Published on the 16/03/2015 | Written by Beverley Head
A global shift toward subscription style business models has helped deliver a US$115 million funding kicker to Zuora…
Demand for cloud-style solutions has placed subscription software company Zuora on a steep growth trajectory.
Zuora co-founder and CEO Tien Tzuo said demand for the company’s systems across A/NZ was also growing, with organisations such as Deloitte, Fairfax Media and Telecom NZ now signed as customers. “When you look at the customer base, it’s lots of telecoms, tech and media,” he said during an interview with iStart on the eve of the funds injection last week.
But he said that even industrial and manufacturing companies, such as Schneider were now also “joining the subscription economy”.
Having joined Salesforce as employee number 11, Tzuo had already experienced corporate appetite for services that were bought on a pay-as-you-go basis and built Salesforce’s first billing system.
Zuora’s relationship business management platform allows companies to manage subscribers from acquisition, through recurring billing and payments, revenue recognition and subscription metrics.
Tzuo said that the latest round of funding – which takes the total invested in the company to US$250 million since it was founded in 2007 – would fuel international expansion and support the company’s growth. Over the last year Zuora has seen traffic through its servers more than double. The latest round of funding reportedly values the business at close to US$1 billion.
“We don’t want to be in a position where we can’t keep up with the growth,” he said. Tzuo added that in the long-term the company would likely go public, although it is “not in a rush, it is not in the timeline”.
Australian growth has been very strong since the company first opened local offices in 2012. Local revenues rose 150 percent during the last year. Tzuo said that the company had opened new offices in Sydney’s CBD, now had a team of around 20 people in place, and supported 25-30 regional customers.
Internationally during 2014 Zuora grew revenues 109 percent, while its platform handled subscription invoices worth US$42 billion.
