Subscribed 2011 Keynote -- The Death of ERP


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  • Welcome the audience
  • We made a bold prediciton 4 years ago, that we were moving to a subscription economyBut you, in this room, are the leaders that made that happenYou are paving the wayYou are the ones telling us how this future is being shapedIt is because of you, that Gartner now predicts
  •’s Idea for a talking point:I use salesforce to check the forecast, check with my dev team using GoGrid to host, remote calendar on Time Trade.... And you are all customers & PRESENT TODAY...c
  • There is going to be a mass migration away from Oracle and SAP
  • Thanks. Partnership.Your successBuilt for you---------I want to personally thank you for being here. I am very excited to have the opportunity to present our product vision.The turnout shows that you look at it the same way we do – as a true partnership.We love our customers. It’s our number one strategic objective and we live it and breath it everyday.We believe that our success is driven only by your success. We are in it for you to win it.Everything you’ll see here today is built around enabling your success.
  • Incredible MomentumAs you can see, we’ve been working on this for 3+ years, delivering awesome features every monthWe’ve been growing and investing1-5, 10-60In fact, we’re accelerating that growth. Expect to double the team again in the next 12 month
  • And now,We’re Expanding into Two New Strategic AreasI’ve got some incredible new products to show youAnd I can’t wait to tell you about them…But…
  • But before we get into the details of these new products,Let me tell you a little about our philosophy.
  • Slide TitleYou are all PMsYour feedback, your pain points, your needs100s last 12 monthsEverything is from you
  • Very good. Now let’s talk about our products
  • Started with billing because that’s the first pain point you hit.We recognized that your ERP systems don’t understand subscription billing complexity.World class subscription Billing is what got us here. That’s how we filled the room today right?And even thought we’ll be talking about two new product today, we continue to invest in billing.Kyle, one of our senior product guys, is going to give you a preview of some of this great work---- AFTERIncredible new capabilities.As I said, billing is the foundation, and we are going to continue to invest in this areaBut…
  • Slide TitleSo what’s next?
  • Slide titleWhy commerce?Where the money isConnection to the customerThese days, that’s how you keep up with the competitionSo what are we doing?
  • Slide titleWe’re building it around the lifecycle. You don’t just buy anymore (example)We’re making it easy. You have to be able to react quickly without requiring IT and development resources. Who has time to wait for that?We’re making it accessible anywhere. In your front office tools like Salesforce. On your website. On any mobile device.There are 2 new products we’re excited about.
  • We’ve built a simple new way to put commerce on any website or device. Something we’re calling Z-Checkout.Please welcome ben, senior product guy, to get into the details. I know you’re going to like this.-------- AFTERFantastic Ben. No coding. Ben is making it his personal mission to keep your developers focused on their real day jobs.
  • Dreamforce is happening this week and I’m sure many of you are attending.That makes this a great time to talk about our Z-Force product.For those of you that don’t already know, Z-Force has been a key component of our strategy from they very beginning.It's our native app built specifically for subscription commerce within Salesforce.Here to tell you more about how we're extending commerce in Z-Force, is Mandar, our senior product guy-----------Thanks Mandar. Some incredible functionality. The real-time upsell and product offering in the iPad app was awesome. That truly is the future of commerce.
  • Truly is slide titleRead bullets
  • We’ve talked about our foundation and continued investment in billingWe’ve talked about how we’re making commerce easy and anywhere via Z-checkout and Z-ForceBut we’re not stopping there…
  • Before I tell you what’s next…. Slide titleThere’s something we haven’t talked about. Something people don’t want to bring up. The big elephant in the subscription commerce room.
  • But people are sufferingMany of your are in this roomAnd as sales and marketing thrive on the subscription economy…
  • Why is finance suffering? Why are they in a dark place?Because : TitleFinance can’t get a single real-time view into the businessWhy hasn’t someone already solved this problem?Because it is really hard. Data is siloed.B, BC, R
  • What if you could do it in Zuora?What if it was automatic, in real-time, as orders come into the system?
  • Slide titleGame changer.Never been Done. May not be sexy, but this the final frontierReal-time, blah….This is bigger than billing.This is the most important thing we’ve ever doneBring NetSuite experience in. Experienced the pain. Saw the trends. That’s why I joined Zuora.
  • To realize this vision, we’re working on two brand new products.Z-Finance and Z-Revenue.John Banks, another senior product guy, is going to tell us about it.
  • Slide titleWe are making commerce easy and available anywhereWe are extending our lead in billing.We are embarking on the final frontier, embracing finance and delivering unprecedented accounting and revenue functionalityAs Tien said, we believe ERP is going to be irrelevant in 5-10 years.But let’s be clear. We’re not arrogant enough to suggest that Zuora is going to make ERP irrelevant.The market is making ERP irrelevant. You are making ERP irrelevant.And Zuora has already emerged as THE enterprise business application powering the subscription economy.Thanks to all my senior product guys for their incredible work.Thanks to everyone in the audience for their help in building this vision, and for being pioneers in the subscription economy.Thanks for partnering with Zuora as we realize our vision.All of my product guys will be available after the session to answer questions and take feedback. I encourage you to track them down.Thanks again. And I’ll turn the stage over to Jeff to talk about what’s next at Zuora day.
