1. Welcome
to our first ever
Zuora Customer Day

2. We’re Here to
Today…
Celebrate You!
2010
2009
2008
2007
In short order, Zuora has become the
dominant player in cloud-based
subscription systems.

3. You Have Created
the Subscription Economy
BUY NOW
2001 2011
By 2015, 35% of Global 2000 companies will generate
revenue through subscription-based services and
revenue models.
April 2011: Building a Strategy for the Subscription Economy

4. What is the
Subscription Economy?

5. The Subscription Economy is an END GAME
…the end game of where technology is going
Mobile Cloud Social
222 Million iOS 90k Amazon Virtual 750 Million
Devices Sold Machines Added Daily Facebook Users
The future…is hardware, software and connectivity
combined with specific services.

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. 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
$30,000
Millions
$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. 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. 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. This is a Fundamental Shift in
How We Build Businesses

11. Transaction Focused
Customer Focused
BUY NOW

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 customer
Sony Owns the Customer Zynga Owns the Customer

13. Incumbents In Every Industry Are Being Disrupted
BUY NOW
GAMING
TRANSPORTATION
TRAVEL
MOVIES

14. But There’s a Problem…

15. But how do you run a
customer focused company…
…with systems built
around transactions?

16. I just want to know
how many active
customers I have.
What’s a customer? How
about I tell you how many
orders were placed last
month?

17. I just need to offer monthly
pay-as- you-go pricing.
Just create a new
SKU for every month
you want to bill.

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. I just want to sell to both
individuals and enterprises.
High High
Volume 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. I just want a unified
view of how my
business is performing.
Bookings Billings & Cash Revenue
Gonna be tough, because bookings live in
Salesforce and Revenue is in a spreadsheet.

21. The Subscription Economy
Makes Your Existing
Systems IRRELEVANT.

22. Our Prediction:
In 5-10 Years, no one will be
using SAP or Oracle.

23. The Subscription Economy Demands a New Platform
BUY NOW
http://www.readwriteweb.com/cloud/2010/06/zuora-announces-z-commerce-for.php

24. A New Platform that Puts the
Customer at the Center
Customer Centric
Metrics

25. A New Platform that Lets You Price
the Way Customers Want to Subscribe
Customer
Centric
Plan Based
Pricing Catalog

26. A New Platform that Supports
Lifecycle Order Management
Lifecycle
Order Management

27. A New Platform that Supports
High Volume B2C and High Complexity B2B
B2Any

28. A New Platform that Unifies
Commerce, Billing, and Finance
Subscription
Financials

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. Our Vision:
The World’s First Platform for the Subscription Economy
BUY NOW

31. Our Vision:
A Platform that You Can Run Your Business On

32. Our Vision:
The Death of ERP

33. It’s Time to Unveil Our Vision.

34. A New Platform for the
Subscription Economy
Luke Braud, VP Products & Engineering

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 Cloud
May ‘08
Z-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. We’re Expanding into Two New Strategic Areas
Subscription
Billing
??? ???

37. But First, Our Philosophy…

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 renewal
customer, we've come to expect
Account credit balance
them to deliver innovation at an
impressive 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. Let’s Talk About the Products

40. It Started With Subscription Billing
Subscription Product Catalog
High Volume B2C Billing
High Complexity B2B Billing
Subscription Bookings Metrics

41. We’re Going Beyond Billing
Subscription
Billing
??? ???

42. First Stop: Subscription Commerce
Subscription
Commerce
Where the money is
Connection to the customer
Keep up with competition

43. We’re making Subscription Commerce
Easy & Anywhere
web crm
zuora mobile
Must be a Must be Must be
Lifecycle Easy Everywhere

44. Commerce Easy & Anywhere with Z-Checkout
Commerce Secure & No Coding
Anywhere PCI Compliant Needed

45. Z-Force Brings Commerce to Salesforce.com
With Z-Force, we’re
automating quotes and
orders for our expanding
business.
Commerce in Powerful Fully
Salesforce.com Reporting Customizable

46. Subscription Commerce:
Easy & Everywhere
Commerce Anywhere
Secure & PCI Compliant
No Coding Needed
Commerce in Salesforce.com
Powerful Reporting
Fully Customizable

47. But Wait…There’s More
Subscription Subscription
Commerce Billing
???

48. The Subscription Economy
Has a Dirty Secret…

49. Marketing Loves It. Sales Loves It.
It so easy to launch new I get to sell into my install base.
services and get creative with Love those easy upgrades and
pricing & packaging. renewals.

50. But People Are Suffering…

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 on
the same invoice? How am I supposed to
recognize revenue for this?

52. No One Has Ever Delivered a Complete System
for the Subscription Economy.
Bookings Billings & Cash Revenue

53. What if You Could Do it
All in Zuora?

54. That’s Exactly What We’re Doing.
The final frontier:
Real-Time
bookings, billings, ca
sh, & revenue…
…finally together in
one place.

55. Two Exciting New Products

56. Z-Finance Makes Zuora Accounting Aware
Accounting IMG - COA
Aware
Revenue
Sub-Ledger

58. 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 I
want because my revenue team won’t let me.
I manage rev rec in 7 different
spreadsheets.

59. Revenue Recognition is 10x Harder
in the Subscription Economy
Over time vs. all at once
Bookings
Multiple charge types
Lifecycle changes:
Billings
Upgrade, Add-
on, Suspension Cash
Align billing cycle with
accounting periods
Revenue
Arcane accounting rules:
EITF08-1, 09-
3, VSOE, multi-
element, fair value

60. Revenue Recognition is the Final Piece of the Puzzle
Bookings
Billings
Cash
Revenue

61. The World’s First Application Suite
Built for the Subscription Economy
Subscription Subscription Subscription
Commerce Billing Finance

62. Special Announcements
Earn Points for Charity: Tweet, Video, Q&A
http://zuora.influitive.com/
Find us at Dreamforce. Booth #1114.
Shoot a
Video Win Cash
Today Special Game:
Prizes Every
Find All Customers
15 Minutes @ Dreamforce and
Win $2,000
Please be back in 15-minutes for the breakout sessions.

63. Thank You!