Private-equity firm Silver Lake is making a roughly $400 million investment in Zuora Inc.
Silver Lake managing partner Joe Osnoss will also join Zuora’s board.
“This investment is a validation of the undeniable momentum in the subscription economy,” Zuora Chief Executive Tien Tzuo said in a statement.
Zuora said some of the money could be directed to acquisitions.
Shares rose 4.6% to $16.10 in after-hours trading.
With Mr. Osnoss’s addition, Zuora will expand its board to 10 members. His term would expire in 2024, Zuora said.
Silver Lake is also entitled to designate one non-voting board observer, the company said
Zuora disclosed the investment as it reported results for the quarter and year ended Jan. 31, including a 14% revenue increase for the year to $346.7 million.
This year, Zuora expects $402 million to $406 million in revenue. Analysts surveyed by FactSet forecast $402.2 million.
The company expects annual recurring revenue growth, a key performance metric for companies with subscription revenue, to increase by at least 21%.