Challenge

MagicSchool launched in 2023 with a mission to help educators unlock every student’s full potential by giving teachers more time to teach, more tools to inspire, and more ways to personalize learning. By harnessing the power of AI to simplify teacher workloads, MagicSchool helps more than five million teachers focus on connecting with students instead of manually building lesson plans, writing Individualized Education Programs (IEPs), and adapting content.

After successfully launching its free tool, MagicSchool was ready to implement a freemium model that would give teachers and school districts access to advanced features through paid upgrades. The company needed billing technology that would integrate easily with its platform, support its product vision, and reduce involuntary churn—all while delivering a fast checkout process for teachers who often upgrade between classes on mobile devices. MagicSchool required a solution versatile enough to handle everything from self-serve individual billing to multiseat enterprise accounts, with international scalability and robust compliance for PCI, SCA, and tax regulations as it managed sensitive payment data from educational institutions.

Solution

At the end of 2023, MagicSchool integrated Stripe as it prepared to launch MagicSchool Plus, its paid offering that includes more advanced features. “Stripe stood out for its seamless APIs, best-in-class reliability, and built-in compliance, which is crucial for handling sensitive school and district data,” said Todd Tobin, chief technology officer at MagicSchool. “Stripe’s ability to scale from early stage to enterprise grade made it the clear partner to grow with us.”

MagicSchool’s engineering team used Stripe Billing to quickly automate seat-based billing, seat upgrades, subscription renewals, and targeted back-to-school promotions for its self-serve plans without extensive backend development. MagicSchool also implemented Smart Retries, which uses AI to recover failed payments automatically, along with automatic email dunning campaigns to reengage customers whose payments had failed.

MagicSchool used Stripe’s Optimized Checkout Suite, which includes Stripe Checkout—a prebuilt payment form embedded directly into its site—to create a frictionless, mobile-optimized payment flow with no coding required. With the Optimized Checkout Suite, MagicSchool can now accept multiple payment methods—including credit and debit cards, Apple Pay, and ACH bank transfers—for enterprise invoicing. Going forward, MagicSchool can easily add new payment methods and currencies as it expands globally. The company also adopted Link, a wallet built by Stripe, which MagicSchool used to further simplify the checkout process by enabling users to complete transactions with a single click.

MagicSchool also used Stripe’s built-in compliance features to handle sensitive school and district payment data securely. Automated tax calculation and data security protocols ensure compliance with PCI, SCA, and other regulatory standards.

Results

MagicSchool implemented Stripe in two weeks

MagicSchool integrated Stripe at the end of 2023, allowing it to launch its paid offerings in January 2024—in time for school districts to include the platform in their 2024–2025 school year budgets.

“We embedded Stripe Checkout directly into our MagicSchool Plus sign-up flow. It took two developers a few weeks to fully integrate,” said Tobin. “Prebuilt secure flows meant we didn’t need to custom build billing UIs. We went live with a branded, compliant, and mobile-friendly checkout experience almost immediately.”

Quick, simple checkout drove conversion rate growth

With the Optimized Checkout Suite, MagicSchool created a fast, mobile-optimized checkout experience that lets teachers upgrade plans quickly. “Teachers value speed,” said Tobin. “Link helps us offer a one-click experience that reduced the steps required to upgrade for returning users. It fits perfectly with our goal of removing barriers to adoption.”

Finance saved hours per week with automation

By using Billing to automate billing and seat upgrades, MagicSchool was able to save its finance and sales operations teams hours per week, so they could focus on strategic growth initiatives rather than repetitive billing tasks.

“Stripe has helped us scale with confidence by streamlining our finance operations, supporting sales with faster invoicing, and helping us serve both individual teachers and large districts with equal ease. It enabled our team to focus on product and growth, not backend billing complexity,” said Tobin.

Stripe Billing reduced churn

The Smart Retries and automatic email dunning campaigns built into Billing helped MagicSchool reduce involuntary churn, helping recover revenue from failed payments while minimizing disruptions for teachers and school districts.

MagicSchool is now positioned for global expansion

Thanks to Stripe’s ability to add new payment methods and currencies, MagicSchool can now confidently operate beyond the US. The company plans to add new Stripe products to further automate compliance and reporting in order to support its growth.

“As we grow, we’re looking to deepen our Stripe integration by exploring Revenue Recognition, Tax, and Sigma to further automate reporting and compliance. We also plan to localize payment options as we expand internationally,” said Tobin. “Stripe will be a core infrastructure partner as we scale access to AI-powered tools for educators around the world.”

MagicSchool ensured compliance and data security

Stripe’s support for PCI, SCA, and tax compliance gave MagicSchool the confidence it needs to manage sensitive payment data for teachers. “That built-in support was a major win for our small team,” said Tobin.