The Novation Launchpad can be used as a step sequencer in Ableton Live. Novation has a free patch for users of (the pricey) Max for Live, but with a little creativity you make it a step sequencer without this add-on. The Belgian minimal techno and electro artist DJ Aurex has developed four solutions, and offers them on his website for free.
The Aurex Launchpad Sequencers include 8-Step, Troxic, Masher and SampleDeck. These are offered in the form of Live Sets, the file format of Ableton Live.
The 8-Step sequencer is a melodic step sequencer, which allows you to experiment with sounds and melodies. Troxic is a drum machine you can play live with 38 samples. Of course you can load your own sounds. In the following video Aurex demonstrates Troxic:
Masher is an effect sequencer for mangling tracks. And SampleDeck is for realtime sampling and remixing.
More information about the step sequencers can be found on the website of Aurex. You can also make a donation if you like them.