  • Subscribed 2011 Keynote -- The Death of ERP

    1. 1. Welcome to our first everZuora Customer Day
    2. 2. We’re Here to Today… Celebrate You! 2010 2009 20082007 In short order, Zuora has become the dominant player in cloud-based subscription systems.
    3. 3. You Have Created the Subscription Economy BUY NOW 2001 2011By 2015, 35% of Global 2000 companies will generaterevenue through subscription-based services andrevenue models. April 2011: Building a Strategy for the Subscription Economy
    4. 4. What is theSubscription Economy?
    5. 5. The Subscription Economy is an END GAME …the end game of where technology is goingMobile Cloud Social222 Million iOS 90k Amazon Virtual 750 MillionDevices Sold Machines Added Daily Facebook Users The future…is hardware, software and connectivity combined with specific services.
    6. 6. The Subscription Economy is an IDEA…that consumers today would rather subscribe than buy. 8:30am Grab a shared bike for the morning commute 10:00am Rock out to Pandora at desk 12:30pm Send payment for this month’s apartment rent 2:00pm Pickup ZipCar to get to lunch meeting 4:30pm Book vacation stay on Air BnB 6:00pm Pick up month’s veggies from Farm Fresh to You 8:00pm Life for the Fire up Netflix to stream a movie Subscription Generation 2010 Viacom DVD Sales: Down 44% 2010 Netflix Subscribers: Up 62%
    7. 7. The Subscription Economy is an IDEA …that businesses are tired of up front capital costs. $45,000 $40,000 IDC World-Wide SaaS $35,000 Revenues & Projections $30,000Millions $25,000 $20,000 $15,000 $10,000 $5,000 $0 2009 2010 2011 2012 2013 2014 Stated simply, using SaaS frees up cash for other uses in the enterprise.
    8. 8. The Subscription Economy is a BUSINESS MODEL …that delivers compound recurring revenue.$10,000 “Upside Subscription Business” $8,000 • 20% Customer Growth • 10% Customer Up-sell $6,000 “Subscription Business” • 20% Customer Growth $4,000 $2,000 “Transactional Business” • 20% Customer Growth $0 Every dollar a cloud company brings in is considered to be worth six times as much as the dollar brought in by a company that gets most of its money the old way - upfront.
    9. 9. The Subscription Economy a BUSINESS MODEL …favored by Wall St. and Sand Hill Rd.12x 9x 9x Subscription Transaction 5x 3x 4x Valuations IPO Market (Revenue Multiples) (2011)
    10. 10. This is a Fundamental Shift in How We Build Businesses
    11. 11. Transaction Focused Customer Focused BUY NOW
    12. 12. Envision a great new product Identify a great customer segment Spend months or years designing it Roll out initial service in weeks or months Focus group the product Measure customer usage Pick the product price Iterate on pricing and packaging Plan product sales & distribution Develop customer upgrade path Track total product revenues Track total customer value Start over with the next product Upgrade and renew customerSony Owns the Customer Zynga Owns the Customer
    13. 13. Incumbents In Every Industry Are Being Disrupted BUY NOW GAMING TRANSPORTATION TRAVEL MOVIES
    14. 14. But There’s a Problem…
    15. 15. But how do you run acustomer focused company……with systems builtaround transactions?
    16. 16. I just want to know how many active customers I have. What’s a customer? Howabout I tell you how manyorders were placed lastmonth?
    17. 17. I just need to offer monthlypay-as- you-go pricing. Just create a newSKU for every monthyou want to bill.
    18. 18. I just want to process upgrades and renewals. What’s an Upgrade?All I can really do is a“Buy” transaction. BUY NOW
    19. 19. I just want to sell to both individuals and enterprises. High HighVolume Complexity Whoa, slow down. I can’t send out that many invoices at a time. You should do all this in a payment gateway.
    20. 20. I just want a unified view of how my business is performing.Bookings Billings & Cash Revenue Gonna be tough, because bookings live inSalesforce and Revenue is in a spreadsheet.
    21. 21. The Subscription EconomyMakes Your ExistingSystems IRRELEVANT.
    22. 22. Our Prediction:In 5-10 Years, no one will beusing SAP or Oracle.
    23. 23. The Subscription Economy Demands a New Platform BUY NOW
    24. 24. A New Platform that Puts the Customer at the Center Customer Centric Metrics
    25. 25. A New Platform that Lets You Pricethe Way Customers Want to Subscribe Customer Centric Plan Based Pricing Catalog
    26. 26. A New Platform that SupportsLifecycle Order Management Lifecycle Order Management
    27. 27. A New Platform that SupportsHigh Volume B2C and High Complexity B2B B2Any
    28. 28. A New Platform that UnifiesCommerce, Billing, and Finance Subscription Financials
    29. 29. We’ve Been Building This Foundation for 4 Years We found Zuora and the light bulb went off: a business operations platform designed especially for subscription businesses like ours.
