What can be done to address this? How are subscription businesses to grow if the systems they're using are not designed for how they work? At salesforce.com, we had to spend millions to build the internal systems that are needed to scale a $1 Billion company. The particular pain we felt was what prompted me to leave salesforce.com, after nine years, to start my new company, Zuora, Inc. Why should all subscription businesses have to feel the pain we felt at salesforce.com, spend that kind of budget, or devote that kind of resources, just to offer their products and collect on the bills? For subscription businesses to thrive, they need new technologies that are developed just for this unique model.

In many ways, subscriptions are simply the next great monetization model of the Internet. Online commerce started over 10 years ago with Amazon and eBay, when we saw e-tailing become the new, novel and extremely convenient way to shop. PayPal, the first truly scalable online payment system, next made secure transactions online a reality, allowing another economy to grow and flourish. Finally, Google allowed thousands of businesses large and small to monetize their Web sites through ads, using Google's online advertising platform. Where will online commerce go next? I wholeheartedly believe subscriptions are the answer, and the only way to drive this next engine is to develop the technologies to support it. In the next 10 years, consumers and businesses alike will find themselves buying less, and subscribing more. At that point, the transformation of our society from a manufacturing era to a services era will finally be complete.


Tien Tzuo is founder and CEO of Zuora. Prior to Zuora, Tzuo spent 9 years at salesforce.com where he was the 11th employee and oversaw the launch of both salesforce.com and AppExchange.

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