Merger and Acquisition

Zuora Acquires Chennai-Based SaaS Startup Togai to Enhance Monetization Offerings

• ByStartupStory     |    May 3, 2024

California-based Zuora has announced the acquisition of Togai, a Chennai-based startup specializing in metering and pricing platforms for SaaS applications. This acquisition is set to finalize this month, pending customary approvals and closing conditions.

Founded in 2022 by Abhishek Rajagopal, Aravind Sriraman, and Tholkappiyam Velavan, Togai has developed a notable presence in the SaaS industry by providing a usage-based billing engine tailored for large language models (LLMs) and other artificial intelligence (AI) systems. Togai’s innovative approach includes a low-code builder and a developer-friendly interface, allowing seamless collaboration between developers and finance teams.

“Today marks the dawn of a new era in monetisation where our two worlds come together to form something greater than the sum of its parts,” stated Togai cofounder and CEO Abhishek Rajagopal in a recent blog post. He emphasized that the acquisition would make Zuora indispensable to CFOs and also a favorite tool among developers.

Zuora’s acquisition of Togai is particularly strategic as it expands Zuora’s existing suite of products with Togai’s advanced metering and rating systems. Togai’s technology facilitates the direct ingestion of events from LLM query APIs and supports complex tiered pricing models. The platform is boasted to enable developers to rapidly deploy a usage-based billing system capable of handling up to a billion AI transactions in a single day.

Tien Tzuo, founder and CEO of Zuora, highlighted the synergy brought by Togai’s offerings: “Togai’s sophisticated metering and rating extends Zuora’s market-leading monetization suite to accelerate usage-based models.”

Once integrated, Togai’s solutions will complement Zuora’s array of products, including Zuora Billing, Zuora Revenue, Zuora Payments, Zephr, and the Zuora Platform.

Abhishek Rajagopal further noted the efficiency and scalability of Togai’s solutions, saying, “Developers spend months building internal metering and rating systems, which can quickly evolve into a dedicated team of engineers as companies realize that building a usage-based billing system is not a one-time effort. Togai makes it possible to go live in hours with an out-of-the-box, flexible solution to model any type of pricing and reliably scale.”

This acquisition occurs amidst a burgeoning phase for the Indian SaaS industry, which, according to a Mckinsey report, is projected to grow to $50-70 billion by 2030 from $7 billion in 2020. However, it’s noteworthy that the pace of mergers and acquisitions in the Indian startup ecosystem has seen a decline, with 123 transactions in 2023 down from 240 in 2022, signaling a more cautious approach in the market.

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