    30. 30. Our Vision:The World’s First Platform for the Subscription Economy BUY NOW
    31. 31. Our Vision:A Platform that You Can Run Your Business On
    32. 32. Our Vision:The Death of ERP
    33. 33. It’s Time to Unveil Our Vision.
    34. 34. A New Platform for theSubscription EconomyLuke Braud, VP Products & Engineering
    35. 35. Today We’ll See The Future of Zuora Oct ‘08 Jan ‘09 Sept ‘09 June ‘10 Nov ‘10 May ‘11 Z-Payments Z-Commerce Zuora Zuora Z-Payments 3.0 Z-Suite for Media for CloudMay ‘08Z-Billing Nov ‘08 Z-Force April ‘09 Z-Billing 2.0 Nov ‘09 Z-Payments 2.0 July ‘10 Z-Force 3.0 Dec ‘10 Z-Force 4.0 Next? 2008 2009 2010 2011 2012 1 Product Managers 5 Developers 10 Product Managers 60 Developers
    36. 36. We’re Expanding into Two New Strategic Areas Subscription Billing ??? ???
    37. 37. But First, Our Philosophy…
    38. 38. We Build Product Around Your Needs Time-based discount charge model Payment notifications engine Invoice subscriptions separately Since we became a Zuora Auto price increases on renewalcustomer, weve come to expect Account credit balancethem to deliver innovation at animpressive pace. Payment updater Aggregate usage across accounts Subscription amendment previews Hundreds of New Features Bill period of any number of months In the Last 12 Months Payment re-try logic Default evergreen subscriptions Rolling usage smoothing
    39. 39. Let’s Talk About the Products
    40. 40. It Started With Subscription Billing Subscription Product Catalog High Volume B2C Billing High Complexity B2B Billing Subscription Bookings Metrics
    41. 41. We’re Going Beyond Billing Subscription Billing??? ???
    42. 42. First Stop: Subscription Commerce SubscriptionCommerce Where the money is Connection to the customer Keep up with competition
    43. 43. We’re making Subscription Commerce Easy & Anywhere web crm zuora mobileMust be a Must be Must beLifecycle Easy Everywhere
    44. 44. Commerce Easy & Anywhere with Z-Checkout Commerce Secure & No Coding Anywhere PCI Compliant Needed
    45. 45. Z-Force Brings Commerce to With Z-Force, we’re automating quotes and orders for our expanding business. Commerce in Powerful Fully Reporting Customizable
    46. 46. Subscription Commerce: Easy & Everywhere Commerce Anywhere Secure & PCI Compliant No Coding Needed Commerce in Powerful Reporting Fully Customizable
    47. 47. But Wait…There’s More Subscription SubscriptionCommerce Billing ???
    48. 48. The Subscription Economy Has a Dirty Secret…
    49. 49. Marketing Loves It. Sales Loves It.It so easy to launch new I get to sell into my install and get creative with Love those easy upgrades andpricing & packaging. renewals.
    50. 50. But People Are Suffering…
    51. 51. Finance Toils Alone in the Dark. Why don’t the bookings from sales ever line up with my billings estimates? Great…with all these early renewals I’m going to have to re-do my cash forecast.One-time usage use recurring charges onthe same invoice? How am I supposed torecognize revenue for this?
    52. 52. No One Has Ever Delivered a Complete System for the Subscription Economy.Bookings Billings & Cash Revenue
    53. 53. What if You Could Do it All in Zuora?
    54. 54. That’s Exactly What We’re Doing. The final frontier: Real-Time bookings, billings, ca sh, & revenue… …finally together in one place.
    55. 55. Two Exciting New Products
    56. 56. Z-Finance Makes Zuora Accounting Aware Accounting IMG - COA Aware Revenue Sub-Ledger
    57. 57. Revenue Recognition is as Painful as Billing I spend way more time doing rev rec than getting bills out. I can’t launch the pricing and packaging Iwant because my revenue team won’t let me. I manage rev rec in 7 different spreadsheets.
    58. 58. Revenue Recognition is 10x Harder in the Subscription EconomyOver time vs. all at once BookingsMultiple charge typesLifecycle changes: BillingsUpgrade, Add-on, Suspension CashAlign billing cycle withaccounting periods RevenueArcane accounting rules:EITF08-1, 09-3, VSOE, multi-element, fair value
    59. 59. Revenue Recognition is the Final Piece of the Puzzle Bookings Billings Cash Revenue
    60. 60. The World’s First Application Suite Built for the Subscription Economy Subscription Subscription SubscriptionCommerce Billing Finance
    61. 61. Special Announcements Earn Points for Charity: Tweet, Video, Q&A Find us at Dreamforce. Booth #1114. Shoot a Video Win Cash Today Special Game: Prizes Every Find All Customers 15 Minutes @ Dreamforce and Win $2,000Please be back in 15-minutes for the breakout sessions.
    62. 62. Thank You!