SaaS Provider Workday Picks Up an $85 Million Round
October 25, 2011
There’s been a small cluster of hysterically big funding rounds lately exemplified by Dropbox’ $250 million B round last week.
On Monday six-year-old Workday, which logically enough does a SaaS version of PeopleSoft’s HR, payroll and financial management widgetry since it was started by PeopleSoft founder Dave Duffield and his trusty lieutenant Aneel Bhusri, said it got a handsome $85 million in Series F financing led by cloud-struck new investors including T. Rowe Price, Morgan Stanley Investment Management, Janus Capital Group and Bezos Expeditions, the personal investment arm of Amazon CEO Jeff Bezos…
All Things Digital, the blog that broke the news just ahead of the press release, said the company got a $2 billion valuation.
The boys evidently wrote checks because Workday wants to IPO late next year. Bhusri described the round to All Things D as an "early debut of an IPO," expecting that his new institutional investors will buy when he goes public and if the market stinks he’s got enough money to wait.
The money, which makes $250 million so far, will be used to expand Workday’s core technology, products, go-to-market capability and administrative infrastructure.
Workday claims two million users across 230 mid-size companies to Fortune 500s – mostly coming off Oracle or SAP – and will probably be close to breakeven this year with revenues of around $320 million.
Meanwhile, Workday is integrating with Zuora, the cloud-ified subscription billing and commerce start-up, reportedly because of customer demand.
Workday says, "The traditional ERP model was product-centric with a focus on procurement. Today business is about service and the focus is on bookings, revenue – current, recurring and deferred – and renewals, which can make it tough to run a modern business on traditional ERP. Connecting Zuora with our revenue management solution will provide a very strong solution, especially to our customers with businesses in service industries, high-tech, communications and media."
Zuora was a tad more abrupt. "Traditional ERP," it said, "is irrelevant in a world of services where the focus is on precise pricing, metering and rating, not counting widgets and attempting to optimize shipments. Zuora’s partnership with Workday is a critical step to helping enterprises make the shift to a customer-centric model, and succeed in this new world."