2. The World is Moving to a Subscription Economy

7. Amazon Prime slide

8. United slide

11. Confidential and Proprietary Information. Do not distribute beyond intended audience.
HIGH TECH
SAAS
CLOUD
MEDIA
DEVICES
TELECOM EDUCATION
HEALTH CARE
FINANCIAL
SERVICES
CONSUMER

12. Zuora Receives £36m For
European Expansion
It’s Spreading Around the Globe

13. It’s Invading F500 BoardroomsIt’s Invading F500 Boardrooms

14. You are the Face of Innovation today

15. You are the Unstoppable

16. 1 New Product
Created Every Hour
On Average …

17. 10X transaction growth in 12 months
10,012,288
1,536,533
AUG
2012
AUG
2013

18. 20Billion
Contracted Invoice Volume

19. Staying ahead of the UnstoppableStaying ahead of the Unstoppable

20. 25X 10X60X
Faster Syncs Faster bill runs More capacity

22. Exponential
investments in
customer success
2012 2013

23. 100
90 93 91
95 98
94 96 97 97
0
25
50
75
100
Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13
“Matt replied in moments and I am
happy with how he handled my issue”
Kristi,
“I love Zuora support. You guys
really do a great job”
Harsh,
“Cesar was awesome. Very
thoughtful and helpful”
Alan,

26. So What’s Next?

27. “What is the best way to price?”

28. “How do I reduce churn?”

29. “How should I compensate my sales force?”

30. “How do I reduce the number of failed credit
card transactions?”

31. “Should I charge a setup or implementation
fee?”

32. “How do I account for multi-year contracts?”

33. “As I expand internationally, what payment or tax
issues will I encounter?”

34. “Should I offer monthly or annual billing periods?”

35. “I wish there was a blueprint”

37. What if We Could Create a Blueprint

38. We analyzed 6 years of data

39. You are trying to Price
Acquire
Bill
Collect
Nurture
Account
Measure
Iterate
Scale

40. Price
11%
Acquire
12%
Bill
14%
Collect
12%
Nurture
11%
Account
11%
Measure
9%
Iterate
11%
Scale
9%
Support Cases Categorized By 9 Things

41. Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

43. Confidential and Proprietary Information. Do not distribute beyond intended audience.

44. Simple per-unit
pricing
Infinite
pricing options

45. 2220000000
?
A new way to think about pricing

46. Increase
Cash Flow
Drive Down
Cost of Sales
Outflank the
competition
Grab Market
Share
Increase
Loyalty and
Retention
Pivot into a
new segment
Expand
Internationally

47. TheAbility to
Price in support of your business goals
is the first Key for
Success in the Subscription Economy

49. It sounds easy

50. Billing
Gateways
fulfillment
provisioning
Immediate or
delayed payment
Connect to
CRM
Notify
Connect to
accounting
Self service vs
assisted flows
But it’s Harder Than It Seems

51. We live in a B2Any
world
B2C B2B

52. The Ability to
Quickly Acquire Customers in a B2Any World
is the second Key for
Success in the Subscription Economy

53. Andrew Lam-Po-Tang

55. Billing used to be simple
Ship Bill

56. $10
new
customers
Existing
customers
Pro-rate Usage
Ship Bill

57. Confidential and Proprietary Information. Do not distribute beyond intended audience.
Confused
customers
Weeks
to
generate
bills
Billing
Errors
Lost
Revenue
1
2
3
4
Every bill is an interaction with your customer
“But
I
signed
up
for
the
$100/month
plan”

58. The Ability to
Create Accurate, Clear Invoices at Scale
is the third Key for
Success in the Subscription Economy

60. Electronic payments Non-electronic payments
Credit Cards Debit Cards Wire transfers
Catch exceptions
Multiple card types
Country specific
banking rules
Retries Card updaters
Manual Lockbox
Receive
payment
Notify delinquents
Write off payment ReconcileSuspend service

61. The need to automate
ACH

62. Handling of Exceptions

63. The Ability to
Tame the Complexity of Payments
is the fourth Key for
Success in the Subscription Economy

64. Bill Plummer

66. Build Valuable Relationships

67. The Secret:
Give Customers Control of the
Relationship

68. Remember the
2nd Key:
Acquire?
Subscribe

69. That Was Just
the Beginning
Subscribe
Renew
Suspend
Add-on
Upgrade

70. Sign
up
Validate
CC
Validated
Create
Bill
Process
Payment
Create
Account
Link
Account
Confirm
Sign
Up
Welcome
Email
Create
Subscrip2on
Provision
Service
WEBSITE
BILLING
CRM
PLATFORM

72. The Ability to
Nuture And Develop Deeper Customer
Relationships
is the fifth Key for
Success in the Subscription Economy

73. Andre Pimentel

75. “I’ve got this massive spreadsheet I use
to track Revenue”

76. “It’s Taking Longer and Longer to Close
My Books”

77. “It’s becoming harder to harder to
reconcile financial info across all my
different systems”

78. “The IT department used to be known
as Dr. No …. But now, it’s the finance
department”

79. There’s no accounting for subscriptions
Booking
Subscription
Billing
Cash
Revenue

81. The Ability to
Easily and Quickly Account for
Bookings, Billings, Cash and Revenue
is the sixth Key for
Success in the Subscription Economy

83. You used to track these metrics
Revenue
$100
COGS
(30)
Gross
Profit
70
Opera2ng
Expenses
S&M
(20)
G&A
(10)
R&D
(20)
Total
Op
Ex
(50)
Net
Income
$20

84. Now you track these metrics
ARR
$100
Churn
(10)
Net
ARR
90
COGS
(20)
G&A
(10)
R&D
(20)
Recurring
Profit
40
Growth
(40)
Net
New
ARR
40
Ending
ARR
$130

85. Your current applications don’t give you
the metrics you need

86. The Ability to
Instantly Access
Subscription Economy Metrics
is the seventh key for
Success in the Subscription Economy

87. Chuck Best

89. Pricing iteration is crucial to support growth

90. You can’t afford this …
“The next available engineer
will see you in 6 months”

91. The ability to
Rapidly Iterate On Your Pricing and
Acquisition Strategies
is the eighth key for
Success in the Subscription Economy

93. Why build all this into your service?
Pricing
Payments
Taxation
Billing
Rev Rec
Secure
Mission Critical
Scalable
Rating

94. When you could do this?

95. Integrate with an ecosystem that supports
your service
Customer
support
Inventory
Fulfillment
EnDtlements
Website
Provisioning
Commerce
Billing
Finance
Payments
GL
quoDng
orders
invoices
checks
events
account
status
account
balance
metrics

96. The ability to
Run on a Scalable, Reliable, Mission
Critical Infrastructure
is the ninth key for
Success in the Subscription Economy

97. Cathy MacDonald

98. Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

99. There have been moments where we took
a leap forward in our understanding of the
world

100. 1789
1215
1687
1905
1980
2013

101. Today we are taking a leap forward,
together, in our understanding of the
Subscription Economy

102. Mike Pearl, PwC
AJ Bernstein, Acxiom

103. Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

104. We are wrapping everything we do at
Zuora around these 9 Keys

105. Our Second Announcement

106. Why Are We Here?

107. Why is the Subscription Economy an
Unstoppable Force

108. There is a Better Way of Doing Business

109. Win / Win Relationships
Transfer of Assets
not

110. Stable Recurring Revenue Built on
Loyal Customers
Massive investment of capital with
unpredictable outcomes
not

111. Efficient use of resources
More Pens, More Cars, More Phones,
More Landfills
not

112. Subscription Business Model
Is The Better Way

113. Today, businesses must focus on
• Deeper customer relationships versus one-time
transactions
• Fair, value-based pricing versus fixed, cost-plus
pricing
• Efficient, consumption-based services versus shipping
unit after unit
• Sustainable, forward-looking revenue versus
backwards-looking financial reporting

115. If You Believe in a Better Way to Build a
Business
Join the Revolution
Sign the Manifesto