Investing in Zylo: The Company That Created the SaaS Management Category
As we’ve substantially ramped up our SaaS investing over the last few years, the number, type, buyer, and users of applications have accelerated in an unprecedented way. SaaS is now reinventing the workplace and replacing workflows serving virtually every employee and function in a company. On average, enterprises are spending $10,000 (an ever-growing number) per employee on SaaS, and often they don’t even know it. Nor do they know which applications are being purchased. Many of today’s purchases are made by individual employees (outside of IT) who buy products and services for their discrete business functions or to serve an individual need. This is referred to as a “bottoms up” distribution model and is frequently outside of procurement or historically buyer controls. The result? A “Cambrian-like” explosion in the applications deployed. It creates disorganization, inefficient spend, security issues, and limits visibility around the value and utility of these applications. The problem doesn’t stop there. Even with mainstream applications like Salesforce, ServiceNow, and Workday, companies frequently have unused licenses and multiple subscriptions within an org, and lack context around the right license tiers based on their usage.

That said, the exciting thing for SaaS vendors is the trend of employees seeking out and buying best in breed SaaS products will only continue to grow. Throughout organizations, employees continuously evaluate existing and new vendors that help them get more productive, more collaborative, and do more with their data. This creates a challenge for companies as a whole. It hits CIOs, CFOs, and CISOs particularly hard: without visibility into the specific applications purchased and how those applications are used, it’s hard to optimize software investments and guide employees to tools that maximize productivity while ensuring that all data is secure.
This is where Zylo comes in! By creating transparency around SaaS spend, license utilization, user feedback, and other attributes, Zylo provides a centralized system of record that empowers business leaders to discover, manage, measure, and optimize their SaaS investments. For example, a company using Zylo can see that a third-party app has proliferated their org; they could then assess that applications cost, usage, and engagement to understand its value down to the team and user level. They could then use that information to recommend or consolidate products in the org, negotiate better pricing, and optimize renewals.
The need for SaaS management is growing faster than SaaS itself as the aforementioned issues all compound with scale. That’s why we’re excited to back the company and team that created thecategory. Led by co-founder and CEO Eric Christopher, the Zylo bench is filled with talent from Salesforce and Exact Target. They understand the mindset of the CIO, CFO, procurement, as well as end-users.

Zylo has many of the characteristics we look for and love in a SaaS company: products that provide a system of record (e.g., Benchling, Carta), software that can almost-immediately prove value (e.g., Fleetsmith, Envoy), a category-creator based on unique market perspective (e.g., Harness, Qualia), and a fantastic product and execution team capable of maximizing the opportunity. We found all that and more in Zylo, and we look forward to going “all in” to help them build the next great SaaS company.
