Tech Industry – Page 20

Billing Enters the SaaS Era

May 21, 2008 1 Comment

One of the things that I have been working on recently is research for billing systems for SaaS companies. One project I have been working on recently has the eventual need for billing for the SaaS offerings they will be releasing soon. The challenge has been the multi-tiered nature of the billing solution that is needed. Becuase of that, we came up with a naming system to minimize the confusion:

Patrons are the customers of the SaaS provider.
Customers are the customers of the Patrons

Not only must the solution handle billing for the SaaS provider’s patrons, but also handle billing pass through for the patron to charge their customers. And that pass through billing could be services or product based with each patron having a slightly different product offering.

The initial thought was that this would have to built internally, maybe using a combination of Sugar CRM and osCommerce. The problem was that we realized we would need to do too much meatball surgery on these systems to really get what we wanted. Also, we don’t need a full fledged CRM system, just a light customer database (at least initially, boiling the ocean was something we were fighting even though we could see the need for it down the road). Then on top of all this, we still needed to work with a payment system to run the transactions for us. We really didn’t want to store credit card numbers on the system as we wanted to avoid all PCI headaches.

What was needed was a service that would take care of all this for us!

Enter two SaaS based billing solutions Zuora and Aria Systems. Both companies generally do the same thing: provide a SaaS based billing solution that can be used by SaaS, subscription based companies.

Aria Systems has been around for a bit longer but been growing more organically and, I think due to their being based out of Philadelphia and not having expanded their sales force until just recently, not as well known. They have a much more mature billing service which can be co-branded or embedded via APIs into an existing SaaS service. The main downside that I see to their current business model is that they are only interested in doing business with companies that have an existing revenue stream. Primarily because of the high cost of configuring a client to use their system. They don’t appear to have embraced the SaaS model internally from the fact of allowing a small early grown company to sign up on a small pay as you go model and then enable that company to learn from self help documentation on implementing the system. Thus, I feel they are likely to miss the rising tide of young companies being successfully and riding that success.

Zuora recently came out of stealth mode to announce their offering. I know a number of talented people who have gone over to Zuora and from what I have learned pre-launch and since from their website, it looks like at the core they offer the same thing as Aria Systems. However, the company was founded by poeple who came from the SaaS space, they claim to understand the new and expanding needs that these companies have and will have. It appears that their system is designed to provide flexibility for the SaaS provider to adapt their service offerings as well as run analytics across it. Something that Aria Systems, doesn’t talk up very much. Since they are still fresh out of the gate, I don’t know if they suffer from the same problem as Aria: not focused on seeding the market with self service, pay as you consume offering that can be used by startups. Their “web 2.0” feel definitely gives them an advantage from initial impression alone.

I’m anxious to learn more about Zuora’s capabilities and hope that it will be the silver bullet for the SaaS project I am working on. As I get more exposure to their offering, I will share my experience.

Virtualization Maybe Key to Apple’s Success with Businesses

May 8, 2008 Leave a Comment

Yesterday I had dinner with a colleague from VMware. During our discussions he made a comment that surprised me and struck a realization for me. He was commenting on how the Macintosh laptops make ideal systems for running virtualization. The reason being that all the hardware on the MacBooks are standardized.

The key to virtualization is the ability to abstract the physical hardware to the operating system. This is the hardest part of any vituralization technology. Not only because of the complexity of that software, but because of the Quality Assurance testing that must be done. Every combination of possible hardware must be tested to ensure reliability. When you think about the combination of hardware possible with PC laptops, the QA test matrix becomes quite large. But, with the Apple laptops, you have a much smaller matrix to test.

We are starting to see serious projects around desktop virtualization (see recent articles How Merrill Lynch Plans To Virtualize Half Its Desktops and Desktop Virtualization Drives Security, Not Just Dollar Savings). When you consider the cost benefits for medium to large enterprises, I think it is clear that we are seeing the start of a wave for desktop virtualization in the IT industry. And that is ontop of just the start of data center virtualization.

Now look at all the variables in PC based business laptops and the complexity of testing all these variations with the virtualization technology, and there is an opening for MacBooks. Of course, this would also require a major change with Apple, they would need to start building an organization that could support enterprises. This means working with them a bit more instead of taking the consumer approach of “here are the options, take it or leave it”.

And then there is Microsoft and their upcoming virtualization technology, don’t expect them to just let such a invasion of MacBooks in the enterprise to happen.

Startup Camp SF Revisited

May 7, 2008 1 Comment

Startup Camp San Francisco was this past Sunday and Monday. In addition to my Live Feed updates, here are my impressions regarding Monday, which was primarily focused on the Best Startup Competition. When working on building something, you can get deep in the details that you forget how to talk about it with someone who doesn’t know anything about it. This is what the Best Startup Competition was there to help the Startup Founders work out, the kinks of their elevator pitch.

21 startups signed up to pitch their company/product to 21 groups of people, 5 minutes per group. This is where the rubber meets the road. If you can’t explain what you are doing and why someone should care within 5 minutes, you’re not going anywhere. I wanted to be kind to each group and give them their time and due, but eventually, some startups were so painful that I had to start just walking away.

Here are a few hints from someone who has given pitches like this for his living for the past 10 years:

Look your audience in the eye, at least once in a while! If you give you pitch looking at the floor or off into space, you can’t connect with the audience. (The one gentleman who I walked away from after 2 minutes, this is the biggest reason why….you know who you are…)
Talk about the Forest, not the Trees. No one cares about the little features your system has. What is the big picture value to me…a potential user? Why should I care, state that first…you have 30 seconds (or less), go…
If your a technology company doing a presentation, use technology to present! While the guy who did his presentation using old fashion flip charts got retro points, he didn’t get my wooden nickel. (nor did he get my full attention)
To really capture your audience, tell a story…don’t do a PowerPoint read along. There was one company who had a presentation that was exactly this, a story about the value his solution provides to his target users, then it went into a brief product demo of the key screens you see to use the system. (I don’t know for sure, but I think he was the winner…see below).

Everyone who competed at the competition gets huge points for doing it. It’s not an easy thing to do especially is such a format. I also think everyone who competed would get value out of the books presentation zen and How to Get Your Point Across in 30 Seconds or Less.

Unfortunately, I had to take off before the winners were announced. But based upon the piles of coins that I saw as I was leaving, Lil’ Grams looks like they either won or placed in the top three. This is the only company that had a presentation that was a story. The startups that I think you should watch out for are (in no specific order):

Lil’ Grams – vertical social network for parents to share their children’s growth with family and friends in a micro-blogging format. And they have a model to make money right away…what a concept!
Velocious – voice ordering platform for restaurants to enable customers to order food en route for pickup. Think no more long lines and waiting in the morning for your coffee…
MarkMail – archiving and discover tool for email. Both public email like lists serves and private email for companies. Their presentation needs a lot of focusing, but I could see thru to the value regardless.
Ultimate Football Network – Another great vertical social/mashup service. All the information you need for making your Fantasy Football picks in a single location…or to just catch up on all the latest details of the football world. Based upon the stickiness factor and size of the market they service, this one is a serious contender.