1.
The World is Moving to a Subscription Economy

2.
Amazon Prime slide

3.
United slide

4.
Confidential and Proprietary Information. Do not distribute beyond intended audience.
HIGH TECH
SAAS
CLOUD
MEDIA
DEVICES
TELECOM EDUCATION
HEALTH CARE
FINANCIAL
SERVICES
CONSUMER

5.
Zuora Receives £36m For
European Expansion
It’s Spreading Around the Globe

6.
It’s Invading F500 BoardroomsIt’s Invading F500 Boardrooms

7.
You are the Face of Innovation today

8.
You are the Unstoppable

9.
1 New Product
Created Every Hour
On Average …

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

11.
20Billion
Contracted Invoice Volume

12.
Staying ahead of the UnstoppableStaying ahead of the Unstoppable

13.
25X 10X60X
Faster Syncs Faster bill runs More capacity

14.
Exponential
investments in
customer success
2012 2013

15.
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,

16.
So What’s Next?

17.
“What is the best way to price?”

18.
“How do I reduce churn?”

19.
“How should I compensate my sales force?”

20.
“How do I reduce the number of failed credit
card transactions?”

21.
“Should I charge a setup or implementation
fee?”

22.
“How do I account for multi-year contracts?”

23.
“As I expand internationally, what payment or tax
issues will I encounter?”

24.
“Should I offer monthly or annual billing periods?”

25.
“I wish there was a blueprint”

26.
What if We Could Create a Blueprint

27.
We analyzed 6 years of data

28.
You are trying to Price
Acquire
Bill
Collect
Nurture
Account
Measure
Iterate
Scale

29.
Price
11%
Acquire
12%
Bill
14%
Collect
12%
Nurture
11%
Account
11%
Measure
9%
Iterate
11%
Scale
9%
Support Cases Categorized By 9 Things

30.
Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

31.
Confidential and Proprietary Information. Do not distribute beyond intended audience.

32.
Simple per-unit
pricing
Infinite
pricing options

33.
2220000000
?
A new way to think about pricing

34.
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

35.
TheAbility to
Price in support of your business goals
is the first Key for
Success in the Subscription Economy

36.
It sounds easy

37.
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

38.
We live in a B2Any
world
B2C B2B

39.
The Ability to
Quickly Acquire Customers in a B2Any World
is the second Key for
Success in the Subscription Economy

40.
Andrew Lam-Po-Tang

41.
Billing used to be simple
Ship Bill

42.
$10
new
customers
Existing
customers
Pro-rate Usage
Ship Bill

43.
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”

44.
The Ability to
Create Accurate, Clear Invoices at Scale
is the third Key for
Success in the Subscription Economy

45.
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

46.
The need to automate
ACH

47.
Handling of Exceptions

48.
The Ability to
Tame the Complexity of Payments
is the fourth Key for
Success in the Subscription Economy

49.
Bill Plummer

50.
Build Valuable Relationships

51.
The Secret:
Give Customers Control of the
Relationship

52.
Remember the
2nd Key:
Acquire?
Subscribe

53.
That Was Just
the Beginning
Subscribe
Renew
Suspend
Add-on
Upgrade

54.
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

55.
The Ability to
Nuture And Develop Deeper Customer
Relationships
is the fifth Key for
Success in the Subscription Economy

56.
Andre Pimentel

57.
“I’ve got this massive spreadsheet I use
to track Revenue”

58.
“It’s Taking Longer and Longer to Close
My Books”

59.
“It’s becoming harder to harder to
reconcile financial info across all my
different systems”

60.
“The IT department used to be known
as Dr. No …. But now, it’s the finance
department”

61.
There’s no accounting for subscriptions
Booking
Subscription
Billing
Cash
Revenue

62.
The Ability to
Easily and Quickly Account for
Bookings, Billings, Cash and Revenue
is the sixth Key for
Success in the Subscription Economy

63.
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

64.
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

65.
Your current applications don’t give you
the metrics you need

66.
The Ability to
Instantly Access
Subscription Economy Metrics
is the seventh key for
Success in the Subscription Economy

67.
Chuck Best

68.
Pricing iteration is crucial to support growth

69.
You can’t afford this …
“The next available engineer
will see you in 6 months”

70.
The ability to
Rapidly Iterate On Your Pricing and
Acquisition Strategies
is the eighth key for
Success in the Subscription Economy

71.
Why build all this into your service?
Pricing
Payments
Taxation
Billing
Rev Rec
Secure
Mission Critical
Scalable
Rating

72.
When you could do this?

73.
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

74.
The ability to
Run on a Scalable, Reliable, Mission
Critical Infrastructure
is the ninth key for
Success in the Subscription Economy

75.
Cathy MacDonald

76.
Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

77.
There have been moments where we took
a leap forward in our understanding of the
world

78.
1789
1215
1687
1905
1980
2013

79.
Today we are taking a leap forward,
together, in our understanding of the
Subscription Economy

80.
Mike Pearl, PwC
AJ Bernstein, Acxiom

81.
Confidential and Proprietary Information. Do not distribute beyond intended audience.
Introducing
the
9
Keys
to
Success
in
the
Subscrip2on
Economy

82.
We are wrapping everything we do at
Zuora around these 9 Keys

83.
Our Second Announcement

84.
Why Are We Here?

85.
Why is the Subscription Economy an
Unstoppable Force

86.
There is a Better Way of Doing Business

87.
Win / Win Relationships
Transfer of Assets
not

88.
Stable Recurring Revenue Built on
Loyal Customers
Massive investment of capital with
unpredictable outcomes
not

89.
Efficient use of resources
More Pens, More Cars, More Phones,
More Landfills
not

90.
Subscription Business Model
Is The Better Way

91.
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

92.
If You Believe in a Better Way to Build a
Business
Join the Revolution
Sign the Manifesto