Essay on Zuora Venturing Into Cloud Computing

1426 Words May 21st, 2012 6 Pages
Zuora Inc: Venturing into Cloud Computing

EXECUTIVE SUMMARY
Zuora Inc. is a leading start-up company in the Software as a Service (SaaS) billing and payments area, which needs to strategically position itself in the face of the emergence of Cloud Computing. There is a need to identify the market segments that would provide Zuora with the quickest growth opportunity in order to strengthen its lead position, and they must decide how fast to scale the company given the changing market dynamics. These decisions will have implications for when the next round of funding must be secured, and top management must carefully assess what the effects of the timing of the funding decision will have on the valuation of the company.
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They place an emphasis on training, and communication and were successful at using a low-cost, high value approached mimicked the offshore approach, being able to accomplish their tasks faster and at a lower cost.
ALTERNATIVES AND RECOMMENDATIONS
Scenario 1 – Continue to focus on billing for the SaaS industry
Advantages
• The company already specializes in this market
• There is no need for additional investment and financing cash flow remains positive
• There is no need to hire additional staff
• Focus is to develop products that are suited to each customer’s needs
Disadvantages
• Small growth rate of 30-50% only
• There are many competitors in this business and with each focusing on specific target customers there is a loss of market opportunity
• There is a need to gain major partnership companies such as Amazon and Google, which will require the development of new tools for the company to grow.
• The technology changes fast and if not changing with it can create a loss of competitiveness in the long run.
Scenario 2 – Expand to capture the broader cloud computing trends
Advantages
• Cloud computing can be extended to industries with large market size
• Builds on the existing business with the ability to provide capabilities such as the Z-Payment service, Z-billing service on the cloud
• Business become comfortable with SaaS as they feel this is

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