Cloud-based subscription software startup Zuora had a strong debut on Wall Street with share jumps nearly 43% on first day of trading
Wall Street loves the San Mateo, California-based cloud-based subscription software startup. Zuora stock opened at $20 a share, above its Wednesday night pricing of $14 a share, and jumps nearly 43% on first day of trading to close at $20. Zuora priced its 11 million shares at $14 on Wednesday, above a revised expected range of $11 to $13, which translate to a valuation of just more than $1.4 billion. Zuora is currently the only provider of the SaaS platform that automates all subscription order-to-cash operations in real-time for any business. The company helps businesses manage subscription services with billing and analytics offerings.
The company reported a net loss of $47.2 million for the year ended Jan. 31, on revenue of $167.9 million, which was up about 49 percent from a year ago. Zuora listed its $154 million initial public offering on the New York Stock Exchange (NYSE) under the ticker symbol “ZUO.” Zuora had a sales revenue of $168 million in the 12 months ended January 31, 2018. Goldman Sachs, Morgan Stanley, Allen & Company and Jefferies are the joint bookrunners on the deal.
Founded in 2007 by Cheng Zou, K.V. Rao and Tien Tzuo, Zuora provides a cloud-based subscription billing and management platform. Zuora is a leader in cloud-based subscription SaaS market. It’s the only provider of SaaS platform that automates all subscription order-to-cash operations in real-time for any business. Companies in any industry can launch new businesses, shift products to subscription, implement new pay-as-you-go pricing and packaging models, gain new insights into subscriber behavior, and disrupt market segments to gain competitive advantage.
There’s a big, big secular shift going on where companies aren’t selling products anymore. More and more they’re subscribing to services,” Tzuo told CNBC’s “Squawk on the Street” Thursday. “We’re the company really powering this, and we’re the company uniquely positioned to benefit from this secular shift,” said the Zuora CEO, Tien Tzuo.
Zuora currently serves nearly 1,000 companies around the world in a wide range of industries, including Box, Komatsu, Rogers, Schneider Electric, Toshiba, Xplornet and Zendesk. The Subscription Economy Index (SEI) demonstrates that SEI companies are growing revenues approximately nine times faster than the S&P 500. Headquartered in Silicon Valley, Zuora also operates offices in Atlanta, Boston, Denver, San Francisco, London, Paris, Beijing, Sydney, Chennai and Tokyo. The company’s solutions cover subscription packaging catalog, subscription lifecycle management, hosted B2C commerce pages, REST and SOAP store front APIs and libraries, automated invoicing, electronic payment collections, taxation, chart of accounts management, accounting close capabilities, file-based GL integration, dashboards, two factor authentication, data sources, and premier support. It provides its solutions to industries such as cloud services, communications, media, and healthcare industries worldwide.