OPINION: We are increasing the MGI 360 rating of Zuora from 60 to 61 and reiterate a Positive outlook. Zuora remains the most recognizable brand in the cloud billing space. During 2014, Zuora’s paying customers grew to over 550 while the company broadened its product platform beyond billing to commerce and financial close capabilities. Over the last 24 months, the company has refocused on larger opportunities and generated a number of high profile wins. With headcount above 500, Zuora is on a $75 million (MGI estimate) annual revenue run rate while dramatically expanding its sales force. On March 10, 2015, the company closed a $115 million Series F round of funding with participation of new investors such as Blackrock and Wellington Asset Management. The company has significantly improved its execution of product implementations with a repeatable, agile approach. The best fit for the Zuora solution are projects that need rapid time-to-market with medium transaction volumes and typical to medium transaction complexity across a spectrum of company sizes.
In a companion research note published on March 27, 2015, “Zuora After the Funding – The Outlook“, we review our outlook for Zuora in more detail.
Zuora was founded in 2007 by former Webex and Salesforce.com executives K.V. Rao, Cheng Zou, and Tien Tzuo and has raised over $250 million in venture capital and institutional funding. Zuora sells its solutions via a direct sales force and through leveraging partnerships with companies like Salesforce.com, Accenture, Deloitte, and PwC. Zuora has expanded its geographic presence in Europe and started to build a presence in Asia. The company’s brand visibility, funding, pure-cloud architecture, rapid deployment methodology, and size of channel separate it from the rest of the next generation, SaaS-only vendors.
COMPETITORS: Aria Systems, Fusebill, Metratech/Ericsson, Monexa, SAP/BRIM, Transverse. Zuora’s peer group is comprised of 15 companies.
