Zuora, which offers a billing, commerce and finance PaaS for businesses using a subscription-service model, has raised $50 million in E series funding from some major players. Next World Capital, Vulcan Capital and Northgate Capital are the latest additions to the company’s crowd of believers. Zuora will use the money to expand into new markets and geographies and invest in R&D. “This isn’t just about taking HR or storage into the cloud,” said CEO and cofounder Tien Tzuo. “This is a fundamental change in consumer behavior.”
50MM is a great validation of the continuing pressure of companies to adapt to new business models, but I think your point on what do customer really want / need is well stated. A ready example is Adobe who has convinced the financial markets their shift to subscriptions works, the rise of customer complaints, many who rightly point to the fact Adobe really hasn't changed the product, yet will charge them for perpetuity - works for some, but not for everyone. If anything, this points to the need to support multiple revenue models - perpetual, freemium, fractional ownership, subscriptions, as well as others yet to become the next hot thing.
That said, subscription focused billing engines are necessary, but not enough. While subscriptions represents a fundamentally new revenue model, today's vendors need to compete with new business models --> namely the ability to create new revenue streams, reach new markets direct or through resellers, expand how they monetize at each customer touch point, support new revenue models with billing systems, and quickly orchestrate new ecosystems in markets now disrupted by cloud/mobile/social ... in these cases, vendors need to rethink commerce.
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Investors Toss $50 Million Zuora's Way
Posted by: Richard Adhikari September 6, 2013 05:00 AMZuora, which offers a billing, commerce and finance PaaS for businesses using a subscription-service model, has raised $50 million in E series funding from some major players. Next World Capital, Vulcan Capital and Northgate Capital are the latest additions to the company’s crowd of believers. Zuora will use the money to expand into new markets and geographies and invest in R&D. “This isn’t just about taking HR or storage into the cloud,” said CEO and cofounder Tien Tzuo. “This is a fundamental change in consumer behavior.”
That said, subscription focused billing engines are necessary, but not enough. While subscriptions represents a fundamentally new revenue model, today's vendors need to compete with new business models --> namely the ability to create new revenue streams, reach new markets direct or through resellers, expand how they monetize at each customer touch point, support new revenue models with billing systems, and quickly orchestrate new ecosystems in markets now disrupted by cloud/mobile/social ... in these cases, vendors need to rethink commerce.