftly, set flexible pricing, and optimize quote-to-cash workflows without extensive engineering efforts.
While Metronome did not disclose its valuation, the founders mentioned that it reflects a “very healthy multiple above” its Series A valuation. With almost all of its Series A funds still available and strong demand, the startup experienced oversubscription during the funding round.
AI companies, in particular, find Metronome appealing due to its ability to handle the usage-based cost of goods sold (COGS) inherent in the entire AI stack, from APIs to GPU infrastructure layers. The startup reported significant interest from AI companies seeking to monetize new products.
In response to the growing demand, Metronome has doubled its headcount to 66 full-time employees over the past year, with plans for further expansion in its R&D and customer-facing teams. The newly acquired funding will be utilized to advance the company’s product roadmap and ensure a robust presence in the evolving software billing landscape.
As part of the funding round, NEA partner Hilarie Koplow-McAdams has joined Metronome’s board of directors, expressing confidence in Metronome’s ability to transform billing from a perceived bottleneck into a streamlined and efficient revenue driver for businesses.