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MGI 360 Ratings - Zuora March 27 2015 Billing Management Systems

Rating: 61 out of 100 - up from 60

Outlook: POSITIVE

Opinion: We are increasing the MGI 360 Rating of billing software supplier Zuora to 61 from 60 and re-iterate a POSITIVE outlook.

We increase the MGI 360 rating of Zuora from 60 to 61 and re-iterate POSITIVE outlook. Zuora remains the most recognizable brand in the cloud billing space. During 2014 Zuora grew to over 550 paying customers while broadening its product platform beyond billing to commerce and financial close capabilities. Over the last 24 months company has refocused on larger opportunities and generated a number of high profile wins. With headcount above 500, Zuora is on a $75Mil (MGI est.) annual revenue run rate while dramatically expanding its sales force. On March 10th the company closed $115 Million Series F round of funding with participation of new investors such as Blackrock and Wellington Asset Management. Zuora has significantly improved its execution of product implementations with a repeatable, agile approach. Best fit for Zuora product 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.                                                                                                                                                   

Company: Zuora was founded in 2007 by former Webex and Salesforce.com execs K.V. Rao, Cheng Zou and Tien Tzuo and has raised over $250Million in VC and institutional funding. Zuora sells its solutions via a direct sales force and leveraging partnerships with companies such as Salesforce.com, Accenture, Deloitte and PwC.  Zuora has expanded its geographic presence in Europe and began to build a presence in Asia.  Zuora brand visibility, funding, pure-cloud architecture, rapid deployment methodology and size of its channel separate Zuora from the rest of the next-generation, SaaS-only vendors.

Competitors: Aria Systems, SAP/BRIM, Monexa, Metratech/Ericsson, Transverse,  Fusebill. Peer group is made up of 15 companies.                                                                                                                                                                                                                                                                                      

About MGI 360 Ratings

MGI 360 Ratings is a comprehensive system for evaluating technology companies. IT organizations use MGI 360 to track suppliers, assess purchasing risks and identify promising new vendors. Vendors utilize MGI 360 to track their markets and evaluate partners. Institutional Investors use MGI 360 for independent assessment of tech companies. MGI 360 ratings help lower costs, save time, reduce risks, and identify new opportunities.

The MGI 360 ratings are on a scale from 0 to 100 and reflect company opinions of MGI analysts in five key areas on a scale of 0 to 20:

  • PRODUCT: How strong is the product competitive position
  • MANAGEMENT: How competent and experienced is the management team
  • CHANNELS: Does the company have a sales capability and channels needed to bring products to market
  • STRATEGY: Does the company have a realistic view of the opportunity and a compelling strategy for success
  • FINANCE: Is the company growing and profitable.

Each of these key criteria is subdivided into numerous sub-categories. In total, over 125 criteria are combined to generate an MGI 360 rating in each specific market space. Companies can have one or more MGI 360 rating - one for each market. MGI 360 ratings are revised as important developments occur. While the MGI 360 rating process is comprehensive, this scoring system is not meant to be a predictor of company solvency, liquidity, absence of accounting fraud or stock performance. Access to MGI 360 Ratings is by subscription.

About MGI Research

MGI Research is an independent industry research and advisory firm focused on disruptive trends in the technology industry. Through subscription research, advisory engagements, industry studies and ratings, MGI Research helps clients identify opportunities for reducing IT costs and minimize technology risks. MGI Research analysts work closely with user organizations to create practical strategies for new technology initiatives such as mobile, virtualization, SaaS and cloud computing and make timely go/no-go IT investment decisions.

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