March 22, 2012
When in Austin recently I took the opportunity to meet with Transverse, another player in a space I call Revenue Lifecycle Management of RLM. Revenue Lifecycle Management includes the obvious functional area such as subscription and billing services, but extends these into a realm that deals with the entire lifecycle of a customers relationship with the business. If CRM extended the relationship between sales prospects and the vendor, then RLM is the equivalent service once customers are on-board and paying for a product or service. Founded in 2008, Transverse is self-funded with around 30 customers across a wide variety of industries.
Anyway – Transverse contacted me with some fairly lofty claims, in particular that they are one of the only cloud players truly meeting the needs of sophisticated subscription users. Implicit in this claim (and indeed explicit in the conversations we had) was the contention that other cloud-based RLM vendors (for example Zuora, Vindicia and Aria (see disclosures)) only meet some of the needs of these mature subscription users. In particular they claim that real-time rating and charging, entitlements and usage aware analytics are lacking with some vendors. As they said;
…in terms of true carrier-grade rating, charging and billing that scales up and is flexible enough to accommodate any variable marketing folks dream up for monetization, we are the only ones doing this in a SaaS, pay-as-you-go model…[others do not] have real time rating and charging engines, so they can’t possibly do this (they’re simple payments and nothing beyond)
The thrust of Transverse’s claims lie in what they’re seeing as the move from plain subscription services to activity based billing. They’re seeing a growing need from companies to deliver the sort of flexibility that the legacy RLM tools (AmDocs for example) can offer – the ability to measure anything that can be billed for. They also note that these large systems simply cannot scale downwards to the needs of mid sized businesses.
The heart of the Transverse proposition lies in the provision of configurable, but standardized workflows. Talking with Ben Bradly and Chris Couch from Transverse they believe that this approach brings the ease of use of a SMB application, but with sufficient breadth to meet the needs of this activity based RLM. As organizations see pressure to reduce prices downwards, it is through the provision of additional “activity types” that sees them gain additional revenue. A good example of this would be a telco customer who can buy a mobile data add-on, or a “bucket” of SMS messages. While this has long been the norm in Telecom businesses, many other verticals are seeing a demand for these sophisticated subscription models. As an aside it’s a trend we’re seeing with cloud computing vendors who may be wanting to offer billing based on time, data transfer, storage, users or a mixture of all of those.
One example that Transverse gave of a customer use case that would not be met by other vendors is a stock tips service they have as a customer. This service offers customers pricing for a package of stock tips with revenue based on the gain users make should any of those tips be successful. It’s a complex model and one that needs to balance customer ease of use with flexibility around revenue models.
In terms of the product offering, Transverse in a Java-based application that is PCCI and SAS70 compliant. They also allow embedded charging with a secure frame within an organization’s website and tokenization for credit card details – thus removing any PCI compliance burden from customers. While Transverse started out with small sized customers, they believe their solution scales up to organizations with a circa $1B revenue level. In accordance with their own vies about the subscription economy, pricing varies including the ability for users to purchase gross billing “buckets” of service that don’t expire.
It was interesting to spend time getting Transverse’s view of the RLM world. While I’m not convinced by their claims to be the only provider meeting the needs of RLM users in the cloud, it’s always good to see a feisty competitor come on the scene. It will be interesting to see how they compete with their much larger, better funded and well known competitors in the space.