Zuora Taps PayPal For Cloud Payments

After getting its start as a billing platform for software as a service, Zuora is coming full circle with a service for collecting on the tab. The startup's new Z-Payments service ties into PayPal's e-payments system.InformationWeek profiled Zuora in September. The company's Z-Billing service was launched in May as a hosted billing service for SaaS providers. Salesforce.com CEO Marc Benioff is an investor in the company.

Z-Payments is the complement to Z-Billing. Zuora used PayPal's SDK and APIs to tie into the PayPal billing engine, and PayPal processes the credit card transactions. Z-Payments is included at no extra cost with Z-Billing. Alternatively, Z-Payments will become available later this quarter as a standalone service, beginning at $500 a month.

Who needs it? Zuora CEO Tien Tzuo says potential customers include SaaS vendors and conventional businesses that are introducing products -- everything from cars to organic vegetables -- as subscription-based services, but which don't want to develop their own billing and payments platform. "It's scalable, automated, and PCI-compliant," says Tzuo.

The company has 40 customers, twice as many as it had three months ago. Z-Payments users include storage-as-a-service vendor Box.net and Teach the People, developer of a soon-to-launch Facebook application.