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Zuora snaps up Leeyo for added next-gen cloud accounting support
Subscription commerce and billing startup Zuora Inc. has acquired Leeyo Software Inc., a Santa Clara, California-based enterprise revenue recognition automation and management startup, for an undisclosed sum.
Founded in 2009, Leeyo offers next-generation revenue recognition software, a type of software that tracks company accounts to comply with generally accepted accounting principles in that it determines the specific conditions under which revenue is recognized or accounted for. Under the principle, revenue is recognized only when a specific critical event has occurred and the amount of revenue is measurable.
The company’s cloud-based RevPro platform is claimed to rescue companies and revenue teams of all sizes from the chaos of manual data entry or customized processes by automating and managing every process facing a revenue team. Leeyo customers include EA, Symantec, Dunn & Bradstreet, GE, NetApp, Concur and PopSugar.
Under the deal, Zuora intends to add RevPro to its existing order-to-cash product portfolio, creating a one-stop shop for automating financial operations. Zuora currently provides service for companies that work with subscription models with over 800 customers, including Box, Komatsu, Rogers, Schneider Electric, Toshiba, Xplornet and Zendesk.
Zuora noted that the acquisition allows it to provide support for a forthcoming change in global accounting standards due to be implemented in 2018-2019: ASC 606 and IFRS 15. Those standards are said to significantly increase the compliance burden for reporting companies.
“We’ve been saying that accounting standards have to change to accommodate the subscription economy and now they have,” Zuora Chief Executive Officer and founder Tien Tzuo said in a statement. “Every company, regardless of revenue mix, product or service offerings, will be impacted by these new accounting standards. We’ve partnered with Leeyo for over three years and today we join forces to help our customers alleviate the burden of dealing with these new standards.”
Coming into the acquisition, Leeyo had never raised a cent of venture capital. Founder Jagan Reddy said in an interview last year that he had bootstrapped the company from day one and then sustained the business with cash flow.
Image: Leeyo
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