Editorial update – the original press release from BillingPlatform was misleading – the Forrester WAVE report did not say that “BillingPlatform has a better product offering than Aria and Zuora” but that BillingPlatform outperformed Aria and Apttus in 2 out of 35 criteria (and that Aria and Zuora and Apttus outperformed BillingPlatform and other competitors in other categories). BillingPlatform has since removed the Forrester paragraph from the funding press release on their website. The diagram below is a good depiction of relative strengths and weaknesses…

While it might sound worryingly like the liberal use of buzzwords, the fact of the matter is that increasingly organizations are looking to services and subscription models to meet customer needs. It is absolutely a cliché (although an accurate one) to talk about what Netflix has done to movies, iTunes to music and TaskRabbit to personal assistance – all have, in different ways, introduced service models to disrupt an incumbent business model.

So it’s fair to say that organizations are increasingly looking to find ways to innovatively package their products and services in a variety of different ways – no longer does one size fits all,  hyper-personalization is now the name of the game.

But an intention to go subscription, and actually doing it, are two different things. The reality is that traditional enterprise software is big and inflexible and makes it very difficult to innovate around the monetization models. many years ago I spent time consulting at a large telco about its plans for a marketplace of cloud-based applications. the main thing that stymied their initiative? Their core billing system simply wouldn’t allow them the flexibility they needed.

Which is why we have seen a huge movement in recent years around this topic – both from ERP vendors wanting to provide more flexible subscription functionality and standalone subscription and billing vendors. For the former, we have cloud vendors such as NetSuite, FinancialForce, and Intacct that are strongly telling a subscription story, while in the pure play world, companies like Zuora and Aria suggest that subscriptions are so complex that only a specialist vendor can compete.

There has been a degree of consolidation in the space – MetraTech was acquired by Ericcson, Monexa by NetSuite and Vindicia by Amdocs. That consolidation was caused partly by having too many vendors when a market was at a nascent stage and partly by these more traditional vendors needing a good cloud-based billing story.

So it is interesting to see news from BillingPlatform, a company in the same space (although they call themselves an “agile monetization” vendor.) Despite being relatively new to the market, the company has done well, landing clients like JetBlue, Siemens and Energy Australia. They also, for what it’s worth, just got a nice placement in a Forrester Wave report, which said BillingPlatform has a better product offering than Aria and Zuora.

New funding, New CEO

BillingPlatform has secured $18 million in funding from Columbia Capital. Well, kind of. Columbia has committed to an $18 million investment over the next 18 months, but the company has only drawn down an initial $4 million of that.

The optics of that are a little strange. Is it a case of BillingPlatform wanting to only take money as it needs it, in an effort to reduce the dilutive impacts of an investment (a smart move, potentially), or is it an anxious Columbia Capital, not being sufficiently convinced to put all the cash in now. People will have different opinions on that one, I guess.

No matter what the optics of the investment, BillingPlatform’s new CEO is an interesting hire. Dennis Wall was the co-founder of Cloud Sherpas, the global cloud advisory and technology services firm acquired by Accenture in 2015. He obviously understands the requirements of modern businesses (Cloud Sherpas was a Google Apps and Salesforce service company) as well as how to manage an impressively growing firm.

Elvis has not left the building

New CEO appointments are always interesting and can raise some eyebrows in terms of what it means for the incumbents being replaced. In this case, however, it seems an amicable move – BillingPlatform co-founders Nathan Shinn and Leonid Solomonik have been named Chief Strategy Officer and CTO, respectively.

Filling the continuum of needs

BillingPlatform launches back in 2012 and hence has had a few years to build out its product vision of supporting the entire billing lifecycle. It offers a native metering and rating engine that enables complex business models and integrates with leading CRM, ERP and other core systems.Newly minted CEO wall opines on the company’s vision, and why it has a good chance of success:

Our mission is to give companies flexibility in how they monetize their products and services, and agility in how they innovate and evolve their processes. Legacy billing solutions simply can’t do this. As one of our largest customers said, ‘We felt like we had to mold our monetization strategy and processes around [the legacy provider’s] solution, whereas BillingPlatform was able mold its solution around our business.’ That statement says everything you need to know about the direction of our market and our place in it.

I asked Wall about whether the space is already well-served and how much of a window of opportunity BillingPlatform has. – won’t the ERP vendors simply build the functionality to serve this need? His response:

Respectfully, I disagree with the notion that the agile monetization market is ‘all sewn up.’ In our view, cloud ERP vendors are still trying to figure out how to provide true finance/accounting functions. Do these vendors have the time, bandwidth and acumen to also tackle monetization? We don’t see it right now. Likewise, we believe best-in-class solutions (v. suites) are going to increase in popularity as the enterprise becomes more comfortable with cloud, and particularly as the integration of systems becomes easier with everything being in the cloud.

And Wall doesn’t mince his words when critiquing his pure-play competitors. While he doesn’t mention it, this is obviously a reflection on the Forrester report and BillingPlatform’s high praise, especially in comparison to its competitors:

Meanwhile, ‘pure-play’ agile monetization vendors have been amazing evangelists for our category, and were on point with the disruption we are seeing in how enterprises monetize customer relationships and how customers want to consume goods/services. On the other hand, these vendors have not been as effective in anticipating how flexible and agile these monetization solutions need to be. The most well-known pure-play solutions are still fairly basic, rigid and require significant customization

Wall’s bottom line? We’re not at the end of the road here, it’s early days and there’s still a heap of opportunity:

I believe the agile monetization market is just starting to take off and the enterprise is experiencing disruption in nearly every market. Uber, AirBnB, Dollar Shave Club, etc. are all great examples of traditional monetization models breaking down.

MyPOV

When it comes to standalone billing vendors, industry darling Zuora has sucked up most of the oxygen. I spent time with the four players around a few years ago (Zuora, Vindicia, Aria, and Monexa) and the other three were continually commenting on how hard it was to compete in a sector where one player has so much voice. This is a battle that they never really one, and BillingPlatform will have its work cut out in order to have its message heard.

That said, it has seen some early success and seems to be heading in the right direction. A case of having to watch this space.

Ben Kepes

Ben Kepes is a technology evangelist, an investor, a commentator and a business adviser. Ben covers the convergence of technology, mobile, ubiquity and agility, all enabled by the Cloud. His areas of interest extend to enterprise software, software integration, financial/accounting software, platforms and infrastructure as well as articulating technology simply for everyday users.